Canadian blast across EU’s bows over transatlantic trade

Date: 30/04/1998

By Mark Turner

OTTAWA has issued a tough warning that any dramatic new transatlantic trade initiatives must not leave Canada out in the cold.

"If the Union's relationship with the US is privileged in any way over Canada, that would have an effect which we would not welcome," the country's EU ambassador Jean-Pierre Juneau told European Voice. "People must understand that there is an integrated North American market now."

Although France this week effectively scuppered Trade Commissioner Sir Leon Brittan's proposals for a New Transatlantic Market-place, the Union is still likely to look for other ways to improve trade ties at next month's EU-US summit.

Juneau claims that talks are more likely to succeed if Canada is involved. "People should not neglect the value of the expertise and interest that we could bring to this process," he said. "Rather than complicating the negotiations, as some people think, we could actually facilitate them."

The Canadian ambassador also expressed the hope that the European institutions could overcome their tendency to neglect the northern portion of the American continent.

"One of our most important challenges is to make sure that the EU institutions and the Commission do not lose sight of the indispensable role that Canada has played in transatlantic relations," he insisted.

The Union is Canada's second most important trade partner after the US, absorbing 6% of total Canadian exports and 29% of its non-US exports between 1985 and 1997.

Last year, Canada exported around 9 billion ecu worth of goods to the EU and imported 17 billion: a large deficit which officials privately hope will be reduced with the advent of a strong euro. In addition, the Union is Canada's largest source of foreign direct investment, accounting for 20% of stock last year.

Canada is also one of the EU's top-ten trade partners, accounting for 2% of its imports and 1.7% of its exports in 1996.

Two years ago, both sides signed an action plan, mirroring a similar EU-US initiative, calling for a substantial improvement in trade ties.

Next month, they are expected to sign Mutual Recognition Agreements covering trade in pharmaceuticals and medical devices worth 2 billion ecu.

Ironically, Canada now appears considerably more willing to pursue trade liberalisation than the US, and has spearheaded calls for a free trade zone for the Americas and also with Europe.

"Our prime minister already proposed negotiating a free trade agreement with the EU in 1995, and this request was reiterated last October in London," said Juneau. "We are following Sir Leon Brittan's proposals with the clear understanding that we could be part of the initiative eventually."