Last week, Canada’s lead negotiator in the Comprehensive Economic and Trade Agreement negotiations with the EU gave civil society groups and academics another state-of-play update. Normally I would try to post a close-to-verbatim summary of the discussion but my Google phone call conked out when I temporarily lost my wireless signal. I caught the beginning then came back for the Q+A. Luckily, there are people like Claude Vaillancourt of ATTAC-Québec who took and then circulated some very good notes. The following combines the two accounts.
1. The negotiations are far from being completed. There will be negotiating sessions in June in Ottawa, July in Brussels, then two more scheduled for September and October. There’s some slow slogging through technicalities.
2. Cleaning up and “improving” the services and investment offers, which were first exchanged in October last year then again in February, is proving more challenging than expected. The two sides expect to exchange “targetted offers” during a July round of negotiations in Brussels.
3. The EU’s strict rules of origin are making it difficult for Canada in areas like automobiles and some fish products. For example, most of Canada’s fish exports are entirely originating in Canada and Canadian waters but some, like lobster, are imported from the U.S. and processed in Canada for export to other markets. On automobiles, news articles suggest the EU is sticking to its 50% Canadian content requirement for tariff-free access to the European market, which is impossible for North American automakers to meet. Rules of origin will be a main topic during a June negotiating session in Ottawa.
4. On investment protection, there was progress on a draft text during a negotiating session in Brussels over the past few weeks. According to Canada’s negotiator, there are differences on how to balance a government’s “right to regulate” with protection for investors. (This would be heartwarming if we didn’t know the federal government considers it a myth that “Free trade agreements allow foreign investors and foreign companies to challenge Canadian laws and regulations.” They do, and Canada is the 6th most sued country in the world under the investor-state regime.)
5. On postal services, DFAIT said there had been no new discussions. The Canadian Union of Postal Workers has written to the federal government asking why, if the EU wants a strong Annex II protection for postal services, which creates policy flexibility in the future to expand public services, Canada only wants to protect the existing public system with a weaker Annex I reservation. But the lead CETA negotiator seemed to imply Canada “would go a similar direction,” and that while the EU was going hard on postal at the beginning, their negotiators have since backed off.
6. On copyright, the negotiator said the Harper government’s move in Bill C-11 to adopt the WIPO internet treaties was a big issue for the EU. While EU negotiators have some outstanding concerns “they are satisfied with the direction” of the talks, and “Our expectation at this stage is that they’re reaching a level of comfort and are starting to think about if they wanted to push hard for some limited additional gains, it would be costly for them in other areas.” Canada’s negotiator added, “We haven’t seen which side they’ll come out on but the signals indicate they’re largely satisfied with where [the talks] headed.”
7. Canada and the EU have “closed the gaps” on language they’d like to see on biotechnology (GMOs). Canadian negotiators are pushing for greater cooperation in the development of biotech policy through the existing biotech working group. For a rather anti-science crowd, Harper and DFAIT want language like “science-based assessments” put into CETA, probably as wedge to help open the door to more GMO exports down the road (since Canada’s science says they’re all good), although Canada’s negotiator says, “We reached the conclusion a while ago that we will not be able to impose our views on biotech on European consumers,” there’s room to “make our systems work effectively together.”
8. Financial services came up in March and April. “The main issue remains the prudential carveout,” said the DFAIT negotiator. “On our side we want to make sure regulators have enough flexibility to regulate in a way that protects the banking and insurance system so we can avoid crises.” The discussion is heavily influenced by what’s happening in financial markets in Europe but also around the world, he added.
9. For European companies, the more important outcome of the CETA will be better access to the U.S. market. (There are ongoing discussions between Obama and the EU on a comprehensive free trade and investment pact, with the U.S. Chamber of Commerce claiming recently that fear will be the winning recipe for bringing the two sides together — fear of getting the economy going again. How interested are U.S. business lobbies in the CETA talks? I met a policy manager with the European-American Business Council during a reception in Ottawa last week for three travelling MEPs on the EU’s permanent delegation on Canada. And why wouldn’t they be interested? Even if an EU-U.S. pact is far away, U.S. firms will get Most Favoured Nation access to the Canadian market under CETA in most parts of the deal without having to give Canadian firms the same access in the U.S.)
10. The Quebec government is still trying to protect its liquor board (SAQ) and Hydro Quebec despite pressure from the EU. There has even been a rapprochement on the idea of a cultural exemption, which is very important to Canadian and Quebec artists, authors, publishers and other cultural sector workers.
These were the fine points. On the bigger political picture, like a possible (now actual) socialist as president in France, the Canadian haranguing of EU member states on the Fuel Quality Directive, Canada’s visa requirements of Czech, Hungarian and Romanian travellers (there were several Citizenship and Immigration Canada people at the MEP reception last week, too), the seal hunt and Canada’s WTO challenge to the EU seal product ban, Canadian negotiators and politicians continue to say there will be no impact. But in the same breath they tell us the CETA talks will come down to hard political decisions at the end of the day.
It’s clear that Canadian opposition to CETA is having an effect, despite government attempts to downplay it. If you look at Harper’s latest “myths and realities” section on its new CETA web page, you’ll see they are trying to answer all the critiques the Trade Justice Network and RQIC in Quebec have been making. Except for #6, that is — no one has ever suggested CETA could lead to water exports to the EU. Myth #9 is not a myth since intellectual property changes proposed by the EU are guaranteed to increase drug costs. And Myth #11, that the CETA negotiations aren’t secret, is just plain funny.
For more information about the CETA negotiations see the Council of Canadians web page or the Trade Justice Network website.
