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11/12/2016

Belgians keep EU, Canada in suspense on CETA trade deal

Trade & Society

Belgians keep EU, Canada in suspense on CETA trade deal

Feuding Belgian politicians, keeping Canada and the European Union waiting, resume talks on Wednesday (26 October) with hopes fading that they will unblock the CETA free trade deal in time for a planned signing summit.

Belgian and European Union officials held a string of meetings aimed at winning over the Wallonia region, which has prevented Belgium from supporting the agreement and effectively blocked a deal that must be endorsed by all 28 EU nations.

“I want to be clear on the fact that we have already received three ultimatums and that we will not tolerate a fourth ultimatum, wherever it comes from,” Wallonia leader Paul Magnette told reporters.

“If there is a fourth ultimatum, we will stop the negotiations.”

Wallonia rejects EU 'ultimatum' over CETA

Belgium’s Wallonia region yesterday (23 October) dealt a fresh blow to a proposed EU-Canada trade deal, rejecting a 24-hour ultimatum from the bloc to end its objection to the agreement.

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Canadian Prime Minister Justin Trudeau was due to fly to Brussels to ink the CETA trade pact with EU leaders on Thursday. But Belgium’s federal government failed, in six hours of negotiations on Tuesday, to overcome a veto from the region of Wallonia that is stopping the European bloc from signing up.

Didier Reynders, the Belgian foreign minister who chaired the talks, said he hoped that his Liberal-led federal government could forge a common position with Socialist-led Wallonia, one of five devolved authorities whose agreement it needs. It would then go back to EU negotiators trying to conclude the accord.

“I hope we can give a signal to our European colleagues that we are ready to respond to the European discussion on the basis of Belgian proposals,” he told reporters late on Tuesday, while stressing that he could not yet say if Belgium would sign up.

Tusk and Trudeau still hope to sign CETA trade deal after Belgian 'Non'

Belgium declared yesterday (24 October) that it could not formally back a free trade deal between the European Union and Canada because of an internal dispute, but the two sides still appeared to be holding out hopes of a summit to sign off on the deal.

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Deal could take weeks

Paul Magnette, the Wallonia premier, has said it could take some weeks to agree a deal that has been seven years in the making. He repeated on Tuesday that his French-speaking region, less than 1% of the EU’s 507-million population, could not agree to an arbitration system in CETA that he said favoured multinational corporations over existing national courts.

EU and Canadian officials have said that even if Trudeau does not come to sign the accord, they will keep talking. Canada, with much to lose from failing to gain easier access to such a big market, says the ball is in Europe’s court.

All 27 other EU states are ready to sign up, as is Belgium’s federal government and its biggest region, Dutch-speaking Flanders. Critics accuse the French-speaking Socialists, pushed out of federal power for the first time in over 20 years by the current coalition, of exploiting its veto for domestic ends.

Magnette, who has reacted angrily to pressure to reach a deal in time for Trudeau’s visit, told reporters after the talks that he wanted an accord with Ottawa. “We’ve always negotiated in good faith,” he said. “Our demands are very clear,” he said.

“We want to start to be understood.”

Belgian professor: What’s wrong if CETA is signed in December?

Belgian Professor Jean-Michel de Waele slammed the European Commission for twisting the arm of Wallonia over CETA, the  Comprehensive Economic and Trade Agreement between the EU and Canada.

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‘CETA is not dead’

Meanwhile, the European Commission renewed calls for patience while a majority of the European Parliament called for the most ambitious trade deal in EU history to be saved.

“CETA is not dead,” said both the head of the Conservative European People’s Party bloc, Manfred Weber, and his liberal counterpart, Guy Verhofstadt, during a session in Strasbourg, France.

Verhofstadt, a former Belgian prime minister, said it was important to lay the groundwork for approving the deal by November and signing it in December.

European Parliament President Martin Schulz told German radio that he did not think a solution will be reached this week but that delaying the summit would not mean failure.

“If you need 14 more days then you just push back the summit,” he said.

CETA deadlock complicates EU efforts to relaunch trade policy

A Canadian minister left Brussels in tears on Friday (21 October) as Wallonia’s staunch opposition to the EU-Canada agreement puts the future of new trade deals at risk.

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Background

The EU's current trade relations with Canada are guided by a Framework Agreement for Commercial and Economic Cooperation, in force since 1976.

The EU and Canada launched CETA negotiations in May 2009 and agreed on the content and its general strategy in June 2009.

The European Commission proposed the signature of the EU-Canada Comprehensive Economic and Trade Agreement (CETA) to the Council of the EU in July 2016. If the Council approves the agreement, it will need the European Parliament consent for it to be finalised.

The national parliaments of the EU member states would then also need to ratify CETA for the areas which fall under their responsibility to take effect.

This ratification procedure follows the release of the legally reviewed CETA text in February 2016.

In 2015, Canada was the EU's 12th most important trading partner, accounting for 1.8% of the EU's total external trade. The EU was Canada's second most important trading partner, after the US, with around 9.5% of Canada's total external trade in goods in 2015.