Freeland sounds despondent note amid failed effort to rescue Canada-EU deal

Belgium’s Wallonia region is the holdout now blocking the way forward for the Comprehensive Economic and Trade Agreement

OTTAWA – About two months ago, when the ink had dried on the 1,600 pages of the Canada-EU free trade deal, two politicians decided another document — a mere five pages — would be necessary to tie up any loose ends.

Sources say it was those five pages, and not the deal itself, that proved pivotal Friday as last-ditch talks in the European Commission collapsed, with the holdout Belgian region of Wallonia refusing to end its blockade of the long-sought deal.

A dejected-looking International Trade Minister Chrystia Freeland walked out on the talks in Brussels, her tone and her words suggesting the deal was all but dead.

“It is now evident to me — evident to Canada — that the European Union is incapable of reaching an agreement, even with a country with European values such as Canada, even with a country as nice and as patient as Canada,” she said in French, her voice breaking.

“Canada is disappointed and I personally am disappointed, but I think it’s impossible. We are returning home. At least I will see my three children tomorrow at our home.”

However late Friday Martin Schulz, the head of the European Parliament, appeared to announce on Twitter that he would meet on Saturday morning with Freeland and Paul Magnette, the president of holdout Belgian region Wallonia, to try to revive the talks.

“We can’t stop at the last mile,” Schulz tweeted from a verified account on Friday evening.

A spokesman for Freeland could not confirm whether there was to be a meeting Saturday.

With the deal in peril, Prime Minister Justin Trudeau has held back from announcing whether he will attend the Oct. 27 Canada-EU summit, a date set months ago as the official signing date for the agreement.

Interim Conservative leader Rona Ambrose tweeted Friday that it was time for Trudeau to get personally involved in the talks.

“Absolutely unacceptable to throw in the towel on a critical trade deal,” Ambrose tweeted.

Canadian sources say the PM is not preparing, for now, to fly to Europe over the weekend, but he has been personally involved in the talks — including a phone call with his Belgian counterpart.

It was Freeland herself and German Vice Chancellor Sigmar Gabriel who pushed for the creation and adoption of the document at the heart of the impasse, five pages that became known as the “Joint Interpretative Declaration.”

It was aimed at critics of the deal known as the Comprehensive Economic and Trade Agreement, including left-leaning politicians in Europe as well as the clamouring anti-trade civil society movement, as an “unambiguous statement” to assuage concerns over “provisions that have been the object of public debate and concerns.”

Sources say the deal itself was not open to renegotiation, but the interpretative declaration was fair game.

In the end, that wasn’t enough for Magnette to keep the agreement from ripping apart at the seams.

In the hours leading up to Freeland’s explosive exit, sources — speaking under condition of anonymity due to the sensitivity of the talks — told The Canadian Press that Magnette was determined to re-open the text of the agreement itself and renegotiate the details of specific Canadian agricultural products that would be allowed into the EU.

A source said that the work already done in entrenching the tariffs and quotas attached to specific brands of cheese and meat in the agreement itself simply could not be unravelled at such a late stage.

In recent days, Magnette also expanded the scope of his earlier concerns — protecting his tiny Belgium region’s farmers from larger interests — to take on the newly configured investor-state dispute resolution mechanism.

Magnette said “difficulties remain” in the talks, notably the politically sensitive issue of how multinational corporations could challenge states under the deal.

Freeland worked hard to renegotiate that part of the agreement after Gabriel raised his own possible deal-killing objections to the provisions in 2014.

In the new, five-page annex, a full page is devoted to the subject, describing how a new “independent, impartial and permanent investment tribunal” would take shape and operate.

One source said Magnette has started to dig into “the substance of the treaty,” and has expressed frustration that he was shut out of the negotiations.

Maude Barlow, the head of the Council of Canadians, an organization that adamantly opposes liberalized trade, said Magnette isn’t just speaking for the Walloons; he’s speaking for groups such as hers over what they see as a flawed approach to solving disputes between investors and states.

“The only way to address these legitimate concerns is to reopen the deal itself and change those provisions that give foreign investors and big corporations such power to dictate government policy,” Barlow said.

Opposition Conservatives, who forged the Canada-EU agreement when they were in power, were outraged at Freeland’s apparent decision to throw in the towel.

“Roll up your sleeves and don’t leave,” demanded Gerry Ritz, the party’s trade critic and former agriculture minister.

Ritz said it was a mistake to open a door by adding the five-page declaration after the fact.

“You can’t please everybody — you can’t give everybody a get-out-of-jail free card.”

Ritz said he and former trade minister Ed Fast sat through some tough negotiations with Europe and “agonized for hours” over the fine print.

“You don’t complete a deal this comprehensive by walking away at the final hours,” Ritz said in an interview.

However, one of Fast’s former top aides, disagreed.

“For Canada, leaving the table at this stage is the right move because it’s up to the EU to negotiate within and come back to Canada with a proposed solution,” said trade consultant Adam Taylor.

“Canada’s negotiating partner is the EU, not Belgium.”

Sources say that at the close of talks Friday, another possible solution was off the table: Belgium simply ignoring the Walloons and giving its approval anyway.

Belgium’s constitution gives its three self-governing regions, including Wallonia, a veto over what the national government can do. But some are arguing that the Belgians should ignore the Walloons even if that starts an internal constitutional fight. That’s because any internal Belgian legal struggle would take years to resolve most of CETA would have come into force.

For now, that option is off the table, said a source, because any ensuing legal battle within Belgium would be an ugly sideshow to the trade deal.

“This would not be a good start for the CETA.”

David Lametti, Freeland’s parliamentary secretary, said Friday that Canada has looked at every option to reach an agreement and it’s up to Europe to decide.

“The ball is now in their court.”