EU-U.S. TRADE NEGOTIATIONS

European Union Member States gave the Commission the green light to start formal negotiations with the U.S. on two agreements, one on conformity assessment, and the other on eliminating tariffs on industrial products.

The directives for the negotiations cover two potential agreements with the U.S.:

• A trade agreement strictly focused on industrial goods, excluding agricultural products;
• A second agreement, on conformity assessment to make it easier for companies to prove their products meet technical requirements on both sides of the Atlantic.

In line with the directives agreed by EU governments, the Commission will further examine the potential economic, environmental and social impacts of the agreement, taking into account the commitments of the EU in international agreements, including the Paris Agreement on climate change. This assessment, as well as the negotiating process itself, will be conducted in regular dialogue with the European Parliament, Member States, civil society and all relevant stakeholders, in line with the European Commission's commitment to transparency. As part of its engagement for an inclusive trade policy, the Commission is currently running a public consultation on voluntary regulatory cooperation.

An economic analysis undertaken by the European Commission already indicates that an EU-U.S. agreement on eliminating tariffs on industrial goods would increase EU exports to the U.S. by 8% and U.S. exports to the EU by 9% by 2033. This corresponds to additional gains of €27 billion and €26 billion in EU and U.S. exports respectively.

Note:

Europe is ready to resume talks with the United States about a transatlantic trade deal. But they may already be doomed. Disagreement over agriculture could derail talks before they even start. The European Union says agriculture won't be up for discussion, while the United States insists it must be part of negotiations. The divisions underscore the difficulty of the task facing negotiators, and the complicated history of trade talks between the United States and Europe. France voted against opening trade talks , but was overruled by a majority of EU member states. While France couldn't prevent the start of trade discussions with the United States, it can block any deal that results. All EU member states must sign off on trade deals negotiated by the bloc. This fight will have to continue, particularly in the European Parliament, without which no trade agreement can be approved after the negotiations.

The United States and the European Union are already at loggerheads over whether agriculture should be included in trade discussions. The European Union is very protective of its heavily-subsidized agricultural sector. The United States, meanwhile, wants to break down tariffs and sell farm products in Europe. It's a highly emotional issue in many parts of the Europe, where voters fear that a trade deal with the United States would open their doors to genetically modified crops or chicken washed with chlorine. The United States insists that if Europe wants a deal, it has to include agriculture. Meanwhile, EU officials argue that agriculture has never been on the table. When European Commission President Jean-Claude Juncker visited the White House last year, they point out, he and Trump only agreed to work toward eliminating tariffs and barriers on "non-auto industrial goods. The joint statement issued by the two leaders at the time made no mention of agriculture.