Is CETA A Sign Of Diversified Canadian Economic Dependence?

World

On Wednesday February 15th, the European Parliament in Strasbourg voted to ratify the Comprehensive Economic and Trade Agreement (CETA). The deal moves to create a free trade zone between Canada and the European Union, eliminating trade tariffs, allowing foreign corporations to compete for contracts in member states, and in the long term moves to unify labour and environmental standards on both sides of the Atlantic.

The deal has been celebrated in both Canada and Europe, with Canadian International Trade Minister Francois-Phillippe Champagne emphasizing the improvements for consumers calling CETA a “deal for the people.” Speaking in Strasbourg Wednesday morning MEP Artis Pabriks, the Latvian spokesman for CETA, said, “By adopting CETA, we chose openness, and growth and high standards over protectionism and stagnation.” (via CBC)

Although the European Parliament passed the deal with 58% of the vote, there has been a vocal criticism of the deal throughout Europe that seems unlikely to abate anytime soon. Most critics have concerns over the investor-state dispute settlement aspect of the agreement, which would allow corporations to sue governments over policies which would jeopardize their profits in future. This has also lead to concerns that the deal will call food safety standards into question and threaten the sovereignty of states to make trade laws which contradict those outlined in CETA. On the European end of the deal, there is also concern that it will provide a backdoor for U.S. Corporations to enter the Eurozone tax-free, as the deal extends to American companies with offices in Canada.

EU Commissioner of Trade Cecelia Malmstrom has brushed off these concerns, saying that approving the deal “will not change food safety standards or any other EU requirements, only the EU institutions can do that.” Provided she’s right, there does seem to be the potential for the agreement to strengthen both European and Canadian economies. Currently, €60 billion ($64 billion) worth of trade flows between Canada and Europe annually, and the agreement is set to increase that number by 20% in its first year.

While the economic ramifications of the deal are significant, the shift in foreign relations between Canada and the United States is making waves.

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