Canada walks out as EU trade talks founder

it had been impossible to overcome the differences with Wallonia, a French-speaking region of barely 3.5 million people.

So, depending on whether the trade deal is a good or bad thing, either this demonstrates either the strength or weakness of Europe's attempt to create a supra-national economic community based on self-determination.

See, in the US, when the South no longer wished to remain unified, we compelled them to believe...

The UK will also find it impossible to reach a trade deal with the EU unless it also accepts free movement of people.

This is a prima facie example of the failure to reform the common agricultural policy of the EU. Where whole regions are dependent on a dysfunctional methodology of programmes that involve agricultural subsidies over restructure and reform.

The equation is a simple one, farmers make up 3.25 % of the EU’s total population, generating roughly 6.75% of GDP. Yet astonishingly receive 30% of the EU’s total budget through a series of corrosive subsides, resulting in over production and waste. To put numbers to this. It's €68 billion to a 3.25% minority. Economically nonsensical . The same economically ludicrous logic is turned upside down when analyzing the Euro-zone fiscal and monetary policy.

One thing the article doesn't mention is that the European Court of Justice is set to rule in January on whether the Investor State Dispute Resolution (in the Singapore deal) is legal under EU law. If it's held to be illegal, CETA and TTIP (with similar ISDS provision) are dead in the water, regardless of the Wallonian vote.

Logically, how can anyone accept a situation where a Canadian company operating in Germany is allowed to sue and collect damages from the German government for passing a particular regulation, while an Irish or Spanish company operating in Germany cannot? ISDS is just crazy in the European context. It completely distorts the single market.

@itsonlyrocknroll

The CAP share of the EU budget only looks dramatic because they EU budget is not as big as people think it is. It used to be 70% of the budget back in the 80s. The CAP really shouldn't be called part of the EU 'budget' in my opinion, since it's just a transfer payment from the member states to farmers which just happens to be administered by the EU. If it didn't exist, member states would be funding their own subsidies directly with even more inefficiency. However, when you consider that €68.5 is only 0.415% of total EU GDP, it's actually not that dramatic.

I agree that CAP should be reformed and cut down, but only to stop paying huge landowners who are unlikely to every use their land to farm. But the CAP is not going away and I wouldn't be in support of getting rid of it. When you look back at the history of Europe after the war, the CAP is almost the 5th freedom; The freedom to have supermarkets overflowing with delicious locally produced food at affordable prices for everyone (at the point of sale). I, and most Europeans, don't want European food to turn into American frozen meals made with high fructose corn syrup made by ADM and Cargill, or to go with the Japanese model where you pay 200yen for 1 unfresh tomato, shrink wrapped on a styrofoam tray. What specifically would you change about the CAP, or are you just ideologically opposed to any kind of subsidy whatsoever?

The more that the EU looks like an unreliable trade partner, the better for post-Brexit Britain as it seeks trade agreements with the countries the EU has rejected.

The EU is history. Just prolonging the inevitable.

@Steven C. Schulz

I agree to some extent, but I think what this will do is make countries think a bit more carefully about whether high-flying trade negotiators should be allowed to waste 7 years building up ridiculously complex deals that are very likely to fall apart, or whether we should all dump provisions like ISDS and draconian copyright rules to focus only on the real and sensible aspects of free trade where we have broad consensus. I think it's clear that deals like CETA, TTIP and TPP are too ambitious. They are so big that everyone is able to find at least one provision that they despise.

The concept that an group as an organization has the authority and the right to make contracts for individuals that have different needs, circumstances, and objectives etc. cannot be expected to "conform" to the objectives and needs that benefit that individual. It is like the UN that may have the entire global benefits in mind but ends up confronting differences in needs and circumstances that is not necessarily idealistically fair, equal, balanced or even beneficial to one or more of the member countries. That is exactly why a group breaks up or as with Britain, exit from that group.

Negotiations and contracts for what ever purpose and reason is extremely difficult to do as a group.

The concept of globalization and united common purpose may be nice idealistically, but it is the individuaity, the differences that makes thing work and not a pretended or even a contractual unity.

Hi, M3, The politics surrounding CAP goes far deeper than ideological opposition, underlining the theory of agricultural subsides. The suggestion that CAP is a protection mechanism to salvage the quaint ideal of protection for small farm holdings and their rural way of life is a smoke screen, frankly a myth. The real beneficiaries are conglomerates the likes of Campina, Unilever and Nestle.

These giant players have the where with all and budgets lobby the likes of Manfred Weber, leader of the EPP Christian Democrats, and Martin Schulz President of the European Parliament. That notably has become involved in the fracas even though it is outside his remit.

Schulz on his meetings with Chrystia Freeland and Paul Magnette.....

http://www.europarl.europa.eu/the-president/en/press-room/schulz-on-his-meetings-with-chrystia-freeland-and-paul-magnette

Any amount of arm twisting and bribery will not escape the toxic independent court system to settle disputes which will be utilized with impunity by the multinationals to shut out the little guys.

@itsonlyrocknroll

The suggestion that CAP is a protection mechanism to salvage the quaint ideal of protection for small farm holdings and their rural way of life is a smoke screen, frankly a myth. The real beneficiaries are conglomerates the likes of Campina, Unilever and Nestle.

I agree, we shouldn't be fooled by an idealised view of the countryside when it comes to CAP. However, honestly, I don't have a huge problem with the fact that the largest companies are recieving the largest share of the subsidy, provided that they are genuinely involved in the largest share of European food production (but perhaps you can tell me why I'm wrong on this). If you stop providing CAP subsidies to these companies simply because they have reached a certain size, they will probably just split themselves up into 10,000 smaller subsidiaries. It seems like any reform has to based on some criteria other than size.

What seems really dubious are the payments to landowners who aren't even involved in food production. I understand the arguments about preserving biodiversity and environmental protection but this really seems to be where the abuse is. I don't think the Queen or the Duke of Marlborough are going to cut down all the trees on their estates and start flooding the market with surplus beets if their CAP windfall is withdrawn. I'd much rather see surplus production and go for a swim in a wine lake or climb a butter mountain than pay wealthy people not to farm year after year.

Any amount of arm twisting and bribery will not escape the toxic independent court system to settle disputes which will be utilized with impunity by the multinationals to shut out the little guys.

Toxic is a good word. ISDS might have a role to play when dealing with some third world dictatorships that might try to expropriate your assets, but it really has no place in a trade deal between democratic first world countries.

I guess we'll have to wait and see what happens next week. Things might be rather interesting if they get desperate.

Hi M3 Let flesh this out, accounts alone show between 2010 to 2014 the Duke of Westminster £1,422,004, Lord Carrington £512,000, and Prince Charles £991,000. All pales in comparison to Tate and Lyle......

That's a cool €594,270,084...since 1999..... Wallonia must dig its heels in deep.

http://farmsubsidy.openspending.org/GB/recipient/GB47951/tate-lyle-europe-031583/

Did you spot Theresa May duplicity at the press conference before her early morning departure, add in, Merkel has dismissed outright demands for any fiscal depreciation of Germanys export surplus. That a current account surplus of 305.28 billion Euros.

ECB /Mario Draghi has urged strongly that Germany must correct the fiscal and monetary imbalances of debtor Euro-zone countries. Portugal, Spain, Greece, Italy have little or no possibility of balancing what is owed. All current Euro-denominated liabilities are primed for default. Brexit is just a spot on the horizon in comparison.

@itsonlyrocknroll

All pales in comparison to Tate and Lyle...

And to add insult to injury, I believe Tate & Lyle was one of those British companies that was tacitly supporting Brexit since they think they can get the UK government to drop all tarriffs on sugar cane.

Did you spot Theresa May duplicity at the press conference before her early morning departure

Yes, it was quite duplicitous. 'My aim is to cement Britain as a close partner of the EU, once we have left', 'Yes the UK will be a fully independent sovereign country... but we still want to trade freely in goods and service'.

Wallonia must dig its heels in deep.

It seems like they are prepared to do so. Paul Magnette seems like quite an impressive leader. He gave a very good speech setting out the case against CETA in the Walloon parliament last week, and based on his passion I think it looks like they are ready to stand firm. The fact that Martin Schulz met with Freeland and Magnette seperately says alot about how far apart they must be. I've looked for a version of the speech with English subtitles but there doesn't seem to be one. On the off chance that you might speak French (since you are always headed to Paris), I'll link to it below:

https://www.youtube.com/watch?v=B5GhqxWeqzQ

It will be interesting to see if Merkel survives the next round of elections, and if not, who will replace her. Perhaps someone slightly more flexible in terms of bailing out southern Europe and the banks? I'm not sure who the frontrunners in Germany are at the moment. In France, Juppé is once again threatening to tear up the Le Touquet treaty which could see Britain go back to the 2002 levels of 80,000 asylum seekers per year (or more). 2017 might be another eventful year.

If the EU can't even agree on a deal with friendly Canada, what hope is there for a hostile and recently departed Britain?

@M3M3M3

I've become less enthused with free trade over the years, although I support the TPP for geopolitical reasons. I would clarify, however, that ISDS is a lot scarier on paper than in reality. NAFTA has an such a system, and the governments win consistently more than the investors. The idea that investors can force wide-ranging policy changes is just not borne out in the resolutions. If there is a onerous stipulation of TPP, it is the deregulation clause and ratcheting clause that prevent the government from nationalizing utilities or renationalizing them once deregulated.

I also tend to agree with the general idea that trade agreements of this scale are probably at their end. There was a good reason for them - the failure of the Doha round of GATT to remove more tariffs and non-tariff protection from WTO general trade - but they now encompass many non-trade areas and have entered into some areas of general policy, which I agree is inappropriate.

To segue, I want to make clear that my support, as an American, for Brexit has to do with the Lisbon Treaty and the ECJ's subsequent claim of oversight over more areas of British law. Ideally, I would like to see Britain in the EEA, even if it keeps the doors open to continental immigration; however, that seems unlikely at this point.

It will be interesting to see if Merkel survives the next round of elections, and if not, who will replace her.

Whether Merkel is still Chancellor or not, I think we can expect a CDP-led coalition, as the SDP is even more pro-EU. I feel that's it's quite safe to say that any further direct assistance to southern Europe is out of the question in Germany. Things will definitely get worse between Germany and southern Europe if Italy's constitutional referendum fails in December, as looks likely.

I think we can also be certain that the president of France will be from Les Republicains, with a few populist measures stolen from the Front National's platform. I think scrubbing Le Touquet is no more than campaign speak - given the militancy in Britain over immigration at the moment, I wouldn't be surprised if non-aviation links to France were cut in response, and I'm sure the French have that inkling too.

As you say, 2017 will be interesting.

Hi M3, I received a note earlier detailing hopes of deal to push CETA through have all but been dashed by a statement from Belgium Prime Minister indicating he is unable to sign the trade deal because of the failure to get cooperation from Wallonia regional government. Now will the EU commission/parliament try to bulldoze this through?......If so there will be hell to pay.

@itsonlyrocknroll

Yes, it will be interesting to see what they have planned. Hopefully something positive will come out of it like a radical renegotiation of certain provisions in the agreement, but that doesn't look likely.

@Steven C. Schulz

Perhaps like many people you have actually become less enthused about deals for big special interests rather than genuine free trade. One thing I would say about ISDS is that I think your stats only tell half the story. You have to consider settlements and not just wins. According to the Transatlantic business council, 58% of ISDS actions in America yield a positive result for companies (either a win in a full tribunal or collection of a settlement) and the number is 64% in Europe. Law firms are publicly advising their clients that threatening ISDS can be a good way to secure the regulations they want. Ten years ago nobody could have predicted that the number if iSDS cases would have skyrocketed as much as they have. If the treaties were more precise then perhaps it wouldn't be as big of a problem, but the ambiguity makes ISDS a huge risk for society.

ISDS also distorts the free market. The reward for implementing a stable and fair justice system should be the ability to attract international investment. It's a win-win for corporations and ordinary citizens. But by implementing ISDS only for foreign corporations, places like Bulgaria and Hungary will have less of an incentive to do the hard work of reforming their legal systems but they will enjoy all the benefit of foreign investment. While places like Latvia, which has done a great deal to reform, won't be reaping as much of the rewards as they would otherwise have received if ISDS did not exist.