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Belgium reaches deal with Wallonia over EU-Canada trade agreement Belgian politicians drop opposition to EU-Canada trade deal
(about 1 hour later)
The Belgian government has reached a deal to back the free trade agreement between the European Union and Canada. European Union leaders have expressed hope of signing a trade deal with Canada after Belgian politicians overcame differences that had been blocking the treaty.
The Belgian prime minister, Charles Michel, announced the agreement on Thursday, following days of negotiations with Wallonia, a region in Belgium which had been blocking the deal. The Belgian prime minister, Charles Michel, confirmed that leaders of five regional parliaments had reached an agreement with the federal government shortly after midday on Thursday. He tweeted:
The EU’s 28 member states, including Belgium, support the comprehensive economic and trade agreement with Canada, but it could not be passed without Wallonia lifting its veto. The EU needs unanimity on trade deals. Belgian agreement on #CETA . All parliaments are now able to approve by tomorrow at midnight. Important step for EU and Canada
A breakthrough was achieved hours after the Canadian prime minister, Justin Trudeau, cancelled a trip to Brussels scheduled for Thursday at which the deal was supposed to be signed. No new date has been set. The Belgian compromise came too late for an EU-Canada summit that had been scheduled for Thursday. The Canadian prime minister, Justin Trudeau, had been due to meet the EU leaders Donald Tusk and Jean-Claude Juncker in Brussels, but decided at the last minute not to get on the plane, as Belgian politicians wrangled over the agreement late on Wednesday night.
Trudeau had been expected to fly to the Belgian capital as part of a delegation including the Canadian trade minister, Chrystia Freeland, and the foreign affairs minister, Stéphane Dion. Cecilia Malmström, the EU trade commissioner leading the trade talks with Canada, said she hoped a date could be set soon to sign the accord. Tusk, the European council president, sounded a note of caution, tweeting:
Ceta, which has been seven years in the making, had stumbled near the finish line after Wallonia raised concerns over surging pork and beef imports from Canada and an independent court system to settle disputes between states and foreign investors, which critics say may be used by multinationals to dictate public policy. I am glad for good news from PM @CharlesMichel. Only once all procedures are finalised for EU signing CETA, will I contact PM @JustinTrudeau
The Belgian compromise – a four-page text that sits alongside the 1,600-page treaty – must be vetted by ambassadors from 28 EU member states and endorsed by Belgium’s regional parliaments. If these hurdles are cleared, the treaty can be signed and come into force on a temporary basis.
The comprehensive economic and trade agreement (Ceta), which has been seven years in the making, has stumbled near the finish line, amid strong opposition from the Belgian regional parliament of Wallonia.
The EU requires all 28 member states to support Ceta for the treaty to come into force, but the Belgian federal government, which has always backed the trade treaty, was barred from giving its consent because of opposition from regional parliaments in Wallonia and Brussels.
Paul Magnette, Wallonia’s minister-president, who had been leading opposition to the agreement, had wanted to re-open talks with Canada, but the EU institutions insisted that was impossible.
Wallonia has been nervous about exposing its farmers to cheap competition from Canadian farmers. Magnette had also raised objections to the proposed court system for settling disputes between foreign investors and governments.
One concession he won means 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. The four-page document also contains a guarantee that the Belgian government will assess the socio-economic and environmental impact of Ceta.
The Walloon minister-president, who has been dubbed “Super-Magnette” in the Belgian media, said: “Wallonia is extremely happy that our demands have been heard.”
The special court that Ceta would create has proved so controversial that the commission has decided it will not come into force immediately. EU member states insisted that national parliaments should have a say on aspects of the EU-Canada deal that touch on national competences.
Even if the EU and Canada sign the treaty in the coming weeks, Ceta will only become a complete and permanent legal document following ratification by at least 38 national and regional parliaments in Europe.
Full implementation of the EU-Canada trade deal would lead to the creation of an exclusive trade court to replace the investor-state dispute settlement (ISDS), the existing system for resolving trade disputes that has existed since the 1960s.
This system is written into thousands of investment contracts, including 1,400 involving EU countries. Critics have rung the alarm about the scope ISDS gives private companies to sue governments.
The cliffhanger story of the EU-Canada trade treaty is seen as a bad omen for post-Brexit Britain as it seeks a trade agreement with Europe.
Britain’s secretary of state for trade, Liam Fox, told MPs on Wednesday that the difficulties over Ceta underscored the importance of the UK signing a trade deal before it leaves the EU.
The UK would only face a procedure similar to Ceta, he said, if it failed to conclude a trade agreement before the end of two years of divorce negotiations under the EU’s article 50.
“That sort of procedure would only be undertaken were we to leave the European Union after our article 50 period without any agreement whatsoever and were looking to seek a new FTA [free-trade agreement] from outside,” he said.
Some observers think that is a likely prospect, as the article 50 divorce talks are dedicated to unwinding Britain’s EU membership and European leaders will not sign a trade deal before agreeing the divorce settlement.
Fox, a prominent leave campaigner, said the experience of Ceta might cause some to think twice before seeking a trade agreement with the EU. “Those who put politics ahead of prosperity might want to think twice,” he said.