Steeling the E.U.-U.S. Relationship for the Challenges Ahead
Summary of a luncheon address by Pascal Lamy, European Commissioner for Trade, sponsored by the West European Studies Program, the Project on America and the Global Economy, and EUROPE magazine
Speaking at a Wilson Center luncheon sponsored jointly by EUROPE magazine and the Center's West European Studies Program and the Project on America and the Global Economy, Pascal Lamy gave a comprehensive overview of key multilateral as well as E.U.-U.S. bilateral trade negotiations.
Meeting late last year in Doha, Qatar, the members of the World Trade Organization (WTO) agreed to launch a new round of multilateral trade negotiations. Lamy noted that the Doha Development Agenda (DDA) would allow WTO members to continue their traditional work on market opening as well as making progress on topics such as trade facilitation, government procurement, investment and competition.
Lamy saw the DDA marking a new era for the WTO. In the future, the South as well as the North will be at the table when forging future trade agreements. As part of a broader approach to global integration, the DDA will help provide technical assistance and support so that new, developing country members of the WTO can fully participate in trade negotiations and in the benefits of global trade. In Lamy's view, Doha "is the first step on a through train, heading next to Monterrey for the conference on financing foreign development, and on to Johannesburg to address sustainability".
Lamy also detailed his view of a fundamentally strong E.U.-U.S. trade relationship that is nonetheless troubled by a series of current and potential trade disputes. He mentioned a number of disputes where the U.S. will have to bring itself into compliance with WTO findings. The current focus is on the WTO ruling that the 2000 U.S. legislative substitute for the Foreign Sales Corporation is still a prohibited export subsidy. He also recognized the ongoing U.S. frustration over E.U. treatment of beef hormones and genetically modified organisms (GMOs). Lamy stressed the desire of the European Union to work with the U.S. to find a solution to the FSC and other outstanding disputes but cautioned against the idea that the European Union would not retaliate in the face of continuing U.S. violations.
Lamy also spoke of a possible future dispute over the U.S. treatment of steel imports. Lamy argued that excess U.S. capacity and the impact of legacy costs (pension and health care costs for retired workers) were the principal problems for U.S. steel producers, not imports. Instead of unilateral U.S. action, Lamy urged a multilateral agreement that would include a reduction in worldwide capacity.
Lamy concluded his remarks by emphasizing the positive nature of the E.U.-U.S. trade relationship and the importance of continued U.S. involvement: "Without the U.S. playing an active and positive role," he said, "the multilateral system will lose its way."