Lessons to be learnt from CETA’s stalemate

Those who believed this spring that CETA was a done deal now have quite a few things on their hands. The complexity of the EU decision-making and the diverging political interests within it have once again taken the bureaucrats in charge of negotiating the deal by surprise.

This occurrence is a case in point of why one needs to make much broader political calculations when trying to get something approved by the EU decision-making machinery. Having the EP rapporteur and some big governments on board no longer guarantees that there is enough political support to get things done. One has to pay attention to the views and agendas of many other political forces across the continent, as the (opposition) fire can ignite in any of the regions where political support is more volatile, should more elements converge.

While the proponents of this trade deal were busy negotiating its details and planning its signature, the opponents of CETA have conducted an aggressive public communication campaign in several EU countries, which included demonstrations and social media activism. The influence exerted by this campaign on the public opinion seems to have been just enough to offer some politicians an opportunity to capitalise on putting the stick in the wheels of CETA.

How one small region could sink the EU-Canada trade deal

The regional parliaments of the Federation Wallonie-Bruxelles and the Walloon region in Belgium rejected the agreement, meaning the Belgian Federal government cannot ratify the deal. Without a Belgian signature, CETA cannot enter into force.

The majority in both Walloon governments is formed by the Socialist Party (the Social Democrat party of former Prime Minister Elio Di Rupo) and the Humanist Democratic Center (CDH), their junior Christian Democrat coalition partner. Immediately, there was a lot of consternation. Both parties are part of the main centrist groups in the European Parliament, the PS being a member of the Socialists & Democrats (S&D) and the CDH of the European People’s Party (EPP). Both political groups, as a whole, back the trade deal. For this reason, little attention was paid to the Walloons. However, if one had paid attention, one would have noticed that these Walloon MEPs have had for a long time a more critical position and expressed reservations about trade deals such as TTIP and CETA. In other words, the fuel was there, it just needed an opportunity to catch fire.

Related analysis: Who is for and agaisnt trade in the European Parliament?

Understanding Belgian politics sheds light on the current developments

The situation makes more sense when you look at internal Belgian politics. Over the years, often due to demands of Flemish (-nationalist) politicians, international trade policy has become a regional competence in Belgium. Normally, this doesn’t cause any problems at the EU-level, as the European Commission doesn’t need final approval from national parliaments to close a trade deal – a mandate from the ministers in the Council is enough. This time however, Commission President Juncker wanted to avoid an “undemocratic” deal – especially with all the uproar surrounding the (still under negotiation) TTIP trade deal with the US – so he put the deal up for approval by national parliaments.[1]

However, Juncker’s demarche meant that in Belgium no less than 5 regional parliaments had to ratify it. At first sight, this should have gone smoothly, but clearly some key details have been lost sight of.

The Perfect Storm

So is it really “evolving insight”, as Paul Magnette (PS), minister-president of the Walloon region, described the PS’ switch, over time, from support to opposition of CETA? That seems hardly the case: CETA would mainly impact Flemish trade rather than the Wallonian one, said experts. There seem to be no specific grievances put forward by Magnette, who cites potential damages to the Belgian economy as his reason for opposing. [2] Moreover, the federal and Flemish governments, are heavily in favour of the deal. PS and CDH are in the opposition on the federal level, so the opposition to CETA was quickly characterized by Flemish commentators as an opportunistic direct attack on the Francophone Liberal Reformist Movement (MR) of prime minister Charles Michel and the Flemish Nationalist New-Flemish Alliance (N-VA) of the Flemish minister-president Geert Bourgeois. Additionally, recent opinion polls showed the PS hemorrhaging support in Wallonia to the hard-left Belgian Workers Party (PTB).[3]

In other words: a perfect storm. By positioning itself as anti-CETA, PS and CDH get to reap the domestic benefits by showing their (hard-)left credentials to a domestic audience in Wallonia and progressive organizations worldwide who oppose the deal, such as Greenpeace. On top of that, they present the Flemish-Nationalists of N-VA with the consequences of their call for the devolvement of more powers to the regions. While N-VA is strongly in favor of CETA, it cannot move too harshly against Wallonia in fear of contradicting their strong belief in regional self-determination.

Pressure remains high on the Walloons, with former EU Trade Commissioner Karel De Gucht stating Wallonia should go to the Constitutional Court over the question and calling on the federal government “to sign the deal anyway”. De Gucht is part of the Flemish Liberals, who are in the ruling coalition on the federal level. Magnette stated that the Walloons are merely “exercising their democratic rights” and that there is still room for negotiation.[4] Both representatives of the Canadian government and the French president François Hollande, normally a close ally of Magnette, have urged the minister-president to give the go ahead. [5] Belgian Foreign Minister Didier Reynders (MR) quipped that “There are 27,5 countries in favor of the deal”, saying that a lot of his colleagues did not understand the Wallonian stance after a lot of guarantees had already been given. However, Wallonia has its sovereign right to have a say on this and is keen to use it.

The Double-edged Sword

Tuesday evening late, the Walloon Parliament convened in an urgent session. The cabinet of Cecilia Malmström, the European commissioner for Trade gave “new guarantees” during the day that would enable Magnette & co to drop their opposition, including further promises to safeguard rights of workers. However, Magnette sticked to his guns, stating “there are too many problems” to fix them in time for the EU summit on Thursday and Friday. He asked to delay the ratification procedure.[6]

Juncker’s gamble has turned out to be a double edged sword: by making the process of ratification of a trade deal more democratic, he has opened the floor to concerns from various regional parliaments and assemblies. Importantly, this is unlikely to be the only time when this path is followed, as more trade agreements are under way and the Commission finds itself between a rock (the need to come up with deals that would help stimulate the stagnating economy) and a hard place (the need to avoid stirring up more nationalist tendencies in various regions). Walloonia has set out a precedent, which will encourage others to do the same in the future. We should therefore be prepared to carefully observe the concerns expressed “on the ground” and the positions of the MEPs to predict the socio-political developments all across the EU.

Related analyses:

TTIP under pressure, what are the forecassts?

The influence of EP rapporteurs on international trade dossiers is over-estimated

About the authors:

Korneel De Schamp is an independent Belgian political researcher, graduate of College of Europe and KU Leuven.

Doru Peter Frantescu is cofounder and director of VoteWatch Europe, the think tank most followed by the Members of the European Parliament in 2016. He provides regular commentaries on EU politics to international media.

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[1] http://www.standaard.be/cnt/dmf20161014_02520725

[2] http://www.standaard.be/cnt/dmf20161014_02519461

[3] http://www.standaard.be/cnt/dmf20161014_02519079

[4] http://www.standaard.be/cnt/dmf20161014_02520449 / http://www.standaard.be/cnt/dmf20161014_02520725

[5] http://www.lalibre.be/actu/politique-belge/ceta-caterpillar-paul-magnette-s-entretient-avec-francois-hollande-a-paris-5801153fcd701eed8fcd238a

[6] http://www.hln.be/hln/nl/942/Economie/article/detail/2930250/2016/10/18/Belgie-krijgt-nog-drie-dagen-voor-akkoord-over-CETA.dhtml http://www.tijd.be/politiek_economie/europa_economie/Wallonie_blijft_bij_verzet_handelsverdrag_Canada.9821077-3149.art

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