Canada and the EU: the dawn of a new Western Order

GA Monitoring

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After 8 years of negotiations and 18 discussions held in 2016 alone, on February 15 the European Parliament ratified the EU-Canada Comprehensive Economic and Trade Agreement (CETA).

The first of a new generation of European trade agreements, dubbed by the Canadian Prime Minister as a blueprint for international trade of the future, is an achievement in itself: compared to ‘traditional’ Free Trade Agreements, it is more of an instrument that allows for political relations and influence to go alongside close trade links. It includes chapters on labour, including collective bargaining, environment, intellectual property, public procurement and much more, all of which are binding and legally enforceable.

The agreement contains a mechanism that allow the parties to review these provisions, notably on enforcement, with the EU planning on activating it as soon as CETA is provisionally applied. The review also consists of debates on sustainable development provisions involving stakeholders from multiple sectors.

Supporters highlight the potential for businesses to save €500 million a year, to protect more than 140 of the most traded European geographical indications, and open up markets in services and public procurement on all levels. Opponents, however, expressed fears of induced privatisation of public services, the loss of sovereignty to multinationals over individual countries, and a negligible gain in jobs.

Nevertheless, the importance of CETA’s ratification lies elsewhere: namely in a shifting of those who are to be considered the ‘leaders of the free world’. Given the ambiguous-at-best attitude of the new US Administration under President Donald Trump towards the international order, there are many who believe that it is the EU who remains the flag bearer for liberal democracy and international openness in the world, despite its own internal struggles with ‘illeberal’ forces.

Despite the harsh contrast between European opposition and supporters for CETA and its American counterpart the Transatlantic Trade and Investment Partnership (TTIP), they are united on almost identical positions when it comes to President Trump. The view is that the world based on openness, international cooperation, freedom to trade, multilateralism, consensus and respect for international law are now under threat from political forces across the globe, including the White House.

As the pro-EU forces would put it, the EU must consider its role in a wider international political climate by looking at the election of President Donald Trump, Brexit, and the rise of populist and protectionist parties across Europe, since it is clear that the merits of free trade, multilateralism and the liberal international world order are being questioned by many. According to them, if Trump builds walls, then Europeans must build bridges, in the form of CETA.

They also note that those who oppose these principles are often the ones who also question the foundation and the future of the EU itself, connecting the two dimensions. Many in Brussels, and not only, see this as a unique chance for the European Union to again take a leading position in the global economy and global politics.

There is an analogy to the current situation: the early 2000s. The EU’s influence and reputation in the world was always dependent on how the world assessed the US. During the time of George W. Bush, the US suffered a similar blow in international respectability and trust as it has with President Trump so far. Coincidentally, it was also the time when the EU’s reputation and pull was the highest, so much so that talks of a ‘new superpower’ began.

Internally, the EU was in a similar unstable situation as it is today: after years of careful negotiations and drafting, the Constitution for Europe was rejected by referendum in two founding Member States – France and the Netherlands – always due to fears of mass immigration from the impending Eastern Enlargement. EU leaders then cobbled up the current Lisbon Treaty, which was rejected again by the Irish, only to be approved in a second referendum.

It may very well be that especially when it comes to development aid, free trade, and the fight against climate change, Europe is being placed in the spotlight yet again, with new partnerships forming world-wide in the wake of American protectionism. On environment, we may see a future EU-China effort; President Trump’s attitude towards NATO and the North America Free Trade Agreement (NAFTA) will bring Canada even closer to the European Union on both defence and commercial policy; there are signs of political and trade relations with Mexico and Latin America being revitalised, since the EU can prove to be a more reliable ally in the face of US attempts to undermine NAFTA and Mercosur.

On why Canada may be an important indication of this shift: firstly, it is a country that currently shares more with the EU than it does with the US, since in terms of geopolitics it shares the same values as Europe, while the EU sees Canada as a nation that is closest to a European Member State than any other. Canada has a similar level of GDP, it is a NATO member and has similar and shared interests.

Canada and EU are already cooperating on a number of policy areas: the Europol Agreement, active since 2005, provides a vehicle for sharing data and information in the fight against international crime and terrorism; Canada also sends consistent military contributions to the Common Security and Defence Policy of the EU; parliamentarians from both sides jointly participate in observation missions with OCSE and NATO parliamentary assemblies. Furthermore, a Visa Liberalisation Agreement has also been recently completed and extended to the entire European Union; a Passenger Name Record agreement may come into force, pending a decision by the European Court of Justice; a Joint Ministerial Council and  Joint Consultative Council were recently created, allowing policymakers from both sides to work together on issues such as the melting ice sheets in the Canadian High North or increased migration pressures from Sub-Saharan Africa; President Trump’s repeated threats to pull the US out of the Paris Climate Change Agreement brings an additional threat to global stability, one that Canada and the EU want to face together.

Perhaps of even greater significance from this point of view is the parallel ratification of a Strategic Partnership Agreement (SPA) between the EU and Canada, which went largely unnoticed in the shadow of CETA. This deals with issues such as preventing nuclear proliferation; ensuring the effective working of the International Criminal Court, which is increasingly challenged; strengthening counterterrorism efforts and combating the financing of international terrorism; enforcing consumer protection; fighting the trade in illicit drugs; tackling cybercrime; and discussing the High North Arctic Strategy, increasingly threatened by an expansionist Russia.

Most of these issues do not apply to the US, making Canada and the EU the most viable partners for the Western World, particularly in dealing with emerging powers to the East.

When addressing the European Parliament in Strasbourg following the ratification, Prime Minister Justin Trudeau hinted at this scenario, describing the EU as a ‘truly remarkable achievement and an unprecedented model for peaceful cooperation’. According to him, Canada knows that an effective European voice on the global stage is not just preferable, but essential.

As the world’s largest donor of development and humanitarian assistance, as well as the world’s largest economy, the EU is seen by the Canadian Prime Minister as ‘a vital flare for addressing the challenges that the international community collectively faces’. For him, ‘the whole world benefits from a strong EU’. Whether national governments in the EU realise this and decide to give the EU the necessary instruments to perform this role, remains to be seen, particularly after the Dutch, French and German 2017 elections.