CETA: Will Berlin nix the Canada-EU trade deal?

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CETA: Will Berlin nix the Canada-EU trade deal?

[ http://www.dw.de/will-berlin-nix-the-ca ... a-17893804 ]

Deutsche Welle September 2, 2014 by Michael Knigge

Later this month, the EU and Canada will ink a trade deal that is seen as a template for a similar pact between the EU and the US. While Germany has criticized parts of deal, the biggest threat doesn't come from Berlin.

When Canadian and European leaders gather at the end of September in Ottawa to sign off on the Comprehensive Economic and Trade Agreement (CETA), it will be evident why the agreement is important for Canadian businesses. After all, the deal opens their doors to the world's biggest market, the EU, which until now has been underrepresented in Canada's international business relations, which are heavily focused on its southern neighbor, the US.

For the EU however, the Canada trade pact is important for a very different reason. Sure, Canada's vast energy and natural resources are attractive for Europe, particularly given Europe's dependence on an increasingly hostile Russia. And European companies will also appreciate easier access to the Canadian market, which is roughly the size of Poland's. But for the EU, the Canada deal is just an appetizer.

Washington watches

"It creates a template that could be used, not word for word, but broadly speaking, for the negotiations with the United States, amongst others," said Jason Langrish, executive director of the Canada Europe Roundtable for Business, a lobby group that supports CETA, in an interview with DW. "That's the principle benefit for Europe."

Washington, while simultaneously negotiating its own trade deal with Brussels - the world's biggest - has been paying close attention to Canadian-European talks and is eager to see whether the EU can not only conclude an agreement, but also get it ratified by its member states and parliament.

One of the most skeptical members involved in CETA is also, economically, the EU's biggest - Germany. In particular, it's the planned inclusion of a mechanism called investor-state dispute settlement (ISDS) that has raised alarm bells in Berlin. ISDS schemes allow foreign companies to take governments before arbitration panels instead of going through the established courts.

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