Ambassador Punke: Statement at the Trade Policy Review of the European Union

 

 

Statement delivered by Ambassador Punke
Deputy U.S. Trade Representative and U.S. Permanent Representative to the World Trade Organization

 

As Delivered
July 6, 2011

Thank you, Chair.

We think it is appropriate to begin this Trade Policy Review (TPR) by noting both the value of our trade relationship with the EU and the important role that the EU plays in the multilateral trading system. Like many other WTO Members, the United States has benefitted greatly from its commercial relationship with the EU. Every day, a remarkable $2 billion in goods and services produced on one side of the Atlantic are delivered to the other side. U.S. and European companies have directly invested more than $1.5 trillion in each other’s economies – investment that supports millions of jobs on both sides. The prosperity and innovation spurred by these large trade and investment flows have helped the United States and Europe become major export markets for many countries around the world.

The United States and other WTO Members have also benefitted from the EU’s strong support, over many decades, for a rules-based multilateral trading system and for the steady reduction of barriers in successive rounds of multilateral trade negotiations. Finally, we are pleased to note that the vast majority of our bilateral trade with the EU proceeds without conflict, and that the disagreements that we sometimes have on certain bilateral or multilateral issues do not interfere with our extensive cooperation on other issues.

Because the EU plays such an important role both in international commerce and in the setting of global trade policy, we have an obligation to conduct a thorough and constructive review of its trade policies. The Secretariat’s analysis and the EU’s description of its trade regime provide essential input for this review. These documents – as well as the knowledge of EU trade policies that we have acquired through our engagement over many years – have prompted us to raise some questions about the consistency of certain EU policies with the EU’s stated commitment to open and transparent trade and WTO obligations.

Regrettably, we have concerns with EU trade and investment policies in several areas. I would like, briefly, to highlight several of these concerns.

With respect to agriculture, tariff protection continues to be high in the EU. Food and animal feed products that have been safely consumed in the United States for decades, and that the United States exports to dozens of other Members, continue to be excluded from the EU market by SPS measures that appear to lack sufficient scientific justification. For example, the EU has restricted the import and marketing of certain products of agricultural biotechnology, and forbidden the use on food of certain pathogen reduction treatments, that the EU’s own scientists have concluded pose no risk to human, animal, and plant life or health. Because of SPS and other barriers, U.S. agricultural exporters have been unable to take full advantage of the market access the EU offered in the Uruguay Round.

In the area of technical barriers to trade, WTO Members will recall from our TBT Committee interventions that we continue to have broad concerns about the EU’s policies and procedures to develop and to implement technical regulations, standards and conformity assessment, as well as concerns about specific measures that affect a wide range of U.S. exporters in selected sectors including chemicals and wine.

With respect to the EU’s overarching policies and procedures, we have found that by the time the EU issues public notices on regulatory proposals – some with enormous trade implications – internal deliberations among EU member states have progressed too far to allow for meaningful consideration of the views of trading partners. As we have for several years, we continue to urge the EU to offer WTO Members and their private sector stakeholders meaningful opportunities to comment on regulatory proposals, and assurances that those comments will be taken into consideration before final regulations are promulgated and enforced.

We have noted our concerns with the EU’s new common framework on accreditation, set out in Regulation 765/2008. We hope that in its responses, the EU will adequately address the issue of the consistency of its additional requirements in its framework on competition among accreditation bodies with the terms laid out in the ILAC and IFA mutual recognition arrangements. We also hope to learn more about how the EU will ensure consistent application across EU member states of criteria established under the Regulation to ensure continued acceptance of the results of conformity assessment from bodies accredited by ILAC and IAF signatories.

With respect to trade concerns in specific sectors, we have asked the EU to provide an update on outstanding issues in its response to our questions. In the chemical sector, we share the EU’s interest in protecting human health and the environment, but note that our trade-related concerns with implementation of REACH, such as the Only Representative and the monomers in polymers issues, have not been addressed. Similarly, we continue to voice trade concerns about the EU’s agenda to limit the use of so-called “traditional terms” such as tawny, ruby, classic, and chateau on wine labels.

Inconsistent implementation of internal market rules continues to constrain trade for EU and foreign producers alike. We applaud the European Commission’s efforts to eliminate lingering internal barriers to the free flow of goods, and look forward to hearing how the EU intends to address remaining barriers – including those that are not scientifically justified – to the free flow of goods at the EU and member state levels.

A recently issued study to the European Parliament entitled, “EU Subsidies for Polluting and Unsustainable Practices” contains a chapter devoted to fisheries subsidies. We welcome the efforts by the EU to reduce harmful subsidies to the sector, while also recognizing that more can and should be done. This study recommends curbing or phasing out potentially harmful subsidies, including those for operating costs, processing activities and price support; decreasing aid for individual fishing operations and vessel modification; and phasing out of fuel subsidies. We would be interested in hearing from the EU about the status of its reform of the Common Fisheries Policy and European Fisheries Fund, and the policy changes that are likely to develop for the post-2013 period. We hope that these reforms will include the further reduction and elimination of harmful fisheries subsidies and lead toward finding solutions to overfishing and overcapacity, including through the EU’s active and constructive participation in our negotiations to achieve an ambitious discipline on fisheries subsidies at the WTO.

We appreciate the EU’s strong commitment to the WTO and the Doha Round. We note that the EU states in its Report that “completing the Doha Round remains the EU’s top priority. The potential benefits are simply too important to be lost,” inasmuch as Doha represents “a potentially sizable boost to the world economy.” The United States welcomes the EU’s commitment to the Round, a commitment that we share. We agree with the EU statement, in its Report, that it is essential that all major players make a major contribution to the conclusion of the Round. We also appreciate the EU’s active participation in our collective challenge of assessing next steps in the Round, and trying to determine what is achievable in the short term.

We would like to thank the EU for providing answers to our written questions. We plan to review the responses carefully, provide substantive comments, and request clarifications as necessary during the course of this TPR.

I would like to note that the United States, as we have done for other TPRs, has refrained from asking excessive questions in multiple tranches during the course of the two week timeframe allowed for questions. We have, instead, asked the EU to address only matters that we consider particularly important and for which we are unable to obtain answers independently. We hope that others will consider following the same approach in the future for all Members’ TPRs.

In closing, the United States welcomes this opportunity to learn more about EU trade policies and practices. We are hopeful that our exchanges during this TPR will give the EU and its trading partners some guidance on ways that EU trade policy can be improved, expanding the benefits we have all gained from our trade with the countries of the European Union.

Thank you.