New York Times: European Parliament Moves to Limit Scope of Eventual U.S. Trade Deal

Marietje
James Kanter, New York Times, 23.05.2013 The European Parliament passed a resolution on Thursday demanding that the free-trade pact now under discussion with the United States exempt “audiovisual” industries so that countries like France could shelter their movie businesses from foreign competition. The resolution, which also called for similar protections to be granted for online media, underlined the sensitivity in parts of Europe to the encroachment of American culture. It also represented a reality check for trade talks that in their early stages had generated enormous optimism but could still bog down in trans-Atlantic acrimony. “This vote shows the honeymoon phase is over,” said Marietje Schaake, a Dutch member of the European Parliament for the free-market D66 party. She was referring to the excitement that many trade advocates had felt since February, when President Barack Obama endorsed U.S. efforts to reach a trade deal with the European Union that would create a partnership between the biggest markets in the world. While the resolution is not binding on the Union’s governments, which still must agree on a mandate for the European Commission to begin negotiating with Washington, the vote was a signal that the Parliament was prepared to use newly acquired powers to block any eventual agreement with the United States that it disliked. And ultimately, the Parliament’s consent would be necessary as part of any final passage. Trade officials from various E.U. member states planned to meet in Brussels on Friday to discuss the mandate, which members of Parliament said Thursday that they expected to be approved by mid-June. A similar process is under way in the United States, where Congress is in a 90-day consulting period with the Obama administration. The British government immediately signaled frustration with the European Parliament for demanding so-called carve-outs, which could make bargaining more difficult for concessions in areas that the Americans consider sensitive. “We want to realize all the potential benefits of this deal for businesses and consumers,” a British government spokesman said, on condition that he not be named, as is customary. “That's why we believe that we should put all sectors on the table at the start of negotiations,” the spokesman said. The resolution that passed Thursday did broadly welcome the prospect of trade talks with the United States. But the inclusion of the paragraph about cultural industries that passed Thursday “summarizes how challenging it will be to reconcile the goal of raising growth by breaking down barriers with the tensions and political demands that crop up at the more local level,” said Ms. Schaake, who advocates a far-reaching deal between Europe and the United States. The resolution comes as European filmmakers and governments in countries like France seek the right to preserve state subsidies for filmmakers and maintain requirements that television and radio stations broadcast at least a minimum number of European programs. Karel De Gucht, the Union’s trade commissioner, has pledged in the trade talks to preserve the principle of cultural diversity, including allowing member states to set quotas for European movies and other cultural goods, and to subsidize European productions. But he has also repeatedly warned that full-scale exclusion of media, including digital media, from the talks could significantly narrow the scope of any eventual deal. “We are already streaming content without borders” and “we should also have the possibility to discuss about the audiovisual sector,” Mr. De Gucht said at a business conference in Brussels last week. “We should not carve out the audiovisual sector; it will be a mistake, and it’s also not good to start negotiations on the basis of carve-outs.” The vote, held at the European Parliament in Strasbourg, passed by a wide margin, with 460 votes in favor, 105 against and 28 abstentions. The resolution called for a comprehensive trade agreement and noted the many jobs that it could create, in principle at least. The lawmakers underlined some of their other priorities, including being kept “immediately and fully informed” at all stages of the talks. “Parliament has teeth and can bite,” said Vital Moreira, a Socialist member of the European Parliament from Portugal who prepared the resolution and steered it through the chamber. The United States and the Union, between them, already account for about half of global economic output and one-third of world trade. Bilateral trade in 2011 amounted to €455 billion, or about $588 billion, with a positive balance for the Union of more than €72 billion, according to the European Commission. The United States is the bloc’s main export market, buying €264 billion of goods, or about 17 percent of total E.U. exports, according to figures the commission issued in March. A free-trade deal with the United States could expand gross domestic product by 0.5 percent in the Union about a decade after the pact enters in force, the European Commission, the Union’s administrative arm, said in March. That would translate into an extra €545 a year for each family of four in the Union, the commission said. Mr. De Gucht said the same month that the deal would generate “hundreds of thousands of jobs.” Previous attempts to forge a trans-Atlantic free-trade deal have failed. And any new attempt at a pact faces huge obstacles — beyond the question of audiovisual restrictions — because some of the biggest gains would come not from the relatively easy goal of dropping tariffs but from removing restrictions like customs procedures that can and do create bureaucratic hurdles. The Union also wants to pry open so-called public procurement markets and scrap “Buy American” clauses that restrict the ability of European companies to sell goods and services to U.S. states and cities. The Europeans also have long complained about restrictions on foreign ownership of U.S. airlines. The Americans, in turn, are eager to see a reduction in barriers to exports of agricultural goods, including produce from genetically modified organisms and cloning, which many Europeans oppose. The talks also could run into difficulties over European initiatives like privacy restrictions on major online operators like Facebook and Google, and a tax on financial transactions aimed at recouping money from investment banks. Government officials and industrialists who support a trade pact have argued that things are different this time because Europe, in the throes of a recession and debt crisis, is seeking ways to accelerate growth without raising domestic spending. Proponents also maintain that the United States is eager to set global standards with Europe, to create a model that giant emerging economies like China might have no choice but to follow.