EU and Canada win a trade battle — but not the war

Leaders say they’ll have to redouble efforts to rescue trade agendas from hardening anti-globalization sentiment.

Relieved EU and Canadian leaders claimed they had won a decisive battle Sunday by finally signing a landmark trade accord that in recent months had often seemed close to collapse.

They also expressed fears that the war was far from over.

The officials joyous at the signing ceremony stressed they would have to redouble efforts to rescue their trade agendas from hardening anti-globalization sentiment on both sides of the Atlantic.

Canada’s Prime Minister Justin Trudeau traveled to Brussels to conclude the paperwork, unscathed by a technical glitch that forced his plane to return to Ottawa and an unusually successful assault on the European Council by protesters, who daubed the building in red paint.

In a jovial session of embraces, kisses and back-slapping, Trudeau joined EU leaders in signing the bible-like tomes of the Comprehensive Economic and Trade Agreement. “Together, we have come to a historic agreement that will protect and will advance the economic and social well-being of 543 million people,” he said.

The relief was palpable after CETA had to run a gauntlet of opposition in Germany, Austria, Romania, Bulgaria and finally in the Belgian region of Wallonia, where objections over the past two weeks threatened to scuttle seven years of diplomatic efforts.

European Council President Donald Tusk acknowledged the “battle for CETA” revealed that the EU was entering a new phase in which it was finding it harder to persuade the public of the benefits of free trade.

“It shows that facts and figures won’t stand up for themselves alone, that post-factual reality and post-truth politics pose a great challenge on both sides of the Atlantic,” he said.

“Free trade and globalization have protected hundreds of millions of people from poverty and hunger. The problem is that fewer people believe this.”

Tusk’s remarks cut to the heart of what has become one of the EU’s chief concerns — the extent to which the European Commission can regain its exclusive competence over trade policy that it surrendered to member countries in the case of CETA. Those national authorities are increasingly challenging Brussels, reflecting what they see as their electorates’ growing mistrust of free trade.

More battles ahead

Although CETA is expected to come into force on a provisional basis early next year after ratification by the European Parliament, it will still need to be approved by national parliaments before it receives its final “definitive” approval. This again opens the pact up to potential vetoes, which Greenpeace argues could prove to be its undoing.

“This agreement will probably not survive the democratic and legal scrutiny of the ratification process over the coming months,” the group said in a statement.

CETA’s opponents say that it will undercut Europe’s legal, health and environmental standards — something that Ottawa and Brussels adamantly deny.

Some trade experts have criticized the Commission for designating CETA as a “mixed agreement” — requiring approval from 38 regional and national assemblies.

This precedent raises a daunting challenge for European Commissioner for Trade Cecilia Malmström to determine how to ratify future accords. Vietnam and the EU finalized a free-trade deal in December 2015 and the EU wants to close another with Japan by the end of the year.

The prospect of a CETA-like conflict over every trade deal is a massive potential disincentive to the EU’s trade partners.

Malmström conceded the growing skepticism over free trade but argued that the anti-globalization movement would simply allow countries with lower standards than the EU and Canada to set global norms.

“We [now] have two options: We can take an easier path and pretend that we can reverse the tide of globalization, closing our doors to the world. Or we can take the more difficult path and try to shape globalization according to our vision.”

In the case of CETA, Trudeau argued that the accord itself would allay public fears when it came into force provisionally, lessening the chances that an EU parliament would seek to torpedo the pact next year.

“One of the key points is that provisional application represents about 98 percent of what is in CETA and the economic benefits will start to flow right away as soon as the European Parliament and Canada move forward hopefully which will happen in the coming months. So small businesses, consumers will start to feel the benefits of this immediately.”

Tusk agreed. “I have no doubt that the so-called provisional application, the implementation, the practice, will be the best form of education. Much better than persuasion or words.”

But after the EU’s showdown with Wallonia in recent weeks, he was taking nothing for granted.

“This for me is the main grounds of our very cautious optimism,” Tusk said. “After the last weeks, we have to be very cautious.”

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