Trudeau pushing free trade deal with EU at G20 summit in China

Concerns about the impact of protectionist sentiments on key Canadian trade talks led senior government members to dedicate some of their scarce face time to the issue Sunday with G20 peers.

With the two-day summit taking place after Britain's vote in June to exit the European Union and before the U.S. presidential election in November, observers expect G20 leaders to mount a defence of free trade and globalization and warn against isolationism.

Prime Minister Justin Trudeau himself was expected to discuss the subject when he met with European leaders on the margins of the G20 leaders' summit in China, International Trade Minister Chrystia Freeland said.

Freeland, who is also in Hangzhou, noted that growing movements against trade liberalization have complicated always-delicate talks with the United States on softwood lumber.

These attitudes, she added, have also affected Canada's push to sign a free trade deal with the European Union, also known as CETA.

"The prime minister is using his time here — it's very valuable, lots of European countries [are] of course members of the G20 — to push for CETA to get it over the finish line," said Freeland.

U.S. election complicating talks

Trade lawyer Larry Herman, of Herman and Associates, who is following the softwood trade talks said in an email Sunday that pockets of CETA opposition in various countries "seem to be gaining strength."

Herman said softwood talks have been further complicated by the fact the existing agreement expires Oct. 15 — right in the middle of the U.S. election campaign.

He believes Ottawa should work towards an extension until 2017, because finalizing a deal in the campaign would become politically charged.

• Speaking ahead of G20, Justin Trudeau urges leaders to fight protectionism
• Can I see your passport? Behind the scenes with Canada's delegation in China
• Alibaba's new online hub to help Canadian firms access huge Chinese market

​Canada's chief negotiator in the softwood talks recently said the two sides remain far apart on several key issues.

Freeland said she discussed the issue Sunday in Hangzhou with U.S. Trade Representative Michael Froman and expects to meet him again in about 10 days. She said the sides are engaged in detailed negotiations.

Trudeau calls for more trade

Trudeau, who took part in the official opening events Sunday with fellow G20 leaders, used the summit as a way to convey his message about the need for freer trade.

He warned a crowd at a G20-related event Saturday that isolationism does nothing to create economic growth.

Earlier Sunday, Trudeau held a bilateral meeting with President Idriss Deby Itno of Chad, chair of the African Union.

The leaders discussed deepening their countries' ties, security issues, women's rights and Canada's interest in engaging more in Africa, said a statement released by Trudeau's office.

Battle lines

Chinese President Xi Jinping also said the global economy is being threatened by rising protectionism and risks from highly leveraged financial markets at the opening of the G20 summit.

His warning on Sunday followed bilateral talks with Barack Obama that the U.S. president described as "extremely productive," but which failed to bring both sides closer on thornier topics such as tensions in the South China Sea.

The global economy has arrived "at a crucial juncture," Xi said, in the face of sluggish demand, volatile financial markets and feeble trade and investment.

"Growth drivers from the previous round of technological progress are gradually fading, while a new round of technological and industrial revolution has yet to gain momentum," he said.

G20 countries are set to agree in a communique at the end of the summit that all policy measures — including monetary, fiscal  and structural reforms — should be used to achieve solid and sustainable economic growth, Japanese Deputy Chief Cabinet Secretary Koichi Hagiuda said.

"Commitment will be made to utilizing all three policy tools of monetary and fiscal policies and structural reforms to achieve solid, sustainable, balanced and inclusive growth," Hagiuda told reporters on the sidelines of the summit.

Xi also called on G20 countries to match their words with actions.

"We should turn the G20 group into an action team, instead of a talk shop," he said.

But some of the G20 leaders have begun drawing battle lines in disputes over issues ranging from trade and investment to tax policy and industrial overcapacity.