After many years of blocking, disputing and even outright obstruction from a region in Belguim it has been announced this week that CETA, the free trade agreement between Canada and the EU, has finally been passed. The European Union Parliament approved the Comprehensive Economic and Trade Agreement 408 votes to 254, which effectively means that most of the deal can enter into law as soon as March.
So what’s the big deal?
Supporters of the agreement say that CETA will be a catalyst for creating jobs and investment on both sides of the Atlantic, but those who argue against it claim that this trade deal will enable the introduction of lesser quality goods and products from the North American market into the EU. On Wednesday the grounds of the European Parliament in Strasbourg saw a small demonstration of around 700 hundred protesters. While the deal will continue to hit some speed bumps, one thing is for sure: that the whole economic sphere has changed drastically with the arrival of Trump and his anti-globalisation economics. But looking at the facts on the deal it now seems like a hot ticket for an alternative to the fast deteriorating relations between the United States of America and the rest of the economic world.
CETA will eliminate almost 99 percent of customs duties between the two sides, which will be of huge benefit to European exporters. In 2016 the EU exported 37 billion euros (US$39 billion) of goods and services and imported 30 billion euros from the North American nation, according to Statistics Canada. A joint EU-Canada study forecast the deal would increase bilateral trade in goods and services by more than 20 percent.*
While Trump introduces tariffs, we are not only tearing them down but also setting the highest progressive standards. #CETA
— Guy Verhofstadt (@guyverhofstadt) February 15, 2017
For and against CETA
It wasn’t an all agreement situation in the Parliament however, with the usual anti-EU leaders such as Front National’s Marie Le Pen stating that this deal meant that “Multinationals will be able to attack governments in a privatized court system.” Along with the far right groups, number of the far left, as well as the Greens and some Socialists also voted against the deal.
Major groups in the EU Parliament backed the agreement – the European Peoples Party, the Christian Democrats, the ECR Conservatives and the ALDE liberals.
A potential partner in many ways
It is hoped that the current administration in Washington will be a four year affair, or even less, and in the meantime, the EU has enabled itself to have strong presence on the American continent. The current Canadian government under Justin Trudeau is what the EU needs in a trade partner as both share similar social ideologies which seem to be so important with regards to international state relations now. Trudeau would easily fit into any leadership in the EU and the common market is no more truer to the name than in CETA. Trade agreements always have pitfalls and it is almost impossible to have a one size fits all agreement, but in Canada we are working with a nation that is traditionally in harmony with European values and would probably be an automatic member of the EU if this was possible. The Canadian administration has had a constant headache with the swing of Republican and Democratic governments in the US over the years and thus has vast experience in maintaining a calm approach to such goings on as in Washington these days.
What must be top of the agenda now is solidifying the current agreement with the EU and Mexico (FTA EU-MX) and ensuring a show of force in defiance of the Trump administration’s threats to be an enabler of the break-up of the EU. As bold statements go, Trump’s predictions of the EU demise are nothing but hyperbole and his predictions will look more foolish should there be renewed co-operation with the US’s surrounding neighbours. This may be an aggressive policy and even quite unusual, but it is unfortunately a necessary step for European economics, investment, trade and co-prosperity.
*Source; Deutsche Welle (DW)
Photo source – Francois Lenoir/EPA via Canadian Press