Score one for the global technocracy: The European Union appears to have salvaged its faltering free trade deal with Canada, after officials struck a deal with the Belgian politicians who were blocking its ratification.
Last week, it seemed the Comprehensive Economic and Trade Agreement, aka CETA, which the EU and Canada have been negotiating for seven years, was on the verge of unraveling thanks to opposition from the parliament of Wallonia, Belgium’s French-speaking region of about 3.5 million people. The EU requires unanimous backing from its members in order to approve new trade pacts, but Belgium’s federal government could not officially sign on without the support of its regional governments, including socialist-led Wallonia, where lawmakers voted to reject the deal. (They were later joined in opposition by MPs representing Belgium’s German-speaking community and local MPS in Brussels.) Some frantic negotiations with the Walloons broke down, Canada’s trade minister told reporters she wasn’t sure Europe was capable of sealing a trade pact at this point in time, and Prime Minister Justin Trudeau was forced to cancel a trip to Brussels for a planned signing ceremony.
But apparently all was not lost. On Tuesday, Belgian Prime Minister Charles Michel confirmed that the leaders of all five regional parliaments had struck a bargain to approve CETA. The Walloons were apparently pacified by a four-page document that, among other things, addressed their concerns about the arbitration system known as investor-state dispute settlement, which after years of being included as a standard feature in international trade deals has become controversial due to fears about corporate abuse and national sovereignty. Under the compromise, “Belgium would be able to go to the European court of justice to determine whether the new investor-state special tribunals are compatible with EU law,” according to the Guardian. CETA isn’t home free yet—the Walloon concessions still need to be approved by all parties. But the major road block seems to be out of the way.
So I suppose there are at least two ways of looking at this. The Financial Times says the whole bizarre incident, in which a tiny regional government nearly scuttled a landmark trade agreement impacting more than 500 million people, is a big black mark for the EU.
The Ceta affair has been deeply embarrassing for EU leaders, who had hoped the deal would set a benchmark for the world and prepare the ground for the even bigger Transatlantic Trade and Investment Partnership pact with US.
Instead the affair has raised questions over the ability of the EU to conclude complex agreements that require the support of all the parliaments in the bloc.
I think that’s fair to an extent. But here’s a glass-half-full version. In an unusual move, EU officials chose to give national parliaments and, in cases like Belgium’s, regional governments, veto power over CETA partly because they wanted to make sure it had democratic legitimacy in the wake of Brexit, which had raised the specter of a mass anti-globalization backlash. One could argue that it was absurd to hand local lawmakers in places like Wallonia the power to kill such a large endeavor. But after last week’s near-death experience, the gamble seems to be panning out. Free trade may have just passed a very tough test in Europe.
