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Canada Meets The Walloons

Paul Magnette speaking at a UNCTAD round table
Paul Magnette, the current minister-president of Wallonia, speaking at a United Nations Conference on Trade and Development roundtable in 2012. Photo courtesy UNCTAD.

If Europe were more like Canada, I’d like Europe more.

You might be thinking that Europe and Canada already are quite a lot alike. I agree, at least compared to the differences between Europe and the United States. Canada shares a widespread social-democrat ethos with Europe; even Canadian conservatives are more liberal than their counterparts on our side of the border. Canada, like Europe, has significant differences between linguistic groups (though really just limited to French and English) and between regions (a relatively poor east and a much more prosperous central and west); the United States is more culturally homogeneous than either, even though we can often appear more fractious.

The major difference is that in Canada, things generally work. In Europe – specifically in the European Union – they generally don’t.

Case in point: A landmark new trade deal between Canada and the EU faces a serious snag because a single region – the French-speaking portion of Belgium known as Wallonia – rejected it. As long as Wallonia says no, Belgium’s national parliament cannot ratify the deal. And without unanimous ratification from all 28 member states (counting the United Kingdom, which has not yet formally triggered the departure process), the deal cannot go into full effect.

This is roughly the equivalent of giving the New York City Council veto power over proposed treaties entered into by the United States. It’s ridiculous. But it’s Europe.

The EU was supposed to make a final decision on the trade agreement this Tuesday, but postponed the decision until next week. While Wallonia is not the only region that has expressed reservations – Bulgaria and Romania have also previously voiced criticisms of the deal – the Francophone region is the wrench that has ground the EU’s gears to a halt. Belgium’s federal government, which favors the deal, is left to try to budge the Walloon leadership. Even Quebec, which is hardly known for favoring conformity, reached out directly to regional leaders to try to sway them in favor of the trade agreement.

Peter Ziga, Slovakia’s economy minister and the chair of the meeting between EU trade ministers, expressed frustration with the holdup. “If we don’t agree with Canada with whom will we agree?” he asked. Considering the linguistic and cultural ties between Canada and Europe, and Belgium in particular, the question is worth asking.

Measured by the standards that should be applied to trade deals – namely how much trade it will encourage – the Canada-EU pact known as Ceta is a winner. It aims to eliminate 98 percent of all tariffs between the two parties, while also applying environmental protections and opening government procurement across borders, which can only help ease taxpayer burdens.

Critics, however, offer the same objection to every trade deal: They see freer trade as a scenario consisting only of winners and losers, and they contend that the winners will always be a wealthy elite who prosper at the expense of the rest of society. If this sounds exactly like the way trade is being discussed (to put it very charitably) in our own presidential campaign right now, it is.

That such arguments are common, however, doesn’t make them right. Trade always ends up benefitting more people than it hurts, but in many cases the benefits for the individual consumer are small (think cheaper sofas) while the costs for individual workers or communities can be large (think local furniture factories shutting down). One side says nothing and barely notices; the other screams that trade deals are destroying the country.

And so it is in Wallonia, the poorer and more statist of Belgium’s two primary linguistic regions. Dutch-speakers make up most of the rest of the country, including Flanders, the large northern region that includes Brussels, which is both the country’s capital and EU headquarters. Wallonia is one of five regional governments representing these French and Dutch speakers, along with a handful of German-speaking Belgians in the country’s east.

In fact, Belgium itself is almost a microcosm of the EU. The country is an amalgam of culturally distinct regions, plus a city-state encompassing Brussels, a French-speaking island within Dutch-speaking Flanders. Getting nothing done is a Belgian art form, second only to chocolate-making. Not long ago the country managed to go about a year and a half without a government because the regions could not agree on one. Many government functions are simply duplicated, triplicated or worse to try to keep everyone satisfied.

Phillippe Moureaux, a former politician and current professor of economic history at the Universite libre de Bruxelles, suggested to Der Spiegel that Belgium’s history of occupation and disparate cultural histories have made its people indifferent to central authority. “A tradition here is to say: An authority? That will resolve itself,” he told the magazine.

Many observers, including some Belgians, had hoped that Belgium would absorb the spirit of the EU, back when that spirit was one of an “ever closer union.” Instead, Belgium’s internal disagreements threaten to derail a trade agreement for 27 other nations, too.

I will probably catch some flak from my Canadian friends for this, but as far as I am aware Canada’s chocolate just isn’t on a par with Europe’s. But in any other context, whether I am shopping for a steak or for a business partner, I prefer Canada over Europe, thank you. I wish the best of luck to Belgium and its EU comrades; they are going to need it.

Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s book, Looking Ahead: Life, Family, Wealth and Business After 55. His contributions include Chapter 1, “Looking Ahead When Youth Is Behind Us” and Chapter 4, “The Family Business."

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