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By Doug Palmer and Douwe Miedema – WASHINGTON | Thu Apr 18, 2013 8:15pm EDT
(Reuters) – The United States and the UK aim to include financial services in a proposed free-trade agreement between Washington and the 27-nation European Union, the British ambassador to the United States said on Thursday.
The accord would aim to smooth out regulatory differences that have stunted U.S.-EU trade in areas such as agriculture, chemicals, pharmaceuticals and autos. The EU is already the largest U.S. trading partner.
“We are pretty keen, pretty clear, that as the owners of the two most significant international financial centers, on either side of the Atlantic … that we would both like to see financial services covered by these negotiations,” said Peter Westmacott, the UK ambassador to the United States.
The agreement would likely address issues such as what percentage of people on the board of a foreign bank need to be U.S. citizens, and what stake foreign banks can hold in U.S. financial institutions, another UK diplomat said.
That letter outlined the administration’s desire to negotiate new market openings for U.S. services companies and to improve regulatory cooperation across the Atlantic. It did not specifically mention financial services sectors such as banking or insurance.
But working groups from the U.S.-EU business coalition are already looking at market access barriers and regulatory issues related to insurers and banks and considering comments from companies, a U.S. business official said.
“We think it might be sensible drawing the world’s attention to the importance of (the trade pact) before, during or after the G8 summit … that might be a good time to get it all going,” Westmacott said.
(Reporting by Doug Palmer and Douwe Miedema, writing by Anna Yukhananov; Editing by Xavier Briand and Peter Cooney)
Article from Inside Trade, 12 March 2013 – President Obama today (March 12) said he was “modestly optimistic” that the U.S. and European Union can successfully conclude a trade deal but emphasized that there is no guarantee it can be done.
“There is no guarantee that in the end some of the countries that have been hard cases in the past won’t block [a trade agreement] again, but I think that you’re going to see more pressure from more countries on the other side of the Atlantic to get this done than we have seen in the past,” Obama told the President’s Export Council (PEC).
This internal pushback in the EU is one of three reasons that Obama cited for why a deal is possible when it has not been in the past.
The second reason he cited is a recognition throughout Europe that it is hard for them to find a recipe for growth in an era of austerity measures. “So I think they are hungrier for a deal than they have been in the past,” Obama said.
The third reason he cited is the fact that the two sides have already made progress on resolving some difficult issues., “thanks to the work of good people like [Deputy National Security Adviser] Mike Froman.”
“We’ve identified on the regulatory side, customs side, areas where we can synchronize without hurting either side, but simply lubricating more effective trade between the two countries,” Obama said. Nevertheless, he said, the negotiations will still be “a heavy slog.”
In the past, the EU had to pursue agreements that were lowest common denominator given the differences among its member states, Obama said. “There are certain countries whose agricultural sector is very strong, who tended to block at critical junctures the kinds of broad-based trade agreements that would make it a good deal for us,” he said.
He made clear that it is unacceptable for the U.S. to keep agriculture out of the agreement. “If one of the areas where we’ve got the greatest comparative advantage is cordoned off from an overall trade deal, it’s very hard to get something going,” he said.
Obama laid out the benefits of completing an agreement with the EU, particularly in the regulatory area, saying an agreement could expand trade with Europe substantially. He called on business and labor to support these efforts.
“In order for us to do this, we’re going to need the help of industry and labor and all the parties that are represented here [at the PEC],” he said.
The president also highlighted the importance of the ongoing Trans-Pacific Partnership negotiations, once again touting it as a high standards agreement that would set the bar for ensuring that trade is fair.
“And for those of us who abide by high labor standards and high environmental standards, obviously being able to lock in those kinds of high standards in the fastest-growing region of the world and the most populous region of the world can yield enormous benefits and help to generate billions of dollars in trade and millions of jobs,” Obama said.
He said that exports and trade are “one brick in the broader economic foundation that we’re trying to build.”
The president’s appearance coincided with the European Commission approving a draft negotiating mandate and sending it to the member states for approval in the hopes that the negotiations will begin before summer break.