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Statement by Deputy U.S. Trade Representative Michael Punke at the WTO Trade Policy Review of the European Union

Statement by Deputy U.S. Trade Representative Michael Punke at the WTO Trade Policy Review for the European Union

July 7, 2015
Geneva, Switzerland

Thank you, Chair.  The United States warmly welcomes Denis Redonnet and the entire delegation of the European Union to this review. 

Our economic relationship with the EU is immensely valuable to our economy, and is indeed a critical pillar of the global economy.  Our economies together account for nearly half of global GDP (46.5%) and 30% of global trade.  Each day, goods and services worth nearly $3 billion are traded across the Atlantic.  At the end of 2013, the value of our direct investment in each other’s economies totaled nearly $4.1 trillion.

These figures describe an international economic relationship that is, by any standard, an extraordinary success.  But we believe this relationship has not yet fulfilled its potential to promote growth in our own economies, and in the economies of many other Members that engage in significant trade with each of us.  That conviction prompted U.S. and EU leaders two years ago to launch negotiations on the Transatlantic Trade and Investment Partnership agreement, or T-TIP.  We will hold the tenth round of T-TIP negotiations next week in Brussels, and T-TIP remains a top priority of the United States and the EU.  President Obama and the leaders of the EU’s four G-7 member states in June reaffirmed their support for the conclusion of the negotiations on an expeditious timetable.

We believe – and we know our EU friends share this conviction – that the obligations we are seeking in T-TIP complement well our efforts in Geneva to work with the EU and other Members to strengthen the rules-based multilateral trading system.  We deeply appreciate our strong working relationship with the EU here at the WTO, particularly as we prepare for this year’s ministerial conference, and, we hope, a satisfactory conclusion to the DDA.  The EU is also an important partner in plurilateral negotiations, including the ITA expansion, EGA, and TiSA.  In these regards, the contributions of our friend Ambassador Pangratis – his creativity, eternal optimism, and excellent diplomacy – have been extraordinarily valuable, and we will miss him very much when he takes his leave soon.  Fortunately he is supported by a talented team that will remain in place.

As we noted during the EU’s last trade policy review, in 2013, much of our current trade with the EU proceeds without complication, unaffected by significant trade barriers.  We have concerns about EU policies in a number of areas, however, that we believe raise unjustified or unnecessary barriers to our trade and limit its potential in ways that we can change.  The EU and other Members will be familiar with our concerns from a wide variety of engagements in Geneva and in each other’s capitals. 

We expect that obligations on which we are seeking agreement in T-TIP will eliminate some of the barriers to our trade.  In parallel with the negotiations, we are also discussing existing measures that each side believes impede trade, and we have appreciated the efforts of the Commission’s Trade Directorate to coordinate those discussions and to try to make them as productive as possible.

Turning to some of our concerns with the EU’s trade policies, the United States continues to be disappointed by EU barriers to our agricultural exports.  High tariffs present a significant obstacle to the capacity of our producers to succeed in the important EU market.  When we launched the T-TIP negotiations, we jointly agreed to seek the complete removal of these tariff barriers. That remains the U.S. goal in T-TIP. 

Another of our most important trade policy priorities is to reduce and eliminate non-tariff barriers to our agricultural exports, including by ensuring that sanitary and phytosanitary measures are based on science.  A number of EU SPS measures are not supported by the scientific opinions of EU institutions, and are defended on grounds other than demonstrated risks to human or animal health or the environment.  Given the EU’s great importance in the global trading system, both as a commercial power and as a supporter of a rules-based system for regulating trade, we are concerned about the proliferation of trade restrictions that are based on factors other than the objective criteria offered by scientific assessments of risk, as required under the 20-year-old WTO SPS Agreement.  A recent example is the Commission’s proposal this past April to amend EU legislation on genetically-engineered food and feed products, a proposal that does not square with either the EU’s existing international obligations or its aspiration for a seamless internal market. 

Other non-tariff measures of the EU continue to pose significant barriers to U.S. exports.  As we regularly note in the WTO TBT Committee, the United States has broad concerns about EU policies and procedures to develop and implement technical regulations, standards, and conformity assessment procedures, as well as concerns about specific measures that affect U.S. exporters in a wide range of sectors, including chemicals and wine.  We also continue to be concerned about EU policies that result in the creation of third-country barriers to U.S. trade, such as requiring the EU’s FTA partners to eliminate “conflicting” standards, or making technical assistance contingent upon the elimination of such standards.

The United States also has significant concerns about the basic transparency of the EU’s regulatory process.  In particular, foreign actors are often precluded from giving meaningful input when the EU engages in rule-making.  It this sense, the EU is out of step with global best practices, and we hope to see changes in this area.

In addition, while we are encouraged that the EU has begun taking steps to reform its fisheries subsidies policies, we urge the EU to increase transparency and continue its efforts to reduce the level of subsidization of its fishing fleet, which may contribute to excess capacity and depletion of fish stocks.

The United States has addressed a number of other important issues in our written questions to the EU, including with regard to digital commerce, audio-visual services, and “geographical indications,” notably in the context of disappointing actions related to the Lisbon Agreement.  We will look forward to following up actively on the responses we receive.

In closing, the United States welcomes this opportunity to review EU trade policies and is hopeful that our exchanges will help us identify ways that those policies can help increase the benefits that many of us already derive from our trade with Member countries of the EU.