It's deja vu: EU and Canada will hail end to trade talks, again

Thu Sep 25, 2014 6:01pm EDT
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By Robin Emmott and David Ljunggren

BRUSSELS/OTTAWA (Reuters) - Germany's rejection of part of a multibillion-dollar trade deal between the European Union and Canada threatens to derail the agreement, in a potentially embarrassing re-run of a breakdown a year ago.

On Friday, Canadian Prime Minister Stephen Harper and European Commission President Jose Manuel Barroso are due to announce in Ottawa the end of five years of negotiations on the trade accord, with the finalization of a 1,500-page text that its architects say should increase two-way trade by a fifth, to 26 billion euros ($33 billion) a year.

But what was supposed to be a straightforward signing ceremony now risks becoming another embarrassment for both sides, in difficult negotiations that began in May 2009 and are widely seen as a blueprint for a much bigger deal being negotiated between the European Union and United States.

Last October, Harper and Barroso said over a celebratory lunch that the pact was sealed and it was "a landmark achievement for the transatlantic market". Then problems on difficult issues such as pharmaceutical patents to emerge.

This time, both Germany and the European Parliament, which must ratify the treaty for it to take effect, are raising objections to part of the agreement that allows companies to bring claims against a state if it breaches the trade treaty.

It is a mechanism that Berlin also wants removed from the deal the EU is negotiating with Washington.

Failure to agree a deal with Ottawa would bode poorly for the EU's chances of a more ambitious accord with the United States that would encompass almost half the global economy.

Germany shares the concerns of EU lawmakers and consumer and environmental groups across Europe who say the mechanism would allow multinationals to bully the EU's 28 governments into doing their bidding, disregarding environmental, labor and food laws.   Continued...