The European Union and the United States today strengthened transatlantic economic ties through a number of new initiatives. At the Transatlantic Economic Council (TEC), senior EU and U.S. leaders agreed to facilitate their customs procedures, to strengthen their cooperation on electric vehicle and smart grid research and in the fields of new technologies, such as cloud computing, and raw materials. The leaders also discussed a number of strategic economic questions, in particular transatlantic economic cooperation in the Southern Mediterranean and in emerging economies. Furthermore, the EU-U.S. Summit yesterday tasked the TEC to establish a new High-Level Working Group on Jobs and Growth to identify options to further enhance EU-U.S. economic relations.
Participants
The Transatlantic Economic Council was co-chaired by EU Trade Commissioner Karel De Gucht and U.S. Deputy National Security Advisor for International Economic Affairs Michael Froman. The European side was represented by Energy Commissioner Gunther Oettinger, Taxation and Customs Commissioner Algirdas Semeta and senior officials from a range of services and departments. The U.S. side was represented by United States Trade Representative Ron Kirk, Energy Secretary Steven Chu and Commerce Secretary John Bryson as well as a number of heads of agencies, including the head of the Office of Information and Regulatory Affairs (OIRA) Cass Sunstein and Margaret Hamburg, head of the U.S. Food and Drug Administration.
Participants reaffirmed the TEC's core objective to build a more closely integrated transatlantic marketplace, by strengthening trade and investment links. The TEC reviewed progress in creating new opportunities for jobs and growth through cooperation on regulation and innovation in key sectors.
Outcome
The EU and U.S. decided to develop joint approaches in a range of economic areas:
- Following yesterday's EU-U.S. Summit, the TEC launched a joint High-Level Working Group on Jobs and Growth, which will be co-chaired by U.S. Trade Representative Ron Kirk and EU Commissioner for Trade, Karel De Gucht. As set out by the Summit, the Working Group will identify and assess options for strengthening the U.S.-EU trade and investment relationship, especially in those areas with the highest potential to support jobs and growth. The Working Group will report its findings, conclusions and recommendations by the end of 2012, with an interim report in June 2012 on the status of this work.
- Mutual recognition of secure traders programs: The EU and the U.S. agreed to mutually recognize each others' "secure traders" programs. The EU's authorized economic operators' program, and its U.S. equivalent, allow security certified operators to benefit from quicker and simpler customs procedures. The mutual recognition decision will bring huge benefits for certified businesses and traders, when it will become operational in June 2012, in terms of reduced costs and time delays, less red tape, greater ease and predictability in the movement of their goods, and new trade opportunities. It will also allow customs on both sides of the Atlantic to focus their resources on real risks, thereby ensuring greater supply chain security.
- Electric vehicle and smart grid cooperation: Both sides agreed on a new work plan with the objective to develop coherent and compatible standards for electric vehicles and smart grids to promote these for adoption in relevant international fora. A "letter of intent" was signed today, announcing the establishment of two electric vehicle/smart grid interoperability centers, one at Argonne National Laboratories, in the U.S., and one at the European Commission's Joint Research Centre facilities in Ispra, Italy. These centers will promote a common approach between the U.S. and EU to testing of electric vehicle and smart grid equipment, with a view to the development of global standards. In addition, a number of transatlantic pilot projects were launched, related to the establishment of electric vehicle/smart grid interoperability centers and a "Twin city" project to test electrification of transport.
- New technologies: The TEC decided to intensify cooperation in a number of key emerging technologies and innovative sectors, such as nanotechnology and cloud computing. This work will bring together policy makers, regulators, and standard-setting bodies and aims at developing joint approaches to emerging regulatory issues and avoiding the creation of new and unintended barriers to trade and investment.
- Energy Efficiency: In the margins of the TEC, the EU and the U.S. initialed the Energy Star Agreement, a scheme initially established by the U.S. that promotes the manufacturing of energy-efficient office equipment. The Energy Star label enables consumers to identify low energy consumption appliances which play a part in ensuring security of energy supply and environmental protection.
- Information and Communication Technology: The EU and U.S. reviewed the Information and Communication Technology (ICT) trade related principles which were agreed earlier this year and discussed ways of promoting the implementation of these principles within their bilateral economic relationship and in their trade negotiations with third countries. (IP/11/402)
- Raw materials: The TEC agreed to develop trade policy strategies to eliminate barriers and to improve the investment and innovation climate by working together on trade policy issues, research and recycling.
- Small and medium-sized enterprises: Both sides will continue to strengthen their cooperation aimed at supporting the participation of small and medium-sized enterprises (SMEs) in international trade. The EU and the U.S. agreed on an Action Plan for 2012 based on the result of two very successful workshops conducted in 2011. Together they will look at measures to increase business and technology cooperation benefiting SMEs, to reduce transatlantic trade burdens including standards and intellectual property rights, and to apply best practices in entrepreneurship and access to finance.
- Investment: Participants agreed to intensify the ongoing cooperation in the field of investment, in particular with regards to strengthening joint approaches to barriers in third countries. This will help ensure that our large and highly integrated investment relationship continues to set the standard for open, transparent, and non-discriminatory international investment policies. Both the EU and the U.S. committed themselves to work on shared principles for international investment to be completed by early 2012.
- Regulatory cooperation: The TEC also furthered the work on regulatory principles on which both sides have agreed in June this year. The participants welcomed in particular the adoption of a "Common Understanding on Regulatory Principles and Best Practices" as well as a joint understanding on "Building Bridges between the U.S. and the EU standards system." This document on standards is meant to create new mechanisms to promote cooperation, collaboration, and coherence in standardization.
Background
The TEC was set up in 2007 to guide and stimulate transatlantic economic convergence. It is currently co-chaired by Commissioner Karel De Gucht and U.S. Deputy National Security Advisor for International Economic Affairs Michael Froman. The regulatory work of the TEC focuses on economically relevant issues of mutual interest, in order to identify issues where EU-U.S. cooperation could produce results in a reasonable time horizon and to engage in a strategic discussion on selected global economic issues.
The TEC is currently the only EU-U.S. high-level forum in which economic issues can be discussed in a coherent and coordinated manner. It brings together a wide range of ongoing economic cooperation activities and is a platform which can give political guidance and direction. At the same time, the TEC is a political forum where participants can explore joint approaches to strategic global economic questions.
At the EU-U.S. Summit in Lisbon in November 2010, leaders tasked the Transatlantic Economic Council to strengthen transatlantic economic ties by promoting innovation, streamlining regulations and eliminating barriers to trade and investment. Leaders particularly underlined the central role of the TEC in generating new opportunities for jobs and growth, particularly in key emerging sectors and technologies, as well as its strategic role in strengthening our economies for the competitive challenges of the future. Based on this mandate, the TEC put in place a new approach, focusing the work on a forward-looking result-oriented regulatory cooperation agenda and a strengthened cooperation on strategic global economic questions.
The last meeting of the TEC was held in December 2010.
Trade and Investment Relations
The European Union and the United States have the largest bilateral trade relationship in the world. The EU and the U.S. economies account together for about half the entire world GDP and for nearly a third of world trade flows.
For goods and services, we are mutually our biggest trading partners, with 16 percent of total EU trade being done with the U.S., and 20 percent of total U.S. trade being done with the EU. This amounts to a total annual trade of goods and services of 667 billion euros, or 1.8 billion euros per day. Latest trends in goods trade for the first three quarters of 2011 are largely positive, with more than 20 percent increase in the first quarter on a year-on-year basis. The third quarter showed a quasi-stagnation of EU imports (+0.6 percent) and a contraction of EU exports to the U.S. (-2.1 percent). The strength of EU-U.S. relations can also be illustrated with approximately 15 million jobs linked to the transatlantic economy.
The EU and the U.S. enjoy the most integrated economic relationship in the world, illustrated by unrivaled levels of mutual investment stocks, reaching over 2.1 trillion euros. Total U.S. investment in the EU is three times higher than in all of Asia and EU investment in the U.S. is around eight times the amount of EU investment in India and China together.
Further Information:
On EU trade relations with U.S.:
http://ec.europa.eu/trade/creating-opportunities/bilateral-relations/countries/united-states/
On the EU-U.S. Summit, November 28, 2011: IP/11/1457
Last Transatlantic Economic Council, December 18, 2010: Fact sheet
