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Trade Secrets – Draft EU documents reveal trade agenda with U.S

Article by Karen Hansen Kuhn, published on http://www.iatp.org/ on July 3, 2013

Transparency and trade negotiations don’t seem to go together these days. Recent revelations in Spiegel disclosed that the U.S. government had been spying on its EU “partners” connected to negotiations on the Transatlantic Trade and Investment Partnership (TTIP, probably better stated as the Trans Atlantic Free Trade agreement, or TAFTA, which very much rhymes with NAFTA). The French and German governments are outraged, with some parliamentarians calling for a suspension of the talks, slated to start next week in Washington, D.C.

Unfortunately, the only way civil society groups find out about the negotiations are through basically one-way conversations, where we express our concerns to trade officials, or through leaked negotiating documents. One such text came our way over the weekend, a set of position papers summarizing some of the EU’s initial goals on regulatory harmonization, which would be sent to the U.S. ahead of the talks. It includes initial proposals on regulatory issues involving the automotive sector, chemicals, pharmaceuticals, Sanitary and Phytosanitary issues (SPS), competition policy, a proposal for a chapter on trade and sustainable development, trade in raw materials and energy, and an ambitious proposal for cross-cutting disciplines on regulatory issues. It starts out by asserting that, “the TTIP offers a unique chance to give new momentum to the development and implementation of international regulations and standards (multilateral or otherwise plurilateral). This should reduce the risk of countries resorting to unilateral and purely national solutions, leading to regulatory segmentation that could have an adverse effect on international trade and investment.”

Consistent multilateral rules on difficult issues make sense, but let’s make sure trade is put in its place. Rules that provide for a safe workplace, protect public health and the environment, and promote energy and food security have been lost in trade agreements of the past. And the fact is that many advances in standards start at the local level and work their way to the national and, ideally, international levels. The recent votes for GMO labeling in Connecticut and Maine are a good example of this. To be fair, the proposal highlights the “importance of regulatory action to achieve public policy objectives” and states that it should not be used to lower standards in either country. But many regulations on difficult issues such as GMOs, questionable food additives like ractopamine, and emerging technologies such as engineered nano materials in food, need extensive public debate with a bias towards raising standards. The paper proposes steps to increase cooperation among regulatory authorities on both sides of the Atlantic, but makes no mention of public participation in that process. Sadly, the precautionary principle, which is the basis of EU law on many of these issues and is enshrined in the Treaty of Lisbon, is entirely absent from the document.

The document also includes a first informal discussion draft, a “non paper,” on public procurement. The EU has expressed its intention in other fora to include procurement commitments at all levels, i.e., including state and municipal governments. That goal is repeated here, along with the aspiration to include procurement commitments in all goods and all sectors. This could mean that programs that support local and sustainable foods, like local farm to school programs, could be on the table in the trade talks. The U.S. has excluded procurement commitments on food from other trade agreements, but it seems that this, along with possible commitments on living wage laws and Buy America programs, could be up for grabs.

Taken together, this agreement and the Trans Pacific Partnership (TPP) would regulate a vast share of global trade. They would undoubtedly set the standards for rules in other bilateral or regional agreements too, and could eventually circle back to set the rules at the WTO. And they matter because, especially in the case of TAFTA, they are not so much about trade in goods and services per se, but about “regulatory cooperation.” That term means a lot of things in different sectors. In our food system, it has the potential to set public health and environmental standards at the lowest possible level in order to resolve pesky “trade irritants” like food safety laws and regulations on new food technologies and questionable food additives.

The new GMO labeling laws, public preference programs for local foods and countless local environmental rules were developed in the light of day and through a vigorous public debate. Unfortunately, the Obama Administration has so far shown little inclination to take the trade talks out of the shadows, either during the talks or when the resulting deals go to Congress. Despite leading secret negotiations, it is expected to push for Fast Track negotiating authority this summer, which would limit Congress to an up or down vote on any trade deal (with no amendments) and put strict limits on debate.

In the wake of the spying scandal, EU trade officials are calling for greater transparency in the trade talks, especially on just what information the US obtained. Officials on both sides of the Atlantic should commit to open the talks, and listen to proposals on fair trade and better food systems. Some 34 civil society groups from the U.S. and EU issued this letter last week, calling on trade negotiators to negotiate higher standards or abandon the talks. Other calls for transparency and against unfair provisions on investment, intellectual property rights and energy exports are on the way. That is what really should be on the agenda next week in D.C.

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No to a corporate driven agreement!

8 July, 2013 – Remained unheard the demands to stop the negotiations, which arose after the scandal of the spying activities of the NSA on European representatives, the first round of negotiations of the Transatlantic Trade and Investment Agreement (TTIP, aka TAFTA) is starting today, Monday 8th July in Washington, DC. With an open letter to President Obama, EU Commission President Barroso and EU Council President Van Rompuy, more than 60 organisations from Europe and the US have raised their voice. The letter shows their concerns about the coming negotiations and state their opposition to the use of behind-closed-door trade negotiations to change and lower public interest measures for the sake of commercial interests (Read or download the letter and the list of signing organisations)

U.S. and UK want financial services as part of trade pact

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.

He was speaking during an event at the National Foreign Trade Council, a U.S.-based business group.

EU financial services chief Michel Barnier has also come out in favor of the move, a spokeswoman for the bloc said.

A Treasury Department official said, “The United States will seek to obtain improved market access for services on a comprehensive basis, including for financial services.”

Finding common ground on regulatory and market access issues could encourage banks and insurers to expand across the Atlantic instead of moving to other parts of the world.

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.

Thornier problems would have to be dealt with separately, the diplomat said, such as derivatives regulation and the challenge of “too big to fail” banks.

The White House formally notified Congress in March of its plan to negotiate a comprehensive trade and investment agreement with the EU.

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.

Talks on the free-trade pact are expected to begin in July, although no dates have been announced.

Britain hopes the Group of Eight summit meeting in Northern Ireland in June can help set the stage.

“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)

France threatens US trade veto over culture

Article written by Benjamin Fox and published by www.euobserver.com

BRUSSELS – The French government has dismissed as “naive” suggestions that a transatlantic trade deal with the US could substantially benefit the EU economy and take it out of crisis.

Speaking on Thursday (18 April) following a meeting of EU trade ministers to discuss the draft negotiating mandate, French trade minister Nicole Bricq said “it would be naive to think that the discussions, which will be long and difficult … will really save Europe from the current anaemia.”

EU ministers are expected to sign off on the commission’s negotiating mandate in mid-June. The talks are then expected to take up to two years, although trade commissioner Karel de Gucht is hoping to strike a deal in time for next May’s European elections.

Bricq also said that Paris would insist on the exclusion of Europe’s audiovisual sector from the talks.

“The position of France is that we want exclusion from discussion of cultural items. This is non-negotiable. It is not a surprise. I have said it and if we don’t have exclusion, we will have no agreement,” she said.

The French demands – with the traditional focus on cultural issues – indicate the delicate balance EU negotiators will need to strike to broker a deal. Officials and other EU governments are concerned that keeping certain sectors away from talks could encourage the US to draft its own ‘red lines’.

Irish business and employment minister, John Bruton, who chaired the meeting, struck a more optimistic tone. Ministers had made “real progress towards achieving an agreement,” he said.

De Gucht and Mike Froman, International trade advisor to Barack Obama, were also present at Thursday’s talks. Froman’s presence marks the first time that a US government representative has discussed EU-US trade policy directly with trade ministers.

Officials in Brussels have been talking up the Transatlantic Trade and Investment Partnership with the US which they say could be worth as much as 0.5 per cent of EU GDP and create 400,000 jobs.

A recent paper by the Centre for Economic Policy Research (CEPR), a London-based think tank, indicating that a US trade deal could increase EU economic output by up to €119 billion a year, the equivalent of €545 a year for the average family of four.

But failure to go beyond agreement on tariff barriers would lead to economic gains of no more than €23.7 billion, according to the CEPR. Liberalising the services market and public procurement rules would be worth an additional €5.3 billion and €6.4 billion.

EU-US Draft Mandate for the TTIP

Following its practice of untransparence in trade and investment issues, last 13 March the EU Commission adopdet a “restraint” Recommendation for a Council Decision authorising the opening of negotiations on a comprehensive trade and investment agreement, called the Transatlantic Trade and Investment Partnership, between the European Union and the United States of America. The online magazine Inside US Trade published this draft mandate  on 28 March 2013.

Obama Expresses Guarded Optimism On U.S.-EU Trade Deal, But Sees No Guarantee

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.