Brexit Britain should beware the trade policies of Justin Trudeau

The Canadian PM may be wooing the EU over trade negotiations, but the power balance will shift for Britain. 

NS

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Justin Trudeau, Canada’s prime minister, is planning to visit Strasbourg this Thursday. The baby-faced body-builder, who has been enjoying a love-in with the global media since his election just over a year ago, is hoping to charm MEPs, who he fully anticipates will have approved the Ceta trade deal on Wednesday. 

I, for one, will not fall under his spell. Behind the sweet smile, we see a stern expression when it comes to trade.

His visit to address the European Parliament comes hot on the heels of a meeting with President Donald Trump. The charm offensive aimed at shoring up the North American Free Trade Agreement (Nafta) seems to have paid off. Nafta was high on Trumps’ hit list of "very bad trade deals". But the joint statement issued after the meeting was conciliatory, stating: "No two countries share deeper or broader relations than Canada and the United States."

Still, it is more than charm that led to this softening of tone. Nafta was signed 30 years ago and has led to the close intertwining of the US and Canadian economies. Around three-quarters of Canada’s exports go to the US and some 2.5m Canadian jobs depend on this trade deal.

Which brings us to Ceta. Like Nafta, this is a trade deal that Trudeau knows is in the interests of Canada and large corporations. Greens have always opposed Ceta because of the power the treaty will grant corporations to sue governments over legislation that threatens their profits. The so-called Investment Court System (ICS) privileges private investment over the public interest and is inherently anti-democratic.

Trudeau’s itinerary this week gives a clear signal about who wears the trousers at global trade meeting. Canada relies heavily on the two major markets of the US and EU. This was underlined when Canada’s Finance Minister Bill Morneau told the FT that, while his heart nurses warm and nostalgic feelings about the UK, his head told him that the priority for Canadian trade was the US, EU, and China. He had not even thought about a Commonwealth trading bloc as a realistic possibility.

But while EU negotatiators may be able to bash out a deal to their liking, Brexit may leave us very vulnerable indeed. If this trade deal enters into force before the UK exits the EU, we will need to renegotiate our trade agreements with Canada. At the same time, we will still be bound by the ICS aspect of the treaty for 20 years. This would mean foreign investors would still have the right to sue the UK government if they feel their businesses have been impacted by new laws or regulations.

Furthermore, without the weight of the EU and its 510m consumers, the UK will be approaching any trade negotiations from a much weaker position. We also lack negotiating expertise. 

Ceta will also set a cat among the pigeons in Westminster. When the trade deal made the briefest of appearances in the House of Commons last week, shadow international trade secretary, Barry Gardiner, urged Labour MPs to vote against the deal. They instead voted 85 to 68 in favour, with a former shadow minister reportedly asking: "If we don't support a trade deal with liberal, Justin Trudeau-led Canada, who do we support trade deals with?”

But divisions in the Tory ranks could also open up too. Conservative MPs in rural constituencies find themselves trying to defend a deal which threatens famers and food producers with a flood of cheap, low quality, Canadian imports.

So signing up to Ceta is the worst of all possible worlds for the UK. It could take us back to square one on trade negotiations with Canada, and still trap us in a most toxic element of this treaty.

Trade is all about bitter and hard fought competition. The current national vision of skipping through daisy-filled meadows to the sunlight uplands of British greatness is a delusion we cannot afford.

Unlike my UK counterparts at Westminster, I will get to vote on whether Ceta is in the best interests of Europe and of post-Brexit Britain. Trudeau’s charm offensive is lost on me. Along with my Green colleagues I will vote against Ceta when it comes before the European Parliament.

Molly Scott Cato is Green MEP for the South West

Molly Scott Cato is Green MEP for the southwest of England, elected in May 2014. She has published widely, particularly on issues related to green economics. Molly was formerly Professor of Strategy and Sustainability at the University of Roehampton. She is Green Party parliamentary candidate for Bristol West.