Now more than ever, global trade relationships are important
Sigmar Gabriel, the Vice-Chancellor of Germany, has recently claimed that the controversial Trans-Atlantic Trade and Investment Partnership (TTIP) free trade deal between the European Union (EU) and the United States has failed. As TTIP’s future is faltering, the future of Comprehensive Economic and Trade Agreement (CETA) free trade deal between Canada and the EU is also looking doubtful.
In response, a group of German non-governmental organizations have launched the largest-ever German civil lawsuit seeking to block CETA. At the same time the European Commission has decided that the deal must be individually ratified by every single national parliament, as some European governments are becoming more and more reluctant to back CETA.
Since the EU is Canada’s second-largest trading partner and second-largest source of foreign direct investment, it is very important that Canada move to break down barriers between us and Europe. CETA could accomplish this very thing by abolishing the vast majority of trade barriers between Canada and the EU. and making it much easier to trade services.
These barriers hit small businesses the hardest, meaning that those businesses will benefit the most if CETA succeeds. CETA will also allow more European goods to be sold in Canada, giving consumers access to a greater variety of products.
Free trade is often accused of undermining labour rights and environmental protections, but CETA explicitly guarantees that Canada and the EU can keep high standards in both those areas.
CETA is also often accused of undermining national sovereignty. However this line of thinking fails to recognize that people should matter more than governments. Think of the North American Free Trade Agreement (NAFTA), which was itself very controversial in the early 90s. By and large, almost none of the claimed problems happened in any significant way. Instead, it’s had a very positive effect on our economy, helping to effectively double the combined gross domestic product of Canada, the U.S., and Mexico since 1993.
There is also European stability to think about. After Brexit, and with the French and German elections in 2017, the failure of CETA would just add fuel to the Eurosceptic fire which risks severely undermining one of Canada’s key international allies.
CETA could also help Canadian unity. Our free trade deals with the rest of the world could set a good example for finally breaking down trade barriers between our own provinces.
In Canada, we are extremely lucky to have a solid political consensus in favour of being open to the world. But it looks like our international allies do not have such a solid consensus. In the U.S., both Bernie Sanders and Donald Trump have declared themselves against NAFTA. In the U.K., both Nigel Farage and Jeremy Corbyn are against TTIP.
Especially as CETA is so close to ratification after almost a decade of negotiation and review, we should act quickly on free trade while we still can.
It looks like the great political divide of our age is not left vs. right, or capitalism vs. communism. Instead, it’s all about pro-globalisation vs. anti-globalisation, especially since the big political debates today are the refugee crisis, free trade deals, immigration, international institutions, and the like.
As we move forward further into the 21st century, we should be open, modern, and engaging with the world, and trade deals like CETA are a great way to achieve this.
We should be tearing down the walls that stand between us, not building them up.