Lessons to be learned from the CETA debacle

By: Jude Kirton-Darling
Date: 28 October 2016

CETA – the trade and investment deal between the EU and Canada – was due to be signed yesterday at a Summit between EU leaders and Canada’s PM Justin Trudeau. But the summit was called off the night before as it become clear that the EU would not be able to sign the agreement. Wallonia and Brussels, two of Belgium’s three constitutive states, had refused to give the federal government the power to sign the agreement unless certain guarantees could be secured on investment protection and the notorious ISDS system, public services and food safety.

Yesterday morning after several days of intense negotiations, a deal has emerged between Belgium’s regions and the European Commission. It is likely that Prime Minister Trudeau will be boarding his jet to come and sign the deal in the near future. In the coming days, we will all have the chance to analyse the deal in detail and see if the concerns raised have been adequately addressed. So for now I will focus only on what lessons can we learn from this last minute crisis?

First, it should be encouraged and accepted that in parliamentary democracies it is absolutely crucial that elected representatives of the people exercise their prerogatives. Sadly, we are getting used to the government neglecting parliament in the UK. What Wallonia demonstrates is that it’s not the case everywhere, and we should take comfort in knowing that whatever comes out of this process will be democratically legitimised. In the UK, especially in the light of Brexit, we urgently need effective means for parliamentary scrutiny of our trade and investment policy, negotiations and agreements.

Once CETA is signed the deal will be submitted to the approval of the EU Parliament. Many MEPs have expressed concerns on this deal over the last few years, and we will have to see whether the negotiations with Belgium have addressed them. If the European Parliament agrees, then part of the deal will be provisionally implemented – in all likelihood, all of it except the investment protection chapter. The investment chapter will only come into force once all 35 national and regional parliaments concerned have ratified the deal.

This process is long and cumbersome. There is always a tension between efficiency and legitimacy in all democracies, and while it could be argued that the EU process is not the most efficient – it can take over 10 years between the start of a trade negotiations and the ratification of the final deal – it is legitimate.

Could we think of ways to make it more efficient while retaining proper parliamentary scrutiny? Some have suggested that the EU should now concentrate on negotiating narrow deals, focused on its exclusive competences: in short, tariffs and quotas. For such deals, the consultation of national parliaments would not be necessary, and only a qualified majority of member states would be required – rather than unanimity – to sign them. This would mean however that the EU would have to stop getting involved in the reregulation of globalisation. Establishing strong global standards to protect consumers and workers will mean that we have to get our hands dirty in negotiating rules. Inevitably this means talking about regulation which is the responsibility of national, regional and local governments. It would be wrong for these decisions to be taken without greater democratic scrutiny at sub-European level. We don’t need a reduction in democratic scrutiny, public mistrust of trade policy demands greater democratic participation. Now we have to work out, how do this efficiently.

The European Parliament can help in this respect. By monitoring all trade deals we are already actively involving social partners and civil society organisation in broad and thorough consultations. We could do the same with national parliaments, early on the process, so that the debate can progress at the same pace in Brussels and in all national capitals. Ensuring that democratically elected representative are involved in setting mandates for negotiators, following negotiations and ratifying agreements will create legitimacy.

Rather than repatriating European debate in all EU member states, this would help creating a truly European public space and allow democratic debate about the type of trade policy and agreements we want and need.