Politico | 30 May 2016
EU and US trade sharp words on TTIP
By Ryan Heath
Tensions between the EU and U.S. over the lack of progress in talks on a transatlantic trade deal boiled over last week as both sides aired frustrations in sharply worded emails obtained by POLITICO.
The European Commission warned in an email sent Friday to the 28 EU ambassadors in Brussels that unless the U.S. changes its approach to negotiations on the Transatlantic Trade and Investment Partnership (TTIP), there’ll be no deal before President Barack Obama leaves office in January 2017.
In its email to EU permanent representatives, the Commission strongly criticized U.S. Ambassador to the EU Anthony Gardner for sending what it called a “somewhat unusual” message to his European counterparts earlier last week.
Gardner wrote to the 28 EU ambassadors on May 25, criticizing European Agriculture Commissioner Phil Hogan for making a “a series of misleading statements in the press,” while providing a detailed list of the statements.
The behind-the-scenes war of words is the latest sign of the increasingly fraught politics behind the TTIP talks, with each side digging on key policy areas and hinting that the other is not negotiating in good faith.
Agriculture is one of the most contentious of the 27 chapters currently under negotiation in the TTIP talks. Each side is under pressure from strong domestic lobbies.
In his email to the EU ambassadors, Gardner wrote, “While differences of opinion are natural, especially on tough issues like agriculture, they should be aired privately, rather than in the public arena.”
Gardner added that the U.S. position is that “EU tariffs are 2-3 times as high as U.S. tariffs and EU non-tariff barriers have virtually eliminated many of our key exports.”
In its counter-punch email, the Commission made clear it thinks the U.S. is unwilling to engage seriously in areas of importance for Europe, such as accepting its system of geographical indicators (which limit the use, for example, of the term “Champagne” to producers from specific regions).
The Commission blames the U.S. for the stalled negotiations, with the email saying “the EU has not yet seen substantial progress in areas of significant importance to EU agriculture, such as geographical indications, wine and non-tariff barriers.”
Sent from Hogan’s office, the content of the Commission’s rebuttal was agreed between several Commission departments and President Jean-Claude Juncker’s office was aware of it being sent to EU ambassadors, according to emails seen by POLITICO.
The email also implies that the Commission does not see a willingness on the part of U.S. to compromise on key issues. The message reads, “The U.S. Administration does not yet seem to be in a place where it can reciprocate the EU’s efforts in TTIP and to start delivering on matters of EU interest.”
A senior U.S. trade official told POLITICO the Obama administration is “worried about many recent developments on the EU side,” not limited to the TTIP negotiations, but extending to the EU’s unwillingness to re-approve the pesticide glyphosate.
According to an internal Commission briefing document shared with EU ambassadors, and obtained by POLITICO, Hogan rejected suggestions that current E.U.-U.S. agriculture trade is imbalanced.
“The EU exports processed, high value products, which cannot be easily substituted (because of consumer preferences) whereas US products are standardized commodities which are easily substitutable. The positive trade balance is essentially a result of the EU exports of wines and spirits and beer to the US.”
The Commission’s advice to the EU ambassadors even includes a note of sarcasm. At one point, the email notes that Hogan represents the collective view of the Commission, rather than his own opinions, and suggests this is “a point that seems to have been lost on the Ambassador [Gardner].”
Support for the TTIP issue, which had once been a seen as a potential trophy for EU-U.S. relations, is wavering in several key countries. French President Francois Hollande told the U.S. at the G7 summit Washington has to go “way further” to get his support for a TTIP agreement.
Germany’s Deputy Chancellor Sigmar Gabriel said Sunday that Angela Merkel would be wrong to push speed over quality in 2016 negotiations.