Farm Ireland

Sunday 23 October 2016

Brussels briefing: Commission forced to stall Canadian trade agreement

Sarah Collins

Published 13/07/2016 | 02:30

European Union trade chief Cecilia Malmström
European Union trade chief Cecilia Malmström

The European Commission has been forced to put the brakes on a deal with Canada, sending it back to EU governments for approval - against its own legal advice.

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The 30-chapter deal, known as the Comprehensive Economic and Trade Agreement, is the most-wide ranging trade deal every concluded by the EU, taking more than seven years.

It will set a precedent for a future EU-US trade agreement and any post-Brexit deal with the UK.

Opposition to free trade agreements has been growing, particularly in Austria, France, Germany and Belgium, while Romania and Bulgaria have threatened to torpedo the deal unless Canada grants its citizens visa-free travel.

EU trade chief Cecilia Malmström last week accused governments of "not showing the adequate leadership" in steering the deal through.

"The risk to ending EU trade policy as we know it is that member states infect this debate by confusing the content of the agreement with a general malaise and anti-globalisation feelings in their countries," she said.

The Irish government sees the deal as a good one for the country, as it eliminates 99pc of customs duties and opens up lucrative public procurement and agri-food markets for Irish goods.

But the Irish Congress of Trades Unions says the deal will lead to the privatisation of public services and the dismantling of workers rights, health and safety and environmental standards.

Irish MEP Marian Harkin welcomed what she called the Commission's "u-turn" on the process.

"Yes it will take time and yes democracy can be messy but European citizens need to know their views count," the Independent MEP said after the Commission's decision.

French trade minister Matthias Fekl said that while the deal is good for France - it will allow market access for more than 40 French cheeses, meats and wines - it is crucial that parliaments have "the last word". "It's a matter of principle to ensure European citizens support the trade policies that are carried out in their name."

However, the European Commission wants to sign it at a summit with Canada in October and says it could apply 'provisionally' from that date, even if parliaments have not yet approved it.

Sinn Féin MEP Matt Carthy said that would "make a mockery of the process and would create a further chasm between the EU institutions and the citizens of Europe" and has called on the Irish government to block the move when it comes before EU trade ministers this month.

The Commission is also waiting for the outcome of a court case on a trade deal with Singapore, which it hopes will clear up future legal questions. The court is expected to rule next spring.

EU officials frustrated by US 'intransigence'

The Canadian trade deal saga does not bode well for the EU's ongoing negotiations with the US on the transatlantic trade and investment partnership (TTIP).

Negotiators meet this week for a 14th round of talks but progress has not advanced at a rapid enough pace for a deal to be concluded before the US elections in November.

There will be up to eight new texts on the table for agreement this round, in areas including energy and digital services.

However, not one text out of a total of up to 30 has yet been fully signed off by either side, and they haven't yet even begun to discuss agricultural tariffs - this will be kept until talks reach the 'end game'.

EU officials have accused the US of being intransigent on issues such as public procurement (they say they can't open up state-level procurement contracts to EU companies as it would contravene a 'Buy American' clause), but the EU side is equally protective of its interests. Take the 1,600-page Canada trade deal, which was published last week: it contains more than 500 pages of exemptions for EU industry and services.

Ireland has five reservations in the areas of agriculture, mining, legal services, veterinary services and fisheries.

The impasse between the two sides is made worse by popular opposition to TTIP, which has grown especially in countries such as France, Austria and Germany.

A petition launched by an alliance of NGOs and left-leaning politicians against both TTIP and CETA has garnered almost 3.5 million signatures.

It is symptomatic of the rift that has opened up in Europe on issues like glyphosate and GMOs, where EU governments with looming general elections or referendums have become more sympathetic to protest movements.

Given the complexity of the EU-US trade deal, the slow pace of negotiations and popular opposition, it is likely to take a number of years to conclude.

Grain prices on the slide

Grain prices have dropped in recent days on the back of a strong carryover of global stocks and amid few signs of weather turbulence, writes Louise Hogan.

The fallout from Brexit has added to the negative price trends. Latest grain production estimates from the EU show a marginal fall of 4 million tonnes in production.

However, a number of buyers in the French marketplace have described the winter barley crop as a disaster with both yield and quality hit by wet weather.

New crop price offers for dried barley on the Irish market are ranging from €146/t to €151/t with €157/t to €159/t on offer for wheat.

The IFA president Joe Healy called for the EU Commission and Government to act to address the deepening income prices from falling grain prices. He warned the sector had declined by 40,000ha over the last four years.

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