By Julian Dierkes

CETA, the Comprehensive Economic and Trade Agreement between Canada and the EU, is lurching from one near-death experience to the next. In mid-September, more than a quarter million people demonstrated against CETA in Germany. Last Sunday, Francophone Belgians voted against the agreement. That may have been a lethal blow.

But since the agreement had been hailed as a “new generation” trade agreement by the Liberals, it is noticeable that the discussion in Canada has been very muted. That is a risk to future decisions on trade. It is easy to sneer at the EU as a supranational body in shambles, but its failure may have come in a lack of engagement of stakeholders. The same lack could be observed in Canada, but the stakeholders did not revolt to the same extent.

The Canadian government will need to embrace tools to engage stakeholders and Canadians in a discussion and decision about the merits of such free trade agreements if potential failures such as CETA ratification are to be avoided here.

European Criticisms of CETA

Some of the criticisms of free trade in Europe are somewhat simplistic, knee-jerk reactions, even more so as CETA is portrayed as a stepping-stone toward the Transatlantic Trade and Investment Partnership (TTIP), a similar agreement with the U.S.

But some of the criticisms should be taken more seriously, as they address precisely the “next-generation” aspects of CETA that the Liberal government seems to be pursuing following the Conservative lead.

What makes this a different free trade agreement is that it goes beyond tariffs by addressing non-tariff hurdles and challenges to access. That is public procurement on the one hand, but, perhaps most controversially, protection for foreign investors, the infamous-in-Europe “investor state dispute settlement”. The Liberal government has made very little effort to explain to Canadians why these are desirable elements, a task that European governments have also failed at, apparently.

Most of the responses to criticisms of dispute settlement have been technical in nature. From the original provisions of ad hoc private arbitration boards, CETA in the end envisioned permanent arbitration courts. But European critics ask two more basic questions:

• both, Canada and the EU, have well-institutionalized predictable legal systems, why do foreign investors need to be “protected” by a different mechanism?
• if foreign investors are able to “protect” their investment by suing host governments following (democratically legitimated) regulatory decisions, to what extent does that hamper future regulation?

Lessons for Canada

Again, these criticisms have been muted in Canada, but they probably do resonate and might become more of an issue in other contexts like the Transpacific Partnership (TPP, likely doomed by the U.S. electoral circus), but even more so in considering a free trade agreement with China, for example. They are much less of a challenge in bilateral deals like the pending agreement with Japan that is less comprehensive, perhaps.

So, while CETA died in Europe, future Canadian efforts might include a focus on active involvement of stakeholders in deliberations prior to trade negotiations and to more engagement during and after negotiations. That is not to say that trade agreements should be put to an online vote at all. Nor that elements of negotiations should be disclosed. But instead, direct and digital diplomacy tools should be mobilized to explain the benefits and all elements in trade agreements to Canadians. This is where a digital diplomacy might focus on domestic stakeholders as much as on negotiation partners abroad.

Currently, free trade agreements are largely concluded on behalf of business interests in Canada, under the assumption that they will benefit Canadian consumers and employees. That assumption is being questioned by European critics. If the Liberals are certain that these kind of agreements will bring benefit to individuals Canadians, as many experts also agree, they should involve the interested public more directly in their deliberations. Trade negotiations are at the core of diplomacy, and diplomacy in this day and age should be direct and digital. Yet, CETA deliberations were primarily limited to consultations that the seemingly inexhaustible Minister of International Trade, Chrystia Freeland, has been conducting around the country.

After having started their tenure under the theme of transparency and openness, the Liberals should seek more ways to engage Canadians directly on free trade. This can be done through social media platforms, for example, by going beyond the endless tweeting of photos of Minister Freeland meeting with colleagues around the world. Instead, technologically enabled direct and digital diplomacy should build platforms that allow Canadians (expert or “merely” interested) to contribute to deliberations about policy, rather than comment on decisions that have been taken.

Such platforms do not really exist yet, but the importance of stakeholder engagement in consideration of free trade agreements makes a strong case to use this engagement as an impetus for the development of channels to involve Canadians directly in deliberations.