It was all going so well for the CETA (The Comprehensive Economic and Trade Agreement) process between Canada and the EU. Brussels and Ottawa have spend seven years negotiating the finer points of the deal which would see tariffs stripped back on many goods between Canada and the EU, for it all to go pear shaped down to one region of Belgium. It seems strange that one small region can cause such damage, but when you consider what the EU is it is not surprising. What is more surprising is in fact that this has not happened sooner.
Wallonia, CETA and European Trade Policy
European Union rules give the European Union the power to negotiate trade deals on behalf all the member states. The only input from Member States is the signing off on the deal at the end. This process has to be unanimous between member states, so if one member states vetoes the decision then the entire process is in trouble.
Trade agreements cannot be thrashed out overnight but take years and years to agree. CETA itself has taken seven years to get to this point and it still is not even signed yet. TTIP has taken quite a while as have prospective deals with Asia. However, the European Union, or specifically the European Commission is acutely aware of the need to unanimous consent so seeks to involve member states in the process. The final text for CETA was published in April 2014 for all member states to look over and raise objections and indeed they did just this. The Czechs among others wanted changes to the agreement which would see Czech citizens win the right to visa free travel to Canada.
The deal itself was/is due to be signed on Thursday 27th October with Canadian Prime Minister Justin Trudeau coming to Brussels to sign the agreement. The last piece of the deal is the unanimous consent of the member states, which allows Juncker and Tusk to sign on behalf of the EU. Typically this would be a straight forward process, Member States would in which ever legal way their nation states would consult and then decide on whether or not to support the deal.
It is in this detail that Wallonia comes into play. Belgium is a federal country with each of the regions having parliaments of their own. The socialist led Wallonian Parliament has rejected the deal. As Belgium operates on the basis of unanimous consent this has meant that Belgium now can no longer sign the deal, and thus the EU cannot proceed with the deal.
What does this mean for the future?
CETA has taken seven years to get to this stage, and a comprehensive trade deal between the UK and EU would take roughly this amount of time too. Meaning that the deal would not be concluded until 2026 if the UK Government were to pursue such a deal. However, as CETA has proven, there is no guarantee that this will succeed. It only needs Wallonia or another region of Belgium or another not so sympathetic Member State to pour cold water on the deal. This author can certainly think of a few member states who would relish the opportunity to do just that! Can you?
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