Provincial pitfalls: Canadian provinces and the Canada–EU trade negotiations
Introduction The proposed Comprehensive Economic and Trade Agreement (CETA) between Canada and the European Union (EU) has a number of potential benefits. For Europe, it offers the possibility of improved access to the North American market, and serves as a template for other negotiations outside the stalled Doha Round of the World Trade Organization (WTO). CETA also compliments Canada’s long-term interests in balancing American trade dependence and limiting future trade disputes, which have previously damaged Euro-Canadian trade relations. Although Stockwell Day, Canada’s Minister of International Trade, and Québec Premier Jean Charest both promised to “deliver” the provinces in current CETA negotiations, this chapter will argue that a Canada-EU trade agreement – at least one that moves beyond existing trade commitments – will be limited by sub-federal interests. Specifically, Canadian provinces have a history of influencing Canada’s foreign trade policy and the evolution of international norms and standards. In the case of Europe, examples include long-standing disagreements related to alcohol and agriculture. Technical barriers focusing on geographic indicators, genetically modified food, and electrical standards are also contentious issues in ongoing CETA negotiations. Advancement on government procurement will also be restricted due to limited market potential, differences on bidding thresholds, and Canada’s recent Buy American agreement with the United States. In addition, Canadian provinces have no interest in liberalizing specific services, especially related to health and education, or significantly altering existing obligations for labor mobility. Finally, there is a perception among some Canadian officials that European negotiators are attempting to transfer EU standards and practices to the North American market. This has created an atmosphere of extreme caution within provincial negotiating teams, which further limits the possibility of a comprehensive, groundbreaking accord.