Reuters is reporting today that free trade negotiations between Canada and the EU are stalled on issues of public procurement, services and investment, and that because of the wide distances between Canadian and EU positions, it is unlikely CETA can be concluded by the end of 2011 as the Harper government and European Commission had hoped. This is good news, though we’re not ready to run a victory lap just yet. From our conversations with provincial trade negotiators in Brussels this week, there is still a strong commitment to seeing these trade talks through.
Both Canada and the EU were expecting this week in Brussels to be a breakthrough in the negotiations. If services and procurement could be shelved, the provinces could be taken out of the picture, allowing federal and EU negotiators to tackle difficult agricultural and intellectual property issues during a final October round in Ottawa. Luckily for us, things will not be so easy.
According to Reuters, referring to information gathered from Jason Langrish of the Canada-Europe Roundtable for Business (CERT), EU member states have “taken longer than expected to agree what guarantees a pact should offer for Canadian investments in Europe and European investments in Canada, particularly in the energy and mining sectors.” And there is still “disagreement over how far Canada will go in allowing European bids for public contracts.”
“It’s clear the delay is on the European side,” Langrish says, and in fact this is what Canada’s lead negotiator, Steve Verheul, told members of the Trade Justice Network and Quebec Network on Continental Integration during a briefing on Tuesday evening. But it is equally possible that the EU is dissatisfied with provincial offers on procurement, which, according to Verheul, will exclude hydro utilities and transit — both major priorities for European firms wanting hoping to collect a bigger portion of the $100-200 billion in subfederal government contracts dished out annually.
In fact, we were told by friends in Brussells this week the EU might want to wait until after provincial elections this fall to continue with procurement discussions. In B.C. and Ontario in particular there may be sea changes in government, with a strong role for the CETA-skeptical NDP. When you think of it, there is a very good argument that this round of negotiations should not have taken place at all given the provinces and federal government are prorogued for the summer. Adrian Dix, newly elected leader of the B.C. NDP, issued a statement this week problematizing the procurement and drug patent reforms proposed in CETA. Andrea Horwath, leader of the Ontario NDP, has told TJN members she would not support CETA in its current form.
But delays, if they are really from the EU side, might also imply concerns with how public services or other public health and environmental policies would be affected by new investment protections in CETA. We have been flagging this with EU lawmakers on multiple trips to Europe, including the one I’m on now with the Trade Justice Network.
On Tuesday afternoon we addressed a Public Services Intergroup meeting on the threats to public services in CETA’s broad procurement commitments and potentially reduced definition of what constitutes a “public” service. Both the European Commission and AquaFed, the international federation of private water operators, showed up to challenge the presentation of Larry Brown, national secretary-treasurer of the National Union of Public and General Employees. This felt like damage control but most of the 60-odd members of parliament and others in the room agreed with us that there was strong cause for concern. The goal of CETA is to push the envelop on services liberalization — to set a new benchmark for neoliberal governance in the interest of private service suppliers. It was incredible (in both senses of the term) when the AquaFed representative claimed he had no interest in privatizing Canadian water systems, or that he had no idea what was in the CETA text.
Tomorrow is the final day of this 8th round of CETA talks. We may or may not know by then whether the offers on procurement were exchanged. Verheul told us on Tuesday night if this step does not happen by Friday it won’t until October.
No one should mourn the lack of progress. The Eurozone is near meltdown with Greece and perhaps even Italy on the brink of insolvency. As a friend from the Green group suggested to us this week, Germany and France can handle export-led growth–the ultimate goal of free trade agreements and liberalization–but smaller countries such as Greece and Portugal cannot. It’s not a failing but the fault of the particular model of growth which Canada and the EU are foolishly trying to chase in CETA. The world strives for food security and the Harper government wants more food exports. We need the social security of affordable public services but Harper and the EU want to privatize. This must be a too rarely diagnosed form of madness.
The Trade Justice Network will leave Brussels this week stronger than when it came. European allies are more and more concerned about Canada, and not just because we are the nation of seal-killers, asbestos exports and tarsands, though these are very important factors in EU politics. An EU parliamentary resolution on Canada-EU trade relations last month raised many of the same issues we’ve been raising with local and provincial governments at home. They see in CETA the reproduction and amplification of a failed model of economic development which transfers wealth upwards not outwards, and prioritizes profits over social and environmental security. Let it stall, and let’s make sure we put the blame where it’s needed — on the transfer of public goods into private hands that free trade from its very origins was designed to encourage.