A free trade agreement between the European Union and Canada, called the comprehensive Economic and Trade Agreement (CETA) has been negotiated and will be transferred to EU member-states soon for approval, writes Prince Michael of Liechtenstein.
The agreement is seen as a test case for the Transatlantic Trade and Investment Partnership (TTIP) between the US and the EU which includes Canada, Mexico and European Economic Area countries of Norway, Iceland and Liechtenstein.
The TTIP will, as with all free trade agreements, boost trade and should benefit Europe with extra economic growth of 120 billion euros a year, the US with 90 billion and the rest of the world with 100 billion, according to EU sources. This is an important project.
The TTIP and CETA see a large raft of tariffs and non-tariff trade barriers created through differing regulations largely eliminated. They also include new clauses to protect investments. It is envisaged that this protection can be enforced, or indemnities for damages set, by international arbitration instead of national courts.
The TTIP is challenged by widely diverse groups which consumers mainly fear will face a reduction in standards. There is also concern in Europe about genetically modified products. Certain business lobbies are also against it because they are taking a short-sighted view to protect their markets.
The fear factor overlays a profound discussion. But it can also be said that the benefits of the treaty have not been argued sufficiently by the EU and the US. Two new developments in the ‘pro and cons’ have emerged while the sixth round of negotiations are taking place. It appears the German government may not approve the CETA agreement, according to German newspapers. Germany, it seems, does not want to accept international arbitration for investment protection. But this is an important part of the treaties.
A non-acceptance by Europe’s largest economy would be a blow as the CETA is seen as a test case for the TTIP. It poses a danger that the treaty will be delayed or watered down.
A Dutch MEP, Sophie in 't Veld, challenged the so-called SWIFT agreement between the EU and the US in the European Court of Justice in 2009. This allows for the transfer of financial data. This legal case, which has no connection with the TTIP, saw the European Court comment on transparency in a ruling on July 3, 2014. Applying these comments could lead to the public being given greater transparency about the TTIP negotiations. This also corresponds to past requests by German politician Martin Schulz, the President of the European Parliament.
Both the potential German refusal of the CETA and the European Court’s comments are seen as a success by those opposing the TTIP. The refusal of the CETA by Germany would be really damaging, but more transparency in the negotiations can be seen as an opportunity to explain the advantages of the TTIP better and to reduce fear. A perceived lack of transparency in EU procedures is a real problem.
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