Tue | Sep 26, 2017

EU parliament clears CETA trade deal with Canada

Published:Friday | February 17, 2017 | 2:00 AM
Activists stage a demonstration against the CETA trade deal outside the European Parliament in Strasbourg, eastern France, Wednesday, February 15, 2017.

The European Union and Canada on Wednesday cast their newly approved trade deal as a much-needed beacon for cooperation, with the EU criticising President Donald Trump's protectionist bent as a threat to the continent's prosperity.

After about seven years of negotiations, the EU parliament approved on Wednesday a deal with Canada that will eliminate most tariffs for business between the EU's economy of half a billion people and Canada's 35 million.

Canadian Prime Minister Justin Trudeau on Thursday hailed the new trade pact in Europe, telling the EU parliament that the deal they approved will create jobs and boost the middle class on both sides of the Atlantic.

In his address, the first by a Canadian leader to the European parliament, Trudeau said "trade that is free and fair means that we can make the lives of our citizens more affordable."

He presented the Comprehensive Economic and Trade Agreement - CETA - as a "blueprint" for future trade deals and the outcome of Europe's and Canada's shared history and values.

Progressive voice

Though critics claim CETA will mainly help large companies, proponents say it will create jobs and wealth. And, they argue, it is a sorely needed reminder of the world's capacity to cooperate at a time when political forces, even within the EU, want to bring back national barriers to migration and trade.

"This is the vote that the world was waiting today to hear - whether there will be a progressive voice in the world," said Canadian International Trade Minister Francois-Philippe Champagne during a visit to Brussels, coinciding with the approval on Wednesday. "Canada and Europe, I am glad to say, came up to this challenge and sent a very strong signal to the world."

The future of global trade was put in doubt after Trump nixed a trade deal with Pacific countries, threatened to get tough on China, and renegotiate a free trade pact with Mexico and Canada. In Europe, political parties opposed to the EU's message of shared markets and open borders for workers are doing well in the polls ahead of elections in countries like the Netherlands and France.

The EU parliament approved CETA by a wide margin of 408 for, 254 against with 33 abstentions, allowing for its provisional entry into force as early as April.

Protectionist Trump

At the same time as the EU lawmakers were voting, the bloc's executive also took aim at Trump.

"While we do not yet know the details of the policies the Trump administration will pursue, we do know that their instincts will be protectionist more than ever," said Pierre Moscovici, the EU's economic and financial affairs chief, at the University of Athens.

The belligerent mood was also palpable at the EU's legislature in Strasbourg, France.

"President Trump has given us another good reason to intensify our links with Canada while Trump introduces tariffs, we are not only tearing them down, but also setting the highest progressive standards," said Guy Verhofstadt, the leader of the EU parliament's ALDE liberal group.

The EU vote should close the drawn-out approval process across the 28 member states, where some governments and legislation had tried to modify or scupper the deal. The Netherlands could conceivably still hold up the deal if it demands an advisory national referendum.

Trade between the EU and Canada amounts to more than €60 billion (US$63 billion) a year, and the EU expects the deal to boost this by 20 per cent by removing almost all tariffs.

Critics say it could dilute standards for food safety or labour rights by giving more power to big corporations.

Outside the EU parliament on Wednesday, demonstrating activists were vocal about their worries about the deal.

"What will happen is more and more deregulation, less social protection for citizens, for small companies, for independent workers," said Maika Fernandes, who had travelled from Alicante, southern Spain. "No one will be able to compete with the multinationals. It will be a financial Europe that will favour only big multinationals."

EU trade chief Cecilia Malmstrom tried to assuage those concerns saying it "will not change food safety standards or any other EU requirements. Only the EU institutions can do that."