Making Sense of the CETA
Canadian Centre for Policy Alternatives (CCPA)
We have entered into the age of globalization 2.0, thus countering the framework of global governance as it was thought and experienced 20 years ago. We are witnessing the rise of free trade agreements that are increasingly becoming the references in issues of international trade, at the expense of the WTO, which, now more than ever, is in a moribund state.
Yet the global impression is such that, beyond the lack of openness and communication regarding these various agreements, the real benefits to be gained by protagonists––especially agricultural protagonists––seem clearly unbalanced, all the more so if one looks at his own turf. This is the case of the free-trade agreement between the EU and Canada (CETA or AECG in French), whose 42 chapters and more than 1,500 pages were leaked to the press last summer. Formally concluded on September 26, 2014, this partnership––which will actually come into effect in 2017––is far from meeting a unanimous approval by European and Canadian agricultural organizations. We highly recommend this excerpt from a report of the Canadian Centre for Policy Alternatives (CCPA)1, which provides an in-depth analysis of the text of the agreement. CCPA’s experts are thus pointing out that this is more than a regular trade agreement. This agreement covers investments, intellectual property, as well as employment, agriculture and food security. Which are its concrete repercussions on European and Canadian human and economic activities? One thing is certain, these experts feel that this partnership is all but balanced, and will be implemented to the detriment of public interest.
Lastly, there are increasingly more people to demand “smart” globalization, to feel that free market conditions are not the ultimate panacea to future exogenous or endogenous crises. Are we really ready to conclude an agreement whose economic consequences would be both damaging and irreversible to a strategic sector such as agriculture?
momagri Editorial Board
More than five years after the May 2009 launch of negotiations between Canada and the European Union toward a Comprehensive Economic and Trade Agreement (CETA), it was announced on August 5, 2014 that “officials have reached a complete text, allowing translation and final legal review to commence.”
Less than two weeks later, on August 13, German broadcaster ARD leaked more than 500 pages of the CETA consolidated text, followed the next day by an additional 1,000 pages of annexes. The Berlin-based digital rights group netzpolitik.org subsequently released some additional CETA texts, including tariff offers and side letters. Neither the Canadian government nor the European Commission has publicly discussed the leaked text, despite its availability on multiple websites.
While the leaked CETA text will undergo some changes during the legal review and scrubbing process, both parties have indicated that they now consider the text closed, and that no substantive changes can be made.
Canadian Prime Minister Stephen Harper, President of the European Council Herman Van Rompuy, and President of the European Commission Jose Manuel Barroso will reportedly announce the formal close of negotiations at the EU-Canada Summit on September 26, 2014.
These developments should put to rest any doubts that the leaked documents, upon which this analysis is based, are actually the official CETA text.
But they raise deeper, more troubling issues about the secrecy and democratic deficit surrounding this agreement.
Both sides have committed to sign off on the final text before any meaningful public debate can possibly take place. This take-it-or-leave-it approach leaves little room for the citizens of Canada or the EU to assess the CETA ’s potential impacts, let alone advocate for changes.
Such irrevocability would not be acceptable even if this treaty dealt solely with traditional international trade matters, such as reducing tariffs or eliminating other border restrictions. However, with few exceptions, such traditional trade barriers between Canada and the EU are already very low.
While the European Commission and the Canadian federal government may consider the CETA debate to be closed now that the text is finalized, others still insist on having their say. The final text includes a controversial investor-state dispute settlement (ISDS) mechanism (see section by Peter Fuchs) that a large bloc of parties in the European Parliament, which has a veto over the deal, has indicated it will reject.
Many of Europe’s 28 member states, which will have to individually ratify the agreement, also have serious misgivings about ISDS. Major Canadian provinces are concerned about the fiscal impacts of extended patent protection for medicines. Even if the federal government agrees to and honours a commitment to bear the brunt of any increase in health care costs from changes to Canada’s intellectual property rights regime, this simply means that taxpayers would pay at the federal rather than the provincial level. And it is all being done to boost the profits of the brand name pharmaceutical industry (see section by Scott Sinclair, Marc-André Gagnon and Joel Lexchin).
Many Canadian municipal governments remain deeply dissatisfied with restrictions in the CETA on their purchasing authority. Given the procurement chapter’s coverage of strategic sectors such as renewable energy, mass transit and local food (see sections by Stuart Trew, Angelo DiCaro and Amy Wood), it is not clear that the final text satisfies the conditions laid down by the Federation of Canadian Municipalities, which has been generally supportive of the agreement.
Finally, the influence of grassroots citizens’ movements should not be discounted. Particularly in Europe, the Transatlantic Trade and Investment
Partnership (TTIP) negotiations between the EU and the U.S. have galvanized public opposition to ISDS, further trade treaty restrictions on public interest domestic regulation (see section by Ellen Gould), and further trade treaty inroads into food security and food safety (see sections by Ann Slater and Terry Boehm, and Amy Wood).
As all the many and varied contributions to this analysis make clear, this treaty is about much more than trade. The CETA is a sweeping constitutional- style document that affects many matters only loosely related to trade, including investor rights, intellectual property protection for pharmaceuticals, government procurement, buy-local food policies, public interest and financial regulation, the temporary movement of workers, domestic regulation and public services, to name just a few of the topics explored in this analysis.
This collection represents the first, most comprehensive analysis of the completed Canada-EU CETA as exposed in recent leaks.4 It is intended to offer insight into a number of the most important and contentious elements of the agreement. Additional and more in-depth analyses on specific chapters and their potential consequences will be needed as the CETA makes its way through the ratification process in both Europe and Canada, a process which is not expected to be completed before 2016 at the earliest.
Agriculture and Food Sovereignty
Despite official claims, the CETA is unlikely to result in significant increases of beef or pork exports from Canada to Europe, since the EU is itself a major exporter of both products. The agreement will almost certainly lead to greater cheese imports from the EU, through a near-doubling of the quota for EU cheese. It is estimated that this will cost Canadian dairy farmers 4% of the domestic cheese market.
Expanded intellectual property rights for multinational seed companies will increase seed costs and undermine farmers’ autonomy.
The CETA threatens food sovereignty by increasing the likelihood that buy local food purchasing programs at the provincial and municipal level will be curtailed because they violate the agreement’s procurement obligations.
Canada could have reserved the right of hospitals, municipalities and other public bodies to adopt minimum local food requirements in publicly run institutions but failed to do so.
1 The complete report is available from: