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German Chancellor Angela Merkel, shown next to her husband Joachim Sauer, will visit Canada this week. (MICHAELA REHLE/REUTERS)
German Chancellor Angela Merkel, shown next to her husband Joachim Sauer, will visit Canada this week. (MICHAELA REHLE/REUTERS)

Peter Harder

Canada must take necessary steps to clinch European trade agreement Add to ...

This week’s visit by German Chancellor Angela Merkel is further proof that Canada is making its presence felt on the global stage for the first time in years. It follows intensive efforts to advance Canada’s trade agenda, and builds upon Canada gaining admission to the Trans-Pacific Partnership (TPP) trade agreement negotiations in late June.

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Prime Minister Stephen Harper’s government is also expected to announce the release of a Canada-China economic study shortly setting out the strong rationale for continued efforts toward deepened and strengthened bilateral trade and investment ties. The beginning of Canada-China bilateral trade discussions could be just as historic as Canada’s entry into TPP.

While this level of activity is impressive, Canada has challenges to overcome notwithstanding its ambitions. International Trade Minister Ed Fast and his officials have the difficult job of convincing our trading partners that Canada is committed to achieving the high standards of 21st-century trade agreements that will grow our economy and improve our competitiveness.

The litmus test for the government’s trade efforts lies in clinching a deal with the European Union. Successful conclusion of the comprehensive economic and trade agreement (CETA) negotiations is viewed by many as key to the success of the Prime Minister’s larger trade agenda. Hence the importance of this week’s visit by Ms. Merkel, whose support is critical to CETA. Concluding CETA would give Canada access to the world’s largest common market of 500-million consumers, with economic studies showing an annual boost of $12-billion in economic activity.

With such significant gains to be had, it is mystifying that one of the remaining issues is reported to be Canada’s uncertain commitment to strengthening its intellectual-property standards, which includes harmonizing our life-sciences IP standards to EU standards. If Canada is to be taken seriously by its major trading partners, there can be no doubt about our commitment to upgrading to IP standards commensurate with Canada’s position as an innovative economy.

Canada has a substantial life-sciences research-and-development footprint, which we should be trying to grow because it means more high-value jobs for Canadians. Moreover, the EU values public health care as much as Canada does, and is just as serious about managing its health-care costs. So how does one respond to the fear-mongering over alleged cost increases resulting from harmonization with EU standards? In my estimation, one answers with a question: What have we learned about the health-care cost impacts of IP improvements since the North American free-trade agreement? The answer is that our health-care system was not affected and both Canada’s generic and innovative pharmaceutical industries prospered.

Big trade deals call for big decisions, and the Harper government is nearing the endgame on CETA. It would be a tragedy for Canada to fail in concluding negotiations with the EU over proposals that are in its own interest, only to then face similar proposals made by other nations in the context of other continuing negotiations. It would also confirm our trading partners’ doubts about our level of commitment to truly ambitious outcomes.

I cannot help but think that the Prime Minister has already thought this through and is preparing to take bold steps in the right direction. The timing of Chancellor Merkel’s visit could not be better.

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