Canadian Prime Minister Stephen Harper and top EU officials are due on Friday to celebrate a key milestone reached in their free trade negotiations, but the Ottawa summit has been overshadowed by last-minute German concerns over the deal.
A spokesman for German Minister for Economics Sigmar Gabriel in Berlin dismissed as “highly speculative” suggestions that Germany would refuse to back the 35-billion-dollar pact with Canada if existing clauses on investor protection rules were not removed.
The spokesman went on to insist that Gabriel was committed to the Comprehensive Economic and Trade Agreement (CETA) between the Brussels-based bloc and Canada.
But he said Gabriel would not accept the agreement’s investor protection clauses, which calls for disputes between companies and governments to be resolved by international arbitration panel rather than national courts.
Opponents of the deal, including Germany’s opposition hard-left Linke and the Greens, argue that dispute settlement provisions would undermine EU labour protection laws as well as threaten the environment.
Gabriel is the head of Germany’s left-leaning Social Democratic Party (SDP), which is the junior member of Chancellor Angela Merkel’s ruling coalition and has close historic links with the German trade union movement.
German trade union chief Reiner Hoffmann called on Brussels on Friday to reopen negotiations on the treaty with Canada so as to remove the controversial investor protection clause from the agreement, which is seen as a blueprint for the planned trade pact between the EU and the United States (TTIP).
However, Germany’s leading business lobby group, the Federation of German Industry (BDI) seized on the agreement as representing a major opportunity for the German economy.
“Germany is particularly dependent on open markets and high global standards,” said BDI general manager Markus Kerber, pointing to EU data predicting that the agreement would lead to a 23-per-cent gain in trade between Europe and Canada.
While the trade deal is not yet ready to be signed, EU President Herman Van Rompuy, European Commission President Jose Manuel Barroso and Harper plan to pledge their political commitment to the text, which was finalized in July.
CETA aims to strengthen trade relations and boost economic growth, by removing most remaining tariffs between Canada and the EU.
The investor-state dispute settlement (ISDS) clause has met with vocal opposition among many Europeans, over fears that it could be abused by corporations.
Harper has called the CETA an “historic” deal that goes “deeper in ambition and broader in scope than any other trade agreement in Canadian history.”
The EU hopes it will help boost its languishing economy and encourage much-needed job creation.
However, the agreement will not be initialled in Ottawa – a common step showing that the text has been finalized – and it will take many months before it can be signed.
To take effect, the CETA must be approved by parliaments on both sides of the Atlantic and by EU member states.
Also on Friday, Canada and the EU will seal a Strategic Partnership Agreement, broadening cooperation in energy, security, innovation, sustainable development and the promotion of human rights.
The talks will include developments in eastern Ukraine and the situation in Syria and Iraq, as well as counterterrorism efforts in Africa and global challenges such as climate change.
Following a joint lunch, the leaders are due to meet business representatives from both sides of the Atlantic.
Canada is the EU’s 12th most important trading partner, with EU exports reaching 31.6 billion euros (42 billion dollars) in 2013, while imports from Canada stood at 27.3 billion euros, according to the EU’s statistics office Eurostat.
GNA
