Newspaper article International Herald Tribune

With Spying Aside, Tough Issues Persist in Trade Talks

Newspaper article International Herald Tribune

With Spying Aside, Tough Issues Persist in Trade Talks

Article excerpt

Big snags face the hammering out of a trade deal between the European Union and the United States.

Negotiations on what could become the largest-ever free-trade deal, one encompassing nearly half of global economic output, started formally here on Monday between the United States and the European Union, as each side temporarily put aside any differences over the revelation of American surveillance of European offices.

European officials have called the potential agreement a "once- in-a-generation prize," with the prospect of adding hundreds of billions of dollars in yearly growth, and thousands of jobs, to the still-lagging European and U.S. economies.

But big deals come with big stakes, and analysts say they expect months of intense negotiations as European and American officials rush to complete a comprehensive agreement -- under the title of the Transatlantic Trade and Investment Partnership -- before a deadline of the end of 2014.

Corporate interests and individual countries have started maneuvering in efforts to broker special carve-outs, exclusions or inclusions. Negotiations over sensitive areas like agricultural policy, airline rights, data privacy and intellectual property are bound to face serious headwinds.

Michael Froman, the U.S. trade representative, urged those taking part in the talks here to "think outside of the box as necessary to make progress."

He said both sides were entering the talks "with eyes wide open" but with the knowledge that "there is strong political will at the highest levels on both sides of the Atlantic determined to stay focused and get this done on one tank of gas."

The revelation that the United States' National Security Agency has been secretly tracking European offices in Washington overshadowed the start of the talks, however.

Several European leaders expressed outrage at the report of such bugging, based on information supplied by the former government contractor Edward J. Snowden, who remains in legal limbo in a Moscow airport.

France, in a show of deep discontent, had called for postponement of the trade talks. Chancellor Angela Merkel of Germany criticized what she said were the "Cold War" tactics of American espionage agencies.

The European Parliament voted to launch an investigation, and parallel negotiations on security and surveillance concerns began Monday as well, covering "data protection and privacy rights of E.U. citizens," European officials said in a statement.

But the advanced and closely interlinked economies on either side of the Atlantic both desperately need a shot in the arm, still suffering from low growth rates and high unemployment in the wake of the recession.

Indeed, the International Monetary Fund sees the euro-zone economy contracting again this year, with the broader European Union scarcely growing. The outlook is better in the United States, but not much.

The fund sees growth of about 1.9 percent. …

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