At their 16th bilateral summit on Sunday 30 October, the European Union and Canada signed the EU-Canada free-trade agreement (CETA), seeking to convince the opponents of the deal, some of whom protested outside the buildings of the Council of the EU the same day, of the benefits that 543 million European and Canadian citizens will obtain.
Despite the "technical obstacles", such as mechanical problems with the government aircraft that delayed the touchdown of the Canadian delegation in Brussels, we have signed two "landmark agreements" with Canada, the "most European country outside Europe", said the President of the European Council Donald Tusk who borrowed a Canadian proverb: "Patience is a tree whose roots are very bitter, but its fruit is very sweet". On the European side, the EU very much needed to show its capacity to approve international trade agreements, despite the pitfalls inherent in its institutional structure.
The signature of the CETA came after two weeks of marathon talks with several administrative levels of Belgium, the last country to approve the signature of the trade agreement (see EUROPE 11656, 11657). In particular, Wallonia sought guarantees for the protection of its agriculture, public services and the jurisdiction to be used to settle disputes between investors and states. This episode obliged the Europeans and Canadians to postpone the bilateral summit which was initially scheduled for Thursday 27 October.
By signing, Canada and the 28 states of the EU have enshrined their commitment to a trade agreement that aims to vouchsafe a better future for all citizens, said Canada's Prime Minister Justin Trudeau. He went on to predict that the CETA would increase trade between the partner countries by 20%, contribute to economic growth that will benefit many, and keep joint standards high.
Tusk admitted that the "facts and figures won't stand up for themselves alone" to convince the citizens of the justification for free trade which, he stressed, will by its nature reduce poverty and ease conflict. The "controversy around the CETA demonstrated that our first priority is to produce convincing information about free trade", he added.
Speaking along similar lines, President of the European Commission Jean-Claude Juncker stressed the respect for values and principles such as decent work, health and security, cultural diversity, air quality and the defence of public services to justify the signature of the trade deal with Canada, which he described as the best and most progressive ever negotiated by the EU. He said that he was perturbed that they had been accused of sacrificing workers' rights on the altar of this agreement. He stressed that this was not the case and that he had not come to Brussels to kill off the vital standards that govern our employment markets, in response to criticism from European and Canadian unions.
Juncker said that the CETA would in fact lay down the level of ambition called for by the Europeans for bilateral trade agreements currently being negotiated, such as the TTIP agreement being negotiated with the US. He stressed that it is by opening ourselves up to others using trade agreements that we will succeed in shaping globalisation. He asked all those who had taken to the streets and were asking justified questions to listen and to hear the fact that the EU has not given way over anything.
One of the most controversial elements of the CETA concerns the creation of the ICS mechanism for the arbitration of disputes between investors and states (see EUROPE 11501), regarding which Belgium will seek the opinion of the Court of Justice of the EU as to whether it is compatible with European law. Trudeau stressed that the two sides had worked to develop a new, improved and more progressive model to ensure that governments always have the right to defend the consent of their citizens.
To respond to the concerns raised, the EU and Canada have adopted a joint interpretative declaration, which has been reinforced to help along Belgium's green light to the signature of the deal. As well as reaffirming the fact that the states will have the capacity to rule and to provide public services, the statement notes that the ICS mechanism constitutes a radical change in the way international investment -related disputes are settled (creation of a Court of Appeal, independence of the 15 judges, public hearings, and so on) and is ultimately expected to pave the way for the creation of an ad hoc multilateral jurisdiction. By the time the trade agreement enters into force, the EU and Canada will also have drawn up a code of conduct further to guarantee the impartiality of the members of the courts, their working methods, level of pay and selection process, the statement stresses.
Towards a provisional application of the CETA by early 2017.
Now that it has been signed, the CETA will enter into force provisionally for the areas of exclusive European competence once the European Parliament has given its consent, as it may do at the December plenary. There is no doubt as to this stage, given the political majorities in place.
Trudeau said that the provisional application will represent 98% of what is laid down in the CETA. In particular, almost all tariff barriers will disappear, saving European businesses €500 million a day, Juncker said. Tusk stressed that the provisional application of the trade deal with Canada would be the best teaching tool to win over its detractors.
In total, on the European side, no fewer than 38 national and regional parliaments will be required to ratify the EU-Canada trade agreement before it, and the ICS mechanism in particular, can be fully applied.
Visas lifted for Bulgarians and Romanians at end of 2017.
In addition to the CETA, the Europeans and Canadians signed a partnership agreement which will steer their bilateral cooperation in a number of areas. This partnership lays down a robust framework to act together in international relations, crisis management, security, energy, climate protection and mobility, Tusk said. He also hailed Canada's decision to remove visa requirements for all Bulgarian and Romanian citizens by the end of 2017. He referred by way of example to Canada's commitment over the migration issue, with the resettlement of 73,000 Syrian refugees since the Trudeau government came to power one year ago. (Original version in French by Mathieu Bion with EL)