Many people in Europe, and some in the UK, will breathe a sigh of relief that the proposed Canada-Europe Comprehensive and Trade Agreement (CETA) has effectively been vetoed by Belgium. The BBC has reported the veto, in an irresponsible and lazy caricature, as being about meat: “Walloon MPs say Ceta favours Canadian firms and they want more safeguards for Belgian farmers.” Recent demonstrations in Poland admittedly made a big deal of the effect on meat, but the objections which were discussed in Wallonia run much deeper. Their concerns have have been reported as relating to the protection of investments, workers’ rights, public services and tendering for public contracts. CETA (known as AECG in French) was intended to “end restrictions on access to public contracts” and “open-up the services market”. There are particular concerns about health care. Public services would have been required to compete with commercial funds and liable to be sued by individual firms and forced to pay compensation if governments resist on the basis of public health. The agreement comes with the principle of a ‘valve’, or lobster pot, as other trade agreements: once something has been marketised, it can never be decommodified again. These are the same terms that have caused such concern about TTIP, the US’s proposals for transatlantic trade, and there have been protests in several European countries against the proposals. Some of the same objections have been voiced in Canada.
The Belgian decision is being extrapolated to the prospect for the UK’s negotiation of future trade agreements with the EU. The cases are not equivalent, in three ways. First, the Article 50 process is not subject to veto by a single country, but to qualified majority voting. Second, the UK currently meets the demands of the acquis communautaire, as no country in NAFTA does. The UK can comply directly and fully with European regulations, because it already does so.
Third, Canada is a member of NAFTA, the North American Free Trade Agreement. The terms of CETA would have effectively have fused the European Single Market with the terms of NAFTA by removing all barriers to American trade and services, which could then flow freely through Canada to Europe. The UK is not a member of NAFTA, and does not trade without restriction in American, Canadian and Mexican goods and services. If it did, or in its desperation to find trade partners it agreed terms with NAFTA that are as bad as those proposed for CETA or TTIP, then any agreement with between the UK and the EU would permit goods and services to flow on the same terms from NAFTA as from the UK. This would have to be subject to the same reservations as those applied to Canada.
Further note, 30th October. Belgium’s objection has been withdrawn and the agreement is being signed. Governments within the EU do have the capacity to make reservations about goods and services imported from third countries, but for all practical purposes the agreement amounts to a customs union with NAFTA.
Public services are not much mentioned. The key reservations are in Annex II: there are derogations for pharmacy (p 1298), health services (pp 1305-08) which in most cases must be provided by people physically in the country) and some social services (p 1308), though the United Kingdom has beyond that permitted some exceptions for residential care (pp 1450-52).