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CETA's moment of truth

Sabine Kinkartz, Berlin / groSeptember 15, 2016

Negotiations for the free trade agreement between the EU and Canada are entering the final stage. The political stakes are high for Germany's economics minister, who is in Montreal trying to remove the final obstacles.

Deutschland Demonstration gegen TTIP und CETA in Hannover
Image: DW/S. Kinkartz

Sigmar Gabriel's calendar has been consumed with the European-Canadian Comprehensive Economic and Trade Agreement (CETA). The German economics minister is a passionate advocate of CETA and believes it is a good agreement. "We have been able to achieve excellent conditions with Canada," said Gabriel joyfully before embarking on his journey to Montreal to discuss the final details with Canadian Prime Minister Justin Trudeau and Chrystia Freeland, Canada's minister of international trade.

Apparently, the EU has managed to conduct successful negotiations with Canada, unlike the problematic TTIP negotiations with the United States. "We no longer have private tribunals - that is what the USA wants at all costs," explains Gabriel. "We have a true market opening and it is particularly important for medium-sized companies that have been refused by the Americans." The protection of basic services is fixed, as is the right to remunicipalization and renationalization. "We have protection for cultural promotion and much more."

On the backburner for two years

Gabriel's list of accomplishments only recently found its way into the agreement as subsequent changes. The negotiations for the deal, which is expected to stimulate economic growth by eliminating tariffs and trade barriers like standards and norms, were technically considered done in 2014. However, due to growing resistance in the European population, the deal was put on the backburner because the Canadian side did not want to renegotiate. Only when the Trudeau government came to power was Canada willing to revise contentious issues with the EU. The process had officially been completed but there was still action behind the scenes.

Argentinen Mauricio Macri, Sigmar Gabriel und Joe Kaeser
Before his visit to Canada, Gabriel took part in an economic summit in ArgentinaImage: picture-alliance/dpa/Presidency of Argentina

Germany appears to be playing a key role. Perhaps it is because much is politically at stake for Sigmar Gabriel, who is also Germany's vice-chancellor. He went out of his way to make this deal work and he expected his party, the center-left Social Democrats (SPD) to follow him. The party's leadership has given him the green light. Now he seeks backing from the party's base. This Monday, 200 delegates will vote on CETA at a small SPD party congress in Wolfsburg, Germany.

Large demonstrations in seven cities

"At the SPD convention on the EU-Canada agreement I am sure that we will obtain a vote that will make approval in the EU Council of Economics possible," said Gabriel, who has the international trade and customs meeting in Bratislava on September 23 in mind. European trade ministers will decide which parts of CETA can be implemented without the approval of national parliaments. The CETA agreement is to be signed at the EU-Canada Summit in Brussels on October 27. The parts of the agreement that only the EU must approve will go into effect provisionally, although the term "provisionally" does not specify the amount of time, as ratification in member states could take years.

Opponents of the free trade deal are not pleased and have called for large demonstrations across Germany. With their motto, "Stop TTIP and CETA - we want fair global trade!" hundreds of thousands of protesters will take to the streets in seven major cities two days before the SPD party congress. The demonstration organizers, which include environmental, social and consumer protection organizations along with trade unions, have distributed 3.4 million pamphlets and have written a letter to the SPD party congress delegates calling for a rejection of the agreement.

Rebellious party base

"CETA strengthens the already dominating influence of corporations and weakens the democratic rights of citizens," reads the letter signed by Greenpeace and many other organizations, like Foodwatch and the German Association for the Environment and Nature Conservation (BUND). They all feel that subsequent amendments to the agreement are mere window dressing.

Deutschland Demonstration gegen TTIP und CETA in Hannover
The TTIP and CETA have continued to draw protests, like those seen here in Hanover in AprilImage: DW/S. Kinkartz

These are bad prospects for Gabriel. Four of the SPD's state associations and the entire left wing of the party categorically reject both free trade agreements. Legally, a "no" at the party convention would not be binding; however, it would weaken Sigmar Gabriel. Ultimately, he is the party's leader and will in all likelihood run as the SPD'S Chancellor candidate.

TTIP a pawn?

It comes as no surprise that Gabriel is pulling all the stops to make CETA appealing to the SPD. He has slowly been detaching himself from TTIP, the EU-US "Transatlantic Trade and Investment Partnership" that he long defended vehemently and considered necessary. The logic behind this move is obvious: he can partially yield to the demands of his opponents and drop TTIP to at least save CETA.

"In my opinion the negotiations with the United States have de facto failed, even though nobody is really admitting it," said Gabriel at the end of August. He drew plenty of criticism for this comment - from the chancellery as well. Angela Merkel said she was in favor of reaching an agreement and that the TTIP trade deal would also serve as a stimulus to alleviate unemployment across the EU. "That's why we should support everything that can create jobs, and that includes the free trade deal," Merkel said.

The politically unwise Chancellor

But Gabriel stuck to his guns. "Chasing an illusion, as though we could strike an agreement with the Americans who are absolutely not capable and willing to agree to European demands, and also constantly having to deal with demonstrations, is in my opinion, let's say, not a measure of political wisdom," he retaliated.

Does that give him more credibility in his party? The SPD vote will be held behind closed doors on Monday. Everything might turn out differently. There is behind-the-scenes speculation that Canada may want to continue bargaining and thus pave the way for renegotiation.

Should that happen, the agreement would not go into effect in October as planned. The publicly criticized points could thus be re-examined. Perhaps previous opponents could play a part in the new negotiations. "Canada and the EU are close in this agreement," Gabriel said recently. But he also added that there are few points "which I am sure will be addressed again in the European Parliament's consultation process." The final chapter of CETA remains to be written.