Canada working with European Union on clarifications to save trade deal

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International Trade Minister Chrystia Freeland will head to a meeting of European trade ministers next week to negotiate a last-minute addition to the Canada-EU trade deal aimed at salvaging the pact.

Faced with growing concern about the European Union’s ability to ratify the deal Freeland once called “gold-plated,” Canada is collaborating on additional text to clarify its more controversial provisions.

The potential annex to the Comprehensive Economic Trade Agreement (CETA) would not constitute a reopening of the negotiations — something neither side wants to do.

But vague language in the current text is allowing critics of the deal to paint it as a threat to the quality of public services and the ability of governments to regulate in areas like environmental or labour standards. The annex could offer legally binding clarifications to fix that.

Prime Minister Justin Trudeau met Thursday with Germany’s Trade Minister Sigmar Gabriel, the leader of the Social Democratic Party who serves as vice chancellor in a governing coalition with Angela Merkel.

A statement said the pair “discussed the value of considering proposals to further build on CETA with regards to investment protection, workers’ rights, and public services including procurement.”

Freeland and her EU counterpart, Cecilia Malmstrom, are working “to strengthen the progressive elements of CETA by clarifications in a declaration with legal status,” it said.

Drafting a new annex to alleviate concerns late in the ratification process would not be unprecedented for an EU trade deal. A last-minute declaration on labour rights was added to the EU’s free trade agreement with Peru and Colombia, for example.

Key talks Thursday

Freeland’s appearance at a meeting of European trade ministers in Bratislava, Slovakia, on Thursday is part her latest push to save the deal. The new declaration could be finalized late next week between the 28 member countries if remaining skeptics come around.

But first, on Monday, she’ll speak at a conference of the Social Democratic Party in Wolfsburg, Germany.

After more meetings in Berlin, she’ll head to Vienna Wednesday to twist the arms of still-reluctant Austrian leaders.

If all this persuasion works and a consensus can be reached on the European Council moving ahead with the deal, Trudeau would head to Brussels for a summit and signing ceremony with EU leaders in late October.

CETA would still need to be ratified by the European Parliament later this year or early next year. Then the bulk of the deal could be provisionally applied.

For jurisdictional reasons, the EU decided last summer that individual countries need to vote on a few parts of the deal before the full agreement takes hold.

Talks are still underway in Europe to determine how much of the deal could apply provisionally.

Large protests expected this weekend

An association of trade-skeptic civil society groups and trade unions are expecting hundreds of thousands of protesters in several German cities on Saturday.

The “Stop CETA and TTIP” coalition says the European Union’s negotiations with Canada and the Transatlantic Trade and Investment Partnership (TTIP) talks with the United States are a threat to European democracy.

While productive negotiations with Canada were once billed as a precedent for a future American trade deal, European leaders now emphasize how the final Canadian text is different from what the U.S. wants. TTIP talks are not expected to conclude successfully any time soon.

CETA’s investor-state dispute settlement provisions, already reworked once last winter before the text was finalized, remain controversial for providing a means for companies to sue governments when regulations hurt their business.

Countries are still arguing about things like the right to appoint judges to the proposed new European investment court.

If CETA is ratified, Europeans could seek to implement the new court system for all existing and future trade deals, something progressive parties like Germany’s Social Democratic Party have sought.

The opening of government procurement — one of the deal’s big breakthroughs — has been portrayed by opponents as a threat to the quality of public services. Canada is trying to emphasize its strong public sector and recent government investments in infrastructure as evidence it shares Europeans’ values.

Critics also suggest the deal does not adequately protect workers’ rights, citing Canada’s delay in ratifying the eight fundamental conventions of the International Labour Organization (ILO).

Canada only ratified its seventh, on child labour, last June and it is not yet in force. The federal government is working with provincial and territorial governments now to ratify swiftly the final convention on collective bargaining.

Gabriel’s party to vote

Freeland’s remarks to the Social Democratic Party conference Monday will try to convince skeptics that Canada is not offside with their political goals.

The party’s membership will be voting on whether to endorse CETA.

The result would not be binding for the German trade minister Gabriel — the junior partner in Angela Merkel’s governing coalition — but a vote against would be politically damaging, after he’s worked so closely with Freeland to overcome obstacles over the last year.

Gabriel told reporters Thursday he expects his party to vote in favour.

The support of centre-left parties like his will be critical to the trade deal’s chances of ratification by members of the European Parliament in Brussels as well as in individual member states.

Last June, German trade unions, who are influential in the Social Democratic Party, joined the Canadian Labour Congress in calling for the renegotiation of CETA. The annex now being drafted would try to address some of the unions’ concerns.

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