EU trade talks pushing hot buttons

Jul 16, 2013 By Rob Hotakainen, MCT Washington Bureau

WASHINGTON -- Hoping to win the largest trade deal in history, the president's new U.S. trade representative offered negotiators some advice as they launched new trade talks with the European Union this week.

"Be creative, be flexible, and think outside of the box as necessary to make progress," urged Michael Froman, who was sworn in last month and is charged with brokering an agreement.

But as negotiators prepare to end the first round of talks in Washington on Friday, many consumer groups in the United States and Europe fear their governments will be a little too flexible, rushing to help corporations cash in on billions of dollars in new business.

The biggest test facing negotiators will be getting the two parties to approve similar safety standards, overcoming the longstanding cultural differences separating them.

If the talks succeed, backers say, it will provide a huge economic boost to both the United States and Europe. But critics warn that it could come at a high price for American and European consumers, endangering laws that control everything from food to household chemicals.

"All signs are they will push for an agreement that locks in the lowest common denominator on both sides of the Atlantic," said Karen Hansen-Kuhn, international program director at the Institute for Agriculture and Trade Policy, a nonprofit research and advocacy group with offices in Minneapolis and Washington.

Froman, the deal's biggest cheerleader, said one of his biggest tasks will be getting Americans to understand how trade can produce jobs and raise living standards. He said he wants the United States wants to pursue "the most ambitious, most comprehensive agreement possible," one that could produce hundreds of billions of dollars of new U.S. exports. And he said he's confident that it can happen.

"There are longstanding historical differences, and we need to go into this with our eyes wide open," Froman said in a recent interview. "But for a number of reasons, we think there's an opportunity now to address some of these issues that have eluded us."

The oversight of chemicals promises to be a particularly hot topic, with many opponents worried that U.S. negotiators will try to scrap Europe's more aggressive regulatory system, which American companies call a "trade irritant."

Called the REACH (Registration, Evaluation, Authorization and Restriction of Chemicals) program, the system requires manufacturers to prove that chemicals are safe. The U.S. system is regarded as much more lax because it grandfathered thousands of chemicals in use before Congress passed the Toxic Substances Control Act in 1976, meaning they're assumed to be safe.

The talks on the proposed Transatlantic Trade and Investment Partnership promise to move slowly. They're not expected to wrap up until the end of next year at the earliest, and it won't come as much of a surprise if they're pushed into 2015. Froman said the substance of the talks will dictate when they end. But he noted that the terms of the current European Commission expire at the end of 2014; he said that will provide "a useful timetable" for negotiators.

As a result, no one expected any big developments during the first five days of negotiations.

Eric Shimp, a former U.S. trade negotiator who's now a policy adviser on global trade with Alston & Bird, a Washington law firm, called the first round of talks with the 28-member European Union "an elaborate exercise in jockeying for position."

"Even though it's the first round, it's really just the horses being put into the chutes," he said. "The gates aren't really open."

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