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A European Union flag waves above the ancient Parthenon temple, at the Acropolis Hill, in Athens on Monday, July 11, 2011. (Petros Giannakouris/AP)
A European Union flag waves above the ancient Parthenon temple, at the Acropolis Hill, in Athens on Monday, July 11, 2011. (Petros Giannakouris/AP)

Globe editorial

The Canada-EU relationship seems to be prospering Add to ...

The eighth round of the free trade negotiations between Canada and the European Union has been completed, and the apparent progress toward the deepening of commercial relations between a huge community of 27 nation-states and another country with 10 provinces that all have a significant degree of autonomy is a remarkable accomplishment.

For the EU, this is the first time that it has attempted such a trade agreement with a developed country. For Canada, this is the first time that the provinces have been directly involved, rather than only being kept informed.

Robert Wolfe, a political scientist at Queen's University, points out that Ed Fast, the Minister of International Trade, was silent about intellectual property and agriculture in his statement about the negotiations on Friday, which suggests that these topics could yet be sticking points.

On the other hand, Lawrence Herman, an international trade lawyer at Cassels Brock LLP, plausibly conjectures that trade politics have "shifted in Canada's favour," because of a comparatively strong recovery from the recession and a rise in international respect for Canadian economic institutions. "Europe is in the doldrums and needs some good economic news," Mr. Herman says. "A trade deal with Canada would help."

If a good agreement is reached on government purchasing, that will be a real victory for free trade. Canada has recently suffered from procurement protectionism by U.S. states and municipalities, and Canada's provinces sometimes display similar propensities - most conspicuously, the preference for local content in Ontario's green energy policy, now the subject of a World Trade Organization complaint by Japan.

Consequently, the provinces' seeming co-operation on procurement in the EU negotiations is evidence of a welcome ability to overcome their own mercantilism - and welcome firmness on the European side of the table.

The EU's population of 500 million, compared with Canada's 34 million, makes one wonder whether this unwieldy, lopsided task is worth it for the Europeans. But if the negotiations succeed, it will not only be mutually beneficial but also a precious precedent for trade treaties among the advanced economies on a still larger scale.

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