Canadian Prime Minister Stephen Harper is traveling to Brussels today in a bid to conclude a free trade agreement with the European Union.
Harper, who told lawmakers yesterday his government will soon complete the trade pact, will meet with European Commission President Jose Barroso during the two-day trip “with the goal of concluding” negotiations, his office said in a media advisory.
Canadian and European negotiators have reached an agreement in principle on a free trade pact, officials from both sides who are familiar with the matter said, speaking on condition they not be identified because the pact hasn’t been made public.
“Our government launched the most ambitious trade agenda in Canadian history,” Harper said in a mid-term update of its agenda yesterday, adding he “will soon complete negotiations” with the European Union.
A successful trade pact with the EU could help Harper burnish his reputation as a competent economic manager, an advantage he holds over his rivals. Even as the ruling Conservatives have fallen in public opinion polls amid an expenses scandal implicating some of his lawmakers, Harper continues to have an edge on economic issues, surveys show.
Canada has averaged annualized quarterly growth rates of 1.3 percent since the start of 2012, down from 3 percent in 2010 and 2011, in large part because of sluggish exports, which are down 1.2 percent since the end of 2011.
Canadian executives had been warning that Harper was running out of time to complete an agreement amid concern that talks with the U.S. will leapfrog Canada as a priority for Europe. Canada’s largest manufacturing lobby group called on provincial leaders yesterday to back the agreement.
“Canadian Manufacturers and Exporters hope that we can count on your support when negotiations are finally concluded,” the Ottawa-based group said in an open letter to provincial premiers. It is “a critically important agreement.”
Canadian companies such as Toronto-based insurer Manulife Financial Corp. (MFC) and Montreal’s commercial-jet maker Bombardier Inc. (BBD/B) have backed an agreement, while European companies including engineering conglomerate Siemens AG (SIE) of Munich and London-based miner Rio Tinto Plc (RIO) are supportive.
An agreement would increase annual Canadian gross domestic product by 8.2 billion euros ($11.1 billion), equivalent at the time to about 0.77 percent of the country’s output, according to a joint study released in 2008 by the Canada and the European Commission. The EU economy would increase its annual output by 11.6 billion euro, or 0.08 percent.
While the EU bought 8.9 percent of Canadian exports in 2012, Canada represented 1.9 percent of total EU exports, according to Statistics Canada and Eurostat data. The U.S. received three-quarters of Canada’s exports in August.
Greater concessions on beef will help Harper sell an agreement to Canadians that may increase the cost of prescription drugs by expanding patent protection for European pharmaceutical companies, harm Canadian dairy farmers and take away power from cities and provinces to choose suppliers for procurement projects.
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