The European Parliament has approved a new Canada-EU trade deal, in what is being hailed as an “exciting milestone” after nearly a decade of challenging negotiations.
CETA, or the Comprehensive Economic and Trade Agreement, is considered one of the most significant Canadian trade deals since the North American Free Trade Agreement.
However, last year, it was nearly canned after Wallonia, a small region in Belgium, rejected it, prompting the Canadian delegation to walk out.
Justin Trudeau finally signed the deal in October, along with European Council and European Commission presidents, Donald Tusk and Jean-Claude Juncker, in Brussels.
On Wednesday, the European Parliament voted in favour of the deal, bringing it one step closer to reality. The deal was approved by 408 votes to 254, with 33 abstentions.
— European Parliament (@Europarl_EN) February 15, 2017
In a release, Trudeau said CETA sets a new bar for progressive trade agreements and he was pleased the EU had voted to support it.
“Today’s vote is an exciting milestone on the way to bringing the benefits of these progressive free trade and partnership agreements to Canadians and Europeans,” said Trudeau.
“These agreements set the stage for an even stronger relationship with the EU, which will create greater opportunities for the middle class on both sides of the Atlantic.”
Artis Pabriks, the European Parliament’s rapporteur for CETA, said the EU and Canada had chosen openness and growth over protectionism and stagnation.
“Canada is a country with whom we share common values and an ally we can rely on,” said Pabriks in a statement, going on to allude to recent events in the US.
“Together we can build bridges, instead of a wall, for the prosperity of our citizens,” he said. “CETA will be a lighthouse for future trade deals all over the world.”
Trudeau will address the European Parliament on Thursday, the first time a Canadian Prime Minister has ever done so.
CETA is expected to come into force in the spring, pending its ratification by all EU national and regional parliaments, and the passing of the related bill C-30 by the Senate in Canada.
The EU is the world’s second largest single market and has a population of over 500 million people.
It is also Canada’s second largest trade partner after the United States, the second largest source of foreign direct investment (FDI), and the second most important destination for outgoing foreign direct investment from Canada.
In 2013, Canada exported $49.2 billion in goods and services to the EU whereas Canada’s imports from the EU reached $62.5 billion.
FDI from Europe was pegged at $191.4 billion during the same year, and Canadian FDI in the EU was $187.2 billion.
It is anticipated that CETA will increase Canada-EU trade by 20% and boost Canada’s income by $12 billion annually by providing both markets with broad access to each other’s goods and services.
It will abolish most tariffs, provide Europeans with access to bid on Canadian government procurement projects, and liberalize trade in services.
It is unclear as to how much EU-Canada trade will be impacted by Brexit – the United Kingdom’s vote to leave the European Union.
Approximately half the FDI that currently goes from Canada to Europe every year goes through London.