US/EU : A transatlantic free trade zone ?

**Voland** · 02-13-2013

US president Obama has called for talks on the establishment of a transatlantic free trade zone between the US and the 27 nations of the EU, that would include almost half the worlds economic output, and unite the US in a trade bloc with at least four G8 economies, Germany, France, Britain and Italy (along with the smaller ones).
Talks on the issue have been started and scrapped more than once in recent years, in 2007 and in 2011 as well. The crucial issues weren´t actually tariffs ( that are low anyway), but regulatory barriers, such as the EU ban on genetically modified foods or subsidies for Airbus vs. subsidies for Boeing. On the european side ( out of the major economies) the export-hungry and competition experienced Germans have already thrown their weight behind it, and have already in the past, and also Britain has expressed support, France under Hollande is much less enthusiastic about the idea though, and Italys leadership after its upcoming elections is too unclear to make predictions. And also on the US side the response to Obamas speech was apparently mixed, not least by senators from states that fear competition for their key industries. The US chamber of commerce has rather lauded the opportunities and the growth potential of the idea. It has also been registered however that in the same speech Obama has also called for a transpacific free trade zone, including Japan, Australia and Canada. The major economy notably absent from both his visions is China, and that seems to be the real recipient of the message

:

UPDATE 2-Obama calls for U.S. free trade pact with European Union | Reuters

http://www.spiegel.de/international/...-a-883104.html

**Voland** · 02-13-2013

The EU Commission has confirmed that negotiations on a EU/US free trade zone will take off in June. In charge on the EU side will be trade commisioner Karel van Gucht (Belgium), since trade policy is part of the Unions competences. Any agreement will have to be ratified by all 27 national parliaments and the EU parliament as well, that is one reason why van Gucht estimates the necessary timeframe to be not less than two years.........

**JMorcan** · 02-18-2013

The U.S. economy has been devastated by free trade with the largest Third World country in history. Now Obama would suggest that free trade with less affluent nations in the crumbling EU will somehow reverse the trend. This is lunacy of the highest order.

**Voland** · 02-19-2013

Originally Posted by JMorcan

The U.S. economy has been devastated by free trade with the largest Third World country in history. Now Obama would suggest that free trade with less affluent nations in the crumbling EU will somehow reverse the trend. This is lunacy of the highest order.

Oh, well, we´ve been the recipient of doom messages, how much we were "on the edge", "crumbling", "on the brink of desaster", "collapsing" etc, because of austerity, debt, social programs, lack of finance engineering, etc. at least since 2008 ( must be dissappointing if an anticipated desaster just fails and fails to materialize, right ?). Fact of the matter is that five out of 27 countries in the EU are commonly reffered to as being in crisis (Spain, Portugal, Greece, Italy and Ireland), while others prosper ( Germany, Nordics f.e.). Fact of the matter is also that the allegedly "crumbling" EU is surprisingly able to push major and painful reforms that the US has not even been seriously discussing ( you chose to raise the debt ceiling instead, congratulations for managing after a bit of turmoil). That in spite of all moneyprinting and quantitative easing orgies the US have not been able to engineer a post 2008 recovery on the level of the Northern Europeans ( in spite of their allegedly "harmful austerity", the question is who you want to compare yourself with, Greece or Germany ?), that the US have a trade and budget deficit worse than the worst performing members of the Eurozone, and that even in the worst performing countries voters have always and time and time again elected pro-european leaders and parties. So are we "crumbling" ? Don´t hold your breath. But better come up with intelligent ideas to solve your own problems, including your trade deficit, for which the free trade zone is supposed to help ( US and EU together account for about 50 % of trade worldwide. Where is the "lunacy" ?) and while the EU is on an open-ended and difficult reform course with many obstacles that may also derail it, the US have not even begun. Which should not be confused with being in a better position. Good luck.
It looks by the way, as if France and the Southern Europeans are not so keen on the idea anyway, and seek to derail it :

Southern EU States Want Exemptions From US-EU Free Trade Talks - SPIEGEL ONLINE

**JMorcan** · 02-19-2013

Clinton promised American citizens that NAFTA and China's entry to WTO would increase exports and create jobs. He must have made that speech while visiting Beijing. In any event, the result of free trade with the EU will be the same, and every right-thinking American should hope this initiative fails as quickly as possible.