Stakes are High in the EU-Canada Trade Deal | The Mark (external - login to view)
Stakes are High in the EU-Canada Trade Deal
by Stuart Trew (external - login to view) Trade Campaigner, Council of Canadians
The Harper government is being less than transparent as critical issues remain in the debate.
On July 15, the Harper government announced (external - login to view) that significant progress had been made in the Comprehensive Economic and Trade Agreement (CETA) negotiations with the European Union. A media release said both sides had exchanged “ambitious” offers on goods (tariffs) and procurement. A few news articles elaborated on what “ambitious” might mean (because it isn’t obvious). Others acknowledged sticking points in agriculture and intellectual-property rights that may be difficult to resolve over the next few months. One high-profile columnist questioned whether a deal that included major drug-patent reforms and bans on local preferences in public contracts – big requests on the EU side –made any sense.
Relatively speaking, this was a lot of media attention for a trade deal that Harper is trying to rush into being with as little discussion as possible. Maybe CETA is controversial after all. A growing number of Canadians and Europeans certainly think so.
The same morning that the government announced success at the eighth round of CETA talks, the Trade Justice Network and Réseau québécois sur l’intégration continentale issued a joint statement (external - login to view) from Brussels, where member organizations, including the Council of Canadians, had been meeting lawmakers, labour unions, environmental groups, and activists in England, France, and Belgium. We were outnumbered, and massively outfinanced (external - login to view), by the Canada-Europe Round Table for Business (CERT), but that didn’t matter. The case for CETA in Europe appears to be weakening.
For example, a European Parliament resolution (external - login to view) passed on June 8 asked why Canada and the EU would include a controversial investor-state dispute process in CETA when the domestic courts on both continents can handle commercial arbitration. As an example, the resolution, “Draws the attention to different policies enacted by the EU and Canada regarding the regulation of Genetically Modified Organisms (GMOs),” and “warns that the stricter regulations enacted in the EU could be challenged by private companies.” The Indian government has apparently rejected (external - login to view) similar investor rights in its free-trade deal with the EU.
The Philip Morris case against Australia’s public-health warnings on cigarette labels probably affected that decision. Philip Morris claims the labelling law violates a bilateral investment treaty (BIT) between Hong Kong – where the firm is based – and Australia. This past April, the Australian government declared that it would no longer include BITs in its trade deals. “If Australian businesses are concerned about sovereign risk in Australian trading partner countries,” said the new policy, “they will need to make their own assessments about whether they want to commit to investing in those countries.”
It’s doubtful that the European Commission or Council would take the same position on investment, but the EU Parliament is clearly upset that the CETA negotiations are moving in that direction before the EU has voted on a new continental investment policy to replace the various inter-state and international treaties that are currently in effect. The lack of a clear policy won’t stop the CETA talks, but it will annoy the Harper government since NAFTA-like investor protections in CETA are, conspicuously, one of the federal government’s only real requests of the EU.
The EU Parliament resolution of June 8 also asks Canada to cancel its World Trade Organization (WTO) challenge to the Europe-wide seal-product ban or risk losing Parliament’s support for CETA. And it suggests the EU Commission should lay off Ontario’s Green Energy Act as a “sign of good will.” Much loved by environmentalists, the act is a whipping post for free traders and multinational wind and solar firms that would prefer not to meet the province’s domestic content quotas on renewable projects. Japan has taken Canada to the WTO, claiming that Ontario is illegally subsidizing local production while U.S. investor Boone Pickens is pursing a NAFTA investment challenge against the act. Ontario's green-energy plan would be illegal under CETA’s procurement chapter, which would be fine with Harper, who clearly enjoys the status-quo do-nothing approach to climate change.
Speaking of which, Canada’s incessant lobbying against a proposed clean-energy policy is annoying the Europeans. This, too, could affect the CETA negotiations.
On July 12, at a public event in the EU Parliament – organized by the U.K. Tar Sands Network, the Indigenous Environmental Network, and the Council of Canadians – panelists made connections between the tar sands and CETA for members of the EU Parliament and their staff. It’s not just that Canada has threatened the negotiations (external - login to view) if the EU’s Fuel Quality Directive eventually includes a default carbon-content value for tar sands, but also that CETA’s investment protections and regulatory co-operation chapters give investors, and the Canadian or EU governments, tools to frustrate environmental policy. Harper is even contesting the EU’s modest attempts to include language in CETA that would recognize the legally binding nature of multinational environmental treaties.
In Canada, the widely leaked intellectual property chapter in CETA has created enormous controversy for arts and cultural groups, the internet-user community (for lack of a better term) represented by Michael Geist (external - login to view), and generic drug manufacturers. A credible study (external - login to view) from the latter predicts that the drug-patent extensions and data-protection terms sought by the EU, and supported by Canada’s brand-name drug companies, would increase the cost of public and private drug plans by almost $3 billion annually. Neither publicly funded health systems nor corporate insurance plans could afford that.
The Harper government deflects these awkward facts by claiming the negotiations are ongoing, that he’s looking out for Canada’s interests, and that he wouldn’t sign a bad deal. In a democratic society like ours, those answers shouldn’t be good enough for the public or the media.
The Trade Justice Network has posted two leaked versions of the CETA text to its website (external - login to view). Canada’s federal negotiators continue to offer post-round briefings with civil-society groups, including labour unions, academics, environmental organizations, and, of course, the big-business lobby. Provincial negotiators are also accessible. In Brussels, we met with representatives from six provinces. These are not consultations by any stretch of the imagination, but they do provide important details about the transatlantic negotiations that anyone, including journalists, can access.
Though we’re missing critical details about what the provinces, territories, and federal government have offered the EU in terms of goods and procurement, there is enough information out there to start a debate on the merits of CETA for Canada. If we don’t start the debate soon, we may miss the opportunity completely. Provincial and federal negotiators will meet twice in September to finalize Canada’s procurement and goods offers to the EU. Then, prior to the ninth round of talks in Ottawa (October 17-21), another exchange in services and investment will happen. An obvious question we should be asking is how provinces facing elections in the next few months can get away with binding new governments to a trade deal they may not agree with.
Clearly, CETA is about much more than trade. It’s about economic governance, which is all of our business. It’s about how we protect the environment, create jobs, and regulate commerce. These are political choices, not technocratic ones fit for trade negotiators or federal and provincial executive-level decision-makers. The federal and provincial governments should come clean, show us what they're offering, and give their voters a chance to decide what a comprehensive agreement with the EU should look like.