U.S. Reassures an Impatient Europe on Trade

DAVOS, Switzerland — President Barack Obama is committed to reaching an agreement to smooth trade with the European Union, the United States’ top negotiator has said, but only if it is constructed in a way that would overcome objections from farm groups and that could win congressional approval.

In an interview Saturday in Davos, Ron Kirk, the U.S. trade representative, responded to European leaders who in the past week renewed their calls for a U.S.-Europe deal to dismantle tariffs and other barriers, which they badly want as a way of stimulating their ailing economies.

At the World Economic Forum, David Cameron, the British prime minister, and Angela Merkel, the German chancellor, were among a host of leaders and business people pleading for a pact that would eliminate tariffs as well as regulations that impede trade. Even without changes, the United States and Europe between them already have the world’s largest trading market.

On both sides of the Atlantic, proponents of a deal have expressed frustration about the delaying of an official report by a U.S.-European working group that would set the stage for formal talks. The delay has fed the widespread perception that Mr. Obama does not care that much about a trade pact or, for that matter, about Europe in general.

“We greatly value the trans-Atlantic relationship,” Mr. Kirk said at a hotel in Davos. “We have devoted an extraordinary amount of time” to a possible trade agreement, he said. But the administration wants to make sure objections from farmers and other constituencies are addressed first, he said. Otherwise, officials might spend years negotiating an agreement only for Congress to reject it.

“If we do this, we want there to be a bridge to somewhere and we want to get there on one tank of gas,” Mr. Kirk said. He declined to predict when formal talks might begin.

Trade had been one of the main topics of discussion at the World Economic Forum, which concluded Saturday. There were signs of progress toward a trade accord, which, if it proved durable, could provide a riposte to the eternal criticism of the elite event: that the annual Davos forum is just an expensive cocktail party where little of substance is ever accomplished.

While it is true that Davos is rarely the venue for concrete agreements, the event attracts a diverse international crowd in an informal setting. It can be a place where political and business leaders work toward consensus on difficult issues like trade. That may have been the case in the past week, some of the people involved said.

“I’m carefully optimistic we will kick off negotiations this year,” Alexander Stubb, the Finnish minister for foreign affairs and trade, said after a panel on trade issues at the forum Saturday. “It’s going in the right direction.”

Noting that trade ministers from more than 20 nations were in town, Mr. Kirk said: “It’s a great opportunity to touch base with a number of them bilaterally. This saves me a trip to nine other countries.”

“Everybody criticizes Davos until they come,” Mr. Kirk said.

Friction-free commerce between the United States and Europe could create jobs and add an estimated $50 billion a year to the U.S. economy, Mr. Kirk said. European political leaders fervently want a deal to help their anemic economies grow. There is also strong support from business groups on both sides of the Atlantic.

“Half a dozen senior leaders in Europe are ready to move forward,” Thomas J. Donohue, president of the U.S. Chamber of Commerce, said in an interview in Davos on Thursday. He said that a deal could be concluded within 18 months if both sides set their minds to it.

But others are skeptical, noting that Europe and the United States have been talking on and off about a trade deal for years. While U.S. companies like General Electric have expressed strong support for an agreement, progress has always been stymied by objections from interest groups, particularly over agricultural issues. Some Europeans, for example, object to imports of U.S. food containing genetically modified plants.

Article source: http://www.nytimes.com/2013/01/28/business/global/us-reassures-an-impatient-europe-on-trade.html?partner=rss&emc=rss