Berlin: EU should work closely with US on trade, climate, China

 Berlin: EU should work closely with US on trade, climate, China

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BERLIN • Germany wants Europe and the US to strengthen transatlantic ties with a trade deal abolishing industrial tariffs, reform by the World Trade Organisation (WTO) to increase pressure on China, and a joint carbon emission trading system to protect the climate.

Mr Peter Beyer, transatlantic coordinator for German Chancellor Angela Merkel’s government, told Reuters in an interview published on Monday that Germany and the new US administration under President Joe Biden should “think big” and aim for an ambitious agenda based on shared values and focused on joint interests.

“After the difficult years under Donald Trump, Germany and Europe now have a historic chance to breathe new life into the transatlantic partnership and improve relations with the US,” Mr Beyer said.

Mr Biden will have his first meeting with other leaders from the Group of Seven rich nations, including Dr Merkel, in a virtual event on Friday to discuss the coronavirus pandemic, the world economy and China relations.

However, German enthusiasm for a trade deal and stronger transatlantic ties may have to contend with a more cautious approach in France, where President Emmanuel Macron has made a priority of reducing European reliance on rival superpowers.

“We won’t wait for the United States to give Europe its sovereignty. It’s up to Europe to conquer it,” French Finance Minister Bruno Le Maire said when asked about the transatlantic relationship and reviving the idea of a trade deal.

Mr Beyer said that while Germany and the US would continue to have differences on issues like Russian gas imports, this should not stop them from liaising closely on economic, trade, tax and climate policies.

“Now is the right time to put a package of trade and economic policy proposals on the agenda. This must include a comprehensive and ambitious free trade deal,” said Mr Beyer, a member of Dr Merkel’s conservative party.

“It should include a common road map for a WTO reform that, among other things, finally gets China to play by international trade rules – violations of these rules must be sanctioned.”

As a first step towards rebuilding trust, Mr Beyer said, the new US administration should withdraw punitive tariffs unilaterally imposed by Mr Trump on European imports of aluminium and steel.

Talks on a European Union-US trade deal should start without preconditions from either side.

“And we should also abandon the maxim that there can only be an agreement once we have agreed on all areas. Instead, we should go step by step,” Mr Beyer said.

“The first step could be an agreement which would see the EU and US abolish all tariffs on industrial goods. Progress could be made quickly here. Controversial areas such as agriculture must then be discussed in a second step.”

As a medium-term goal, Europe and the US should strive for a transatlantic emissions trading system, which could be joined by other large industrialised countries. “That may sound utopian from today’s perspective, but if we don’t think big, we won’t get far,” Mr Beyer said.

REUTERS

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