The EU’s trade agreement with Canada cleared a crucial hurdle today (24 January) when it was approved by the European Parliament’s International Trade Committee, making way for the deal to be sent to a vote in the entire 751-seat chamber next month.
Twenty-five MEPs in the committee voted in favour of approving CETA, the EU-Canada Comprehensive Economic and Trade Agreement, while 15 rejected it and 1 abstained.
Tensions over CETA have been fraught since last autumn when the regional parliament of Belgium’s Wallonia delayed approving the deal, raising concerns that it might be scrapped entirely.
European Commission President Jean-Claude Juncker and Canadian Prime Minister Justin Trudeau signed the agreement in October. But CETA must be approved by the European Parliament and national parliaments in EU member countries before it can go into effect.
Last month, the European Parliament’s Social Affairs Committee voted to reject the deal on grounds that it does not do enough to boost job growth and improve working conditions. The Parliament axed a resolution last autumn to send the deal for approval to the European Court of Justice.
Supporters of CETA argue that it will add €12 billion each year to the EU’s economy and €8.5 billion to Canada’s, while increasing trade between by 20% between the 28-nation bloc and the North American country and getting rid of 99% of tariffs.
But critics warned that CETA lower environmental standards and pave the way for TTIP, the free EU-US trade agreement that has stalled amid broad outrage in European countries over the deal.
EU Trade Commissioner Cecilia Malmström warned MEPs yesterday that Europe needs to hold onto its “like-minded partners” like Canada, especially in light of newly inaugurated US President Donald Trump’s protectionist platform.
Just after Malmström finished speaking in the Parliament committee, Trump announced he would pull the US out of the Trans-Pacific Partnership (TPP), a free-trade agreement between 12 countries that was awaiting ratification.
“We have an important friend and ally who seems to be at least partly disengaging from the international scene promoting less trade, more protectionism,” Malmström told the committee.
Latvian Partija Vienotiba MEP Artis Pabriks (EPP) said after today’s vote that the Parliament had addressed “all the concerns of our citizens” about CETA.
“This was possible because Europeans and Canadians share the same values and mutual trust,” Pabriks said.
“They label any criticism as a capitulation to populism, but an honest look at the evidence would force them to recognise that multinationals are gearing up for an assault on nature, on our health and on social rights,” said Greenpeace EU trade policy adviser Shira Stanton.
Greens/EFA MEP and outspoken CETA critic Ska Keller (The Greens) held her position that the EPP and parts of the S&D group have ushered in “a free trade deal that will be to the detriment of citizens”.
She added that “CETA undermines the precautionary principle in Europe and its use of private arbitration courts restricts democracy. The majority of MEPs voted in favour but it is still not clear how they are going to control CETA.”
The committee vote was the last big hope of CETA’s legions of detractors that the deal would be torpedoed. According to its critics, the agreement will water down Europe’s high standards in environmental and consumer protection, municipal heritage and cultural entities.
German CDU MEP Daniel Caspary (EPP) welcomed the decision, insisting that CETA is an opportunity: “CETA brings more trade, more growth, new jobs and higher wages”. Anti-trade activists had “taken it hostage and sought pretext after pretext to delay it”, he added.
Chairman of the International Trade Committee, German SPD MEP Bernd Lange (Socialists & Democrats) disagreed with this view and praised CETA for being “a progression expression of European trade policy”, which was negotiated thanks to “social-democratic pressure”.
Lange claimed that unlike other groups that had voted yes or no based purely on ideological grounds and that his group had debated extensively about the details of the deal and enforced reforms.
CETA will face a final vote in the Parliament’s plenary session on 15 February.
Anne-Marie Mineur, GUE/NGL Shadow Rapporteur for CETA: “I am disappointed and worried that the International Trade Committee has voted in favour of the CETA agreement.
It is a terrible agreement for many reasons. Not only is there very little basis for all the big promises of jobs and economic growth, yet huge risks for our labour rights, environmental protection and consumer rights, but there are also still a lot of loose ends in the dossier. For example, serious doubts remain over the ICS arbitration system and the Joint Committee. The lack of democratic involvement and minimal transparency also set an alarming precedent for trade agreements to come. It is very worrying that only a manipulative populist like Donald Trump, who bases his economic views on chauvinism rather than a rational approach to sustainability and fairness, has taken up the demands from the real popular resistance to this type of trade agreement, while our own elites have so far ignored the will of the people."
Helmut Scholz, GUE/NGL Coordinator for the International Trade Committee: “The majority of MEPs that voted in the Committee today have ignored the thousands of cities and regions across Europe and the hundreds of thousands of citizens who have clearly said that they do not want this agreement. They have also ignored the analysis of experts who predict negative consequences from CETA.
“Serious estimates indicate that more than 200,000 jobs could be lost in the EU as a result of further market liberalisation generated by this agreement. CETA would not bring the big economic growth that has been promised. After seven years, it would only increase the gross domestic product of the EU by 0.03 per cent. The income gap between skilled workers and unskilled labour will increase. For these reasons, the European Parliament's Employment Committee has also expressed its opinion against CETA.
“Regulatory cooperation, with which the company's interests are incorporated into legislative processes, is also present in CETA, not only in TTIP, but also in a modified form. The controversial 'Investment Court System' (formerly known as the investor-state dispute resolution mechanism or ISDS), introduces special rights for corporations to sue governments under conditions favourable to them. This has led the Parliament's Environment Committee to also oppose CETA. Those who have properly examined this agreement have opposed it. Sadly, the majority of the International Trade Committee have instead chosen to ignore the evidence and the agreement is being rushed through the Parliament without proper analysis or debate.
"The hope of our population is now in the hands of the 751 MEPs who will vote on this agreement in the plenary session of the Parliament and the member states who must vote on whether to accept the agreement in their national parliaments. The resistance to this agreement will not stop here. More than 2,000 cities, municipalities and regions in the member states of the European Union have already declared themselves to be TTIP- and CETA-free zones.”
David Martin MEP, the S&D spokesperson on trade: “Together the EU and Canada have negotiated the most progressive trade deal ever. An agreement which cements our bilateral relationship while providing important opportunities for our economies. With CETA, we are rejecting unfettered globalisation and laying the foundations for a new era of rules-based trade, where the benefits are spread more widely and our labour and environmental standards are preserved.
“While globally the tendency is to turn in on oneself, the EU and Canada are leading the way towards a world trading system that is open for business without compromising our values or way of life.”
S&D MEP Sorin Moisa, who is responsible for the CETA agreement in the S&D Group: “Today's vote on CETA is a major step towards consolidating the role of the S&Ds as the key political group in the European Parliament on reforming Europe's trade policy.
“Our progressive agenda has shaped the CETA package, including by introducing a public system of investment dispute settlement with a role for the European Parliament in the selection of independent judges; ensuring exclusive sovereign control of our own standards and public services; and promoting trade and sustainable development, including by moving towards a sanctions-based system.
“CETA helps to recapture some of the ground lost to multinationals in the early stages of rampant globalisation, protecting the right to regulate and creating a level playing field for SMEs.”
MEP David Campbell Bannerman, ECR shadow rapporteur: “Of particular importance is that CETA will eliminate 99% of tariffs saving EU exporters almost €500m a year across all sectors, including services, and will also give EU companies access to Canadian procurement markets, something that Canada has never allowed before. In addition, it contains welcome new elements, such as a mechanism to allow for mutual recognition of professional qualifications.”
“However, it has taken too long to get to this point, and the EU must reflect on the time that it takes to get agreements negotiated and signed if they are to be taken seriously in future with major trading partners.”
Guy Verhofstadt, ALDE leader: "In the light of President Trump’s many comments on trade policy and his cancellation of the Trans-Pacific-Partnership (TPP) yesterday, it is now more important than ever that there is no further delay in the approval of CETA. We have to forge alliances with Canada and other partners in the world. The EU and Canada must work together to strengthen the multilateral system.”
MEP Marietje Schaake, ALDE trade spokesperson: “CETA is the most modern and progressive agreement that the EU has ever negotiated. We need to make sure that this agreement with the liberal Trudeau government comes into effect as soon as possible.”
“Tariffs will be removed and procedures will be simplified, less bureaucratic and more predictable. Europeans will be able to bid for more Canadian public contracts, which is a crucial benefit. The Canadian economy is bigger than the Russian economy and of great importance for Europe. Together with the Canadians, we can work to strengthen the global rules-based trade system and promote high standards worldwide.”
Maryant Fernández Pérez, Advocacy Manager of European Digital Rights (EDRi): "We regret that the international trade committee appears to be motivated by short-term political objectives, rather than what is actually written in the text of CETA. CETA does not contain adequate protection for online fundamental rights nor for Europe's right to regulate.”
MEP Emma McClarkin, Conservative International Trade spokesman: This is one of the highest quality agreements ever negotiated and clearly highlights the benefits of free trade. "CETA will eliminate 99 per cent of tariffs between the EU and Canada, save EU exporters €500 million a year and increase trade by 20 per cent. Britain alone will benefit by £1.3 billion a year.
"It took the EU far too long to reach this stage and hopefully lessons have been learned about how future trade deals should be conceived, negotiated and ratified."
MEP Marietje Schaake (ALDE/D66): "CETA is the most modern and progressive agreement that the EU has ever negotiated. We need to make sure that this agreement with the liberal Trudeau government comes into effect as soon as possible. President Trump has announced measures that will have large effects for Canada. The EU and Canada must work together to strengthen the multilateral system."
"Tariffs will be removed and procedures will be simplified and more predictable. Europeans will be able to bid for more Canadian public contracts, which is a crucial benefit. The Canadian economy is bigger than the Russian economy and of great importance for Europe. Together with the Canadians, we can work to strengthen the global rules-based trade system and promote high standards worldwide.”
"Canada and the EU have made major improvements to investment protection within CETA to make it fairer and more transparent. We do not want secret courts. The biggest problem is that EU member states still have 1,300 treaties with the old-style ISDS in them. These need to be reformed. Together with the Canadians and other international partners, we must work on a multilateral investment court, using the model of the World Trade Organisation as a basis. CETA is a step in that direction.”
Artis Pabriks (EPP, LV), rapporteur for the CETA agreement: "By approving CETA today we take a significant step forward. In the face of rising protectionism and populism, Parliament is able and willing to act on behalf of European citizens. I stand for a strong and global Europe and for open markets. Ratifying this agreement with Canada will enable trade to continue to bring wealth to both shores of our transatlantic friendship. The duty of our governments is to ensure that each and every one of us benefits from this wealth.”