Will CETA be implemented after eight long years or it will be vetoed by the EU citizen?

From left to right: Mr Jean-Claude JUNCKER, President of the European Commission; Mr Justin TRUDEAU, Canadian Prime Minister; Mr Donald TUSK, President of the European Council; Mr Robert FICO, Slovak Prime Minister. Location: Brussels - BELGIUM Date: 30/10/2016 Copyright: European Union Source: EC – Audiovisual Service

From left to right: Mr Jean-Claude JUNCKER, President of the European Commission; Mr Justin TRUDEAU, Canadian Prime Minister; Mr Donald TUSK, President of the European Council; Mr Robert FICO, Slovak Prime Minister.
Location: Brussels – BELGIUM
Date: 30/10/2016
Copyright: European Union
Source: EC – Audiovisual Service

It was last Sunday when the EU and Canada signed the free trade agreement CETA (Comprehensive Economic and Trade Agreement), despite the protest taking place just outside the European Council’s building. This deal is meant to create more jobs and growth through stronger economic relations.

However, the approval of the national parliaments in Europe and of the European Parliament (EP) is mandatory in order for CETA to be fully implemented. The fact that lots of people are fiercely against it and believe that it will damage consumers’ and workers’ rights, by providing extra power to multinational companies, is not encouraging for the future of this trade pact.

CETA at what cost?

CETA is the instrument that aims to increase bilateral trade by 12 billion euros per year boosting the sluggish European economy. Canada would also be benefited by reducing its dependence with the U.S. as an export market.

But there are some points in the trade agreement that could be dangerous and unfair for smaller companies, environmental standards and workers’ and consumers’ rights. The Investor State Dispute Settlement (ISDS) clause is one of them, since it grants the privilege to the Canadian firms to sue governments in case new laws affect their profits and consequently causes serious concerns to the EU citizens.

There are examples that prove that the ISDS system has been used in the past for the benefit of corporations. Particularly in the North American Free Trade Agreement (NEFTA), Metalclad, a U.S. landfill management firm sued the Mexican federal government over a local government’s decision to deny a permit to operate a toxic waste dump. Local citizens at the time urged their government to deny the permit in fear of water supply pollution. The outcome of that dispute was that Metalclad won more than 15 million dollars.

According to Pascoe Sabido from the Corporate Europe Observatory, this agreement hands over the power to large corporations. More specifically, Pascoe Sabido said that: “This has been a deal written by, and with, big business. You can see it in who’s coming out. SME’s (small and medium-sized enterprises) have said, ‘We’re not in favor of CETA or TTIP.’ Those who are cheerleading it are those very same big businesses so you have more rights being handed over to big business, you have their investors being protected, and ultimately what we’re seeing is the profits of the biggest businesses put before the interests of European citizens and those across Europe who actually want to have a decent quality of life.”

Protests around the signing ceremony

The bumpy road to the signing of CETA was full of massive protests which broke out in several EU countries revealing the opposition of a great part of EU citizens to this trade deal. Even last Sunday and while the European officials were signing the trade deal with the Canadian Prime Minister, protesters attempted to enter the European Council building in Brussels by breaking the security fence. The latter led to serious escalations and 15 people were detained by the Belgian police.

It seems that people together with organizations against free trade pacts will keep on fighting against the CETA implementation as they see that there is still time. The national and regional parliaments in Europe together with the EP are now left to decide whether they consider CETA an agreement that can create more opportunities upgrading the well-being of EU citizens.

Wallonia’s resistance against CETA

Wallonia managed to block CETA and delay its signing showing that even a small region has the power to change the outcome of such a trade deal. The question now lies on whether other countries will hold similar stance putting barriers to the implementation of this economic agreement which aims also to create business opportunities for EU corporations in Canada. In case that the EP decides to consent CETA will come into effect partially in the beginning of 2017.

The future of free trade agreements

The signing of CETA inescapably paves the road for the Transatlantic Trade Agreement (Transatlantic Trade and Investment Partnership – TTIP) between the EU and the U.S..

However, the magnitude of TTIP and the negotiations that have been undertaken so far do not reveal that there will be an agreement in the near future. It is also a fact that Brexit has caused serious turbulences within Europe creating significant nationalistic sentiments which undermine such trade deals.

All in all, it seems that the EU citizens are realising more and more that free trade agreements aim mainly at the profitability of large multinationals and not at their own prosperity.

Consequently, it is up to each and every national government to decide now what is best for its citizens and act accordingly.

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