(Corrects to North American Free Trade Agreement in paragraph
* EU, Canada finally close talks launched in May 2009
* Deal is Europe's first with a G8 economy
* EU hopes to use it as stepping stone to pact with U.S.
By Robin Emmott and Philip Blenkinsop
BRUSSELS/LUXEMBOURG, Oct 18 The European Union
and Canada agreed a multi-billion-dollar trade pact that will
integrate two of the world's largest economies and paves the way
for Europe to clinch an even bigger deal with the United States.
Talks were launched in May 2009 but stalled for months over
quotas for Canadian beef and EU cheese. Canadian Prime Minister
Stephen Harper and European Commission President Jose Manuel
Barroso met in Brussels on Friday to resolve outstanding issues.
In a cheeky touch, chefs served Italian gorgonzola and Greek
feta cheese at a four-course lunch laid on for the two leaders
to celebrate the EU's first trade deal with a member of the
Group of Eight biggest world economies.
"This agreement is a landmark achievement for the
transatlantic market," Barroso told a news conference, flanked
by Harper. "With political will and a good dose of hard work,
there is a way to reach a result that benefits people on both
sides of the Atlantic," he said.
EU trade chief Karel De Gucht called the Canada accord a
"template" for Europe's negotiations with the United States.
The deal marks a breakthrough for Brussels' free-trade
agenda, which had previously achieved smaller agreements with
South Korea and Singapore. It is expected to increase bilateral
trade in goods and services by a fifth to 25.7 billion euros
($35 billion) a year, according to the latest EU estimates.
Barroso said he hoped the agreement could come into effect
from 2015, after EU governments, the European Parliament and the
Canadian provinces give their blessing.
However, France signalled some reservations about an influx
of Canadian beef under the deal, even if its Munster and
Camembert cheese will now fill shelves in Canada's supermarkets.
"I am waiting for confirmation from the Commission that this
accord, particularly in agriculture, does not a set a precedent
for talks with the United States," said French Trade Minister
Nicole Bricq at a meeting with De Gucht and her peers in
For Canada, the deal will make it the only G8 country - and
one of the only developed nations anywhere - to have
preferential access to the world's two largest markets, the EU
and the United States, home to a total of 800 million people.
"This is the biggest deal our country has ever made," Harper
said, adding that it outstripped the North American Free Trade
Agreement between Canada, the United States and Mexico.
'OUTRAGEOUS' BEEF DEAL
The Commission is negotiating trade pacts with more than 80
countries on behalf of the bloc's 28 members, following the
collapse of the marathon Doha round of global trade talks. The
delays that dogged the Canada agreement showed how difficult
such deals can be.
European efforts to sign a free trade accord with the United
States faced a setback this month when a second round of
negotiations was cancelled because of the U.S. government
Despite plans to do a deal by the end of next year, the
talks have also been overshadowed by reports the United States
bugged EU offices under surveillance programmes made public by
fugitive former intelligence contractor Edward Snowden.
Still, the Canada agreement should provide a boost for
EU-U.S. negotiations. Both deals seek to go far beyond tariff
cuts and to reduce transatlantic barriers to business. There are
also similar sticking points, such as agriculture.
"It's a good signal. I'm a transatlanticist," German Economy
Minister Philipp Roesler told Reuters in Luxembourg.
"It's a great basis for all other negotiations, such as the
TTIP talks with the United States," he said, referring to the
proposed deal by its formal name, the Transatlantic Trade and
The EU-Canada pact would eliminate tariffs on almost all
goods and services, set larger quotas for EU dairy exports and
make it easier for EU carmakers to export vehicles to Canada.
For the first time, provincial governments in Canada will
commit to opening their lucrative procurement markets to allow
European companies to compete for contracts alongside locals.
The EU will eliminate duties on a range of Canadian
agricultural products, from wheat to maple syrup. Canada will be
able to export 80,000 tonnes of pork and 50,000 tonnes of beef
free of duties to the European Union.
But French beef farmers said they were "outraged". "Worst of
all, the (European) Commission is blindly preparing for a deal
with the United States that will hasten the bankruptcy of farms
and jobs in the sector," France's beef farm federation FNB said.
(Additional reporting by Luke Baker in Brussels and Ingrid
Melander in Paris; editing by Tom Pfeiffer)