EU-Canada trade deal hits resistance in fortress Wallonia

[October 14, 2016]  By Philip Blenkinsop

NAMUR, Belgium (Reuters) - The Belgian fortress city of Namur, besieged by European armies down the centuries, issued a declaration of war on the global economic order on Friday with a vote to reject a planned EU-Canada free trade agreement.

The parliaments of the French-speaking region of Wallonia, which voted in its seat at Namur after that of the Brussels capital region earlier this week, risk killing the Comprehensive Economic and Trade Agreement (CETA). And yet it is supported by Ottawa and all 28 EU national governments, including Belgium's.

EU trade ministers meet in Luxembourg on Tuesday to vote on CETA and want unanimous backing for it ahead of a summit of EU leaders in Brussels on Thursday and a visit, if all goes well, by Canadian Prime Minister Justin Trudeau a week later.

Belgium's federal government led by liberal Prime Minister Charles Michel favors the pact -- one of his allies told Namur lawmakers they were making Wallonia "the Cuba of Europe". But he cannot approve it without support from assemblies representing the country's three regions and three linguistic communities.

Belgian officials, faced with the embarrassing hiccup on the very doorstep of the European Union institutions based in Brussels, have yet to say how they plan to react. France stepped up its pressure on its small francophone northern neighbor by inviting Wallonia's premier to talks in Paris later on Friday with his fellow Socialist, French President Francois Hollande.

Premier Paul Magnette, whose power base is the ailing post-industrial cities that once made Belgium a global manufacturing hub, said Canada was a friend but that CETA undermined standards for citizens and shifted too much power to big corporations.

Namur, dominated by a 17th-century citadel on the confluence of historic great trading rivers the Meuse and the Sambre, can expect to be besieged by anxious Europeans in the coming days.

EU leaders say nothing more or less than Europe's historic commitment to free world trade is at stake, including further planned deals with Japan and the United States.

Also paying attention are British officials whose hopes of a post-Brexit trade deal with the EU will also require unanimous support across the bloc -- including the stubborn Walloons.

"CUBA OF EUROPE"

The two regions of Wallonia and Brussels are home to 4.5 million people, less than 1 percent of the 507 million European consumers the EU-Canada free trade deal would impact. Even within Belgium, they are outnumbered by Dutch-speaking Flemings, whose representatives have already backed CETA.

A deputy wears a sticker against the Transatlantic Trade and Investment Partnership (TTIP) and Comprehensive Economic and Trade Agreement (CETA) during a debate on CETA, a planned EU-Canada free trade agreement, at the Walloon regional parliament in Namur, Belgium, October 14, 2016. REUTERS/Francois Lenoir

But Walloon lawmakers said during Friday's debate that it would harm local farmers, lower environmental and labor standards or give multinationals power over public policy.

"Just because we are friends with Canada, that doesn't mean we can't tell them we don't agree on something," said premier Magnette, before the chamber 46-16 against approving CETA.

Virginie Defrang-Firket, from Michel's liberal party, warned: "You will isolate Wallonia, make it the Cuba of Europe."

Some lawmakers wore stickers condemning CETA and the even more contentious EU-U.S. trade deal, known as TTIP.

CETA supporters say it will boost the EU economy by 12 billion euros ($13.4 billion) a year and create jobs.

Centrist Michel, a French-speaker, and his main allies from the Flemish right, face opposition on many issues from the left-led Walloons and some observers see the CETA vote as a tactic in a campaign to maintain state spending in the struggling south.

But resistance to new trade deals is strong, with the former coal and steel powerhouse of Wallonia just one of many European regions where economic globalization, with its shift of jobs to Asia, is mistrusted. Just last month, U.S. construction equipment maker Caterpillar <CAT.N> announced plans to close a plant just 30 km (20 miles) from Namur, cutting some 2,000 jobs.

(Editing by Alastair Macdonald)

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