After a bit of a setback from Belgium, the European Union and Canada have signed a free trade agreement that will eliminate nearly all duties and possibly pave the way for the Transatlantic Trade and Investment Partnership (TTIP) with the United States.
CETA will eliminate almost 99 percent of tariffs on goods, which is expected to benefit the EU textile sector as current Canadian duties can be as high as 18 percent.
“The signing of CETA is a historic occasion,” Canadian prime minster Justin Trudeau said in a statement. “This modern and progressive agreement will reinforce the strong links between Canada and the EU, and create vast new opportunities for Canadians and Europeans alike—opening new markets for our exporters, offering more choices and better prices to consumers, and forging stronger ties between our economies.”
CETA was nearly the deal that wasn’t when Belgium used its veto because its French-speaking Wallonia region had hang-ups about certain inclusions, and the deal must have the support of all 28 EU nations to move forward. On Friday, however, Belgium withdrew its veto after its government made some concessions, like protections for farmers, which was of concern.
Some were concerned that a failed CETA would be problematic for the EU and trade at a time when the region is trying to regain stability after Brexit threw things off balance.
Now it seems CETA could be a precursor to finalizing TTIP with the U.S.—though at this stage, little will likely happen on the U.S. side until the new president takes office next year.
“Now that we see the Canadian deal has made it over the finish line, the Atlantic trade deal still has a fighting change,” Jacob Funk Kirkegaard, senior fellow at the Peterson Institute for International Economics, told The New York Times. “But it won’t be easy. TTIP could similarly threaten traditional farming interests and arouse knee-jerk European suspicions about common trans-Atlantic health and environmental standards.”