After more than seven years of negotiations, a trade agreement between the E.U. and Canada known as the Canadian-European Trade Agreement (CETA) was supposed to have passed into law this month and — on the original schedule — would’ve been ratified by now.
No one now expects ratification this year and many are questioning whether the free trade agreement ever has any hope of being accepted by Europe’s 27 member states. Opposition has been widespread says an article in the Telegraph explains.
Particular mention is made of the regional government of Wallonia (a German-speaking region of Belgium) but, in practice, opposition has been widespread, even resulting in street demonstrations in Germany and an announcement by the Austrian government that they intend to veto acceptance.
To illustrate the complexity of the problem, any free trade agreement like CETA has to be approved not just by national but even, in many cases, by regional governments in Europe before the E.U. can pass it into law.
How Little Wallonia Can Scuttle Trade Deals
Wallonia’s socialist parliament has decided to veto the deal. if Wallonia doesn’t agree then Belgium can’t ratify the treaty and if Belgium can’t agree then the E.U. can’t ratify in turn. End of deal. As we have seen during the recent U.S. presidential election with the popularity of Donald Trump and the growing anti-free-trade position of Hillary Clinton, populist movements are turning against free trade and the perceived inequalities that it brings.
In Europe, most of the continent is now fundamentally opposed to free trade and, as the Telegraph says, the process of negotiating an agreement has become so tortuous with so many competing interests potentially able to block it that it raises questions as to whether the UK will achieve anything other than a “hard Brexit” and be forced to fall back on World Trade Organization rules of engagement.
A less threatening trading partner than Canada is hard to imagine, yet the Progressive Caucus of the European Parliament is quoted in the Telegraph as saying the CETA agreement would foster excessive liberalization and deregulation, and that it would weaken government’s right to regulate in the public interest.
Free Trade Under Assault… From the Left
Left-wing groups across Europe are worried that free trade undermines democracy and environmental standards by giving too much power to foreign corporations to take legal action against governments, but failed to implement terms of the ratified agreements. Yet it has been proven, time and again, that free trade is part of the process that makes countries richer and has done so for hundreds of years.
Yes, there are winners and losers as countries find what products or services they can produce more competitively than others, but over the centuries this has allowed countries to specialize in what they do best and often raised rather than lowered standards as a result.
Some sections of American society and media may have reservations about Trans-Atlantic Trade and Investment Partnership, but in the current climate in Europe there is not a hope in hell that would ever be ratified.
After four decades of slow and one decade of stagnant growth, Europe is increasingly turning inwards. Like many introverts. Europe is blaming the world for its woes and, in spite of the best efforts of some politicians, societies are turning away from open trade and calling for protectionism.
CETA is probably dead in the water. It will be an amazing political coup if Brussels actually manages to get it past it’s 27 national and additional regional governments next year. If Europe cant ratify CETA, TTIP has even less chance.