German Vice Chancellor Warns on Trans-Atlantic Trade Talks -- Update
August 28 2016 - 5:51PM
Dow Jones News
By Tom Fairless and Zeke Turner
BERLIN -- Germany's Vice Chancellor Sigmar Gabriel warned that
negotiations to build a vast trans-Atlantic free-trade zone have
failed, casting fresh doubt on a sweeping deal that has faced
growing criticism as anti-globalization sentiment gained traction
on both sides of the Atlantic.
"From where I'm sitting, the negotiations with the Americans
have failed. Just nobody says that," Mr. Gabriel said Sunday during
an appearance at a summer open-house event organized by the German
government.
The EU and U.S. have been rushing to complete negotiations for
the world's largest free-trade zone before the Obama administration
leaves office in January. The deal, which would encompass around
800 million consumers, aims to eliminate most tariffs and harmonize
regulations in areas ranging from environmental rules to food
safety.
Brussels and Washington have been negotiating the Trans-Atlantic
Trade and Investment Partnership, or TTIP, since 2013, and both
sides still say they hope to conclude it by year-end.
But the deal has faced an unprecedented backlash in Germany,
where hundreds of thousands of people have taken to the streets
across the country to protest. Opponents, which include trade
unions and environmental groups, say the agreement is
anti-democratic and could harm environmental and food safety
standards.
Meanwhile Britain's vote to leave the EU removes one of the
bloc's strongest trade advocates in Europe, as the U.K. frequently
acts as a counterweight to some of the bloc's more protectionist
countries.
Members of Mr. Gabriel's center-left party spoke out last month
to say the negotiations were dead in the water. France's Prime
Minister Manuel Valls warned earlier this year that the proposed
pact would serve as "a breeding ground for populism."
Chancellor Angela Merkel, a full-throated advocate of the deal
from the start, has said she would like the negotiations to be
completed before the Germany's federal elections next year.
But those elections, as well as French presidential elections in
May, are set to complicate the progress of the deal further.
Britain's expected departure from the EU also makes a deal less
interesting for the U.S. given the U.K. is America's largest
trading partner in Europe, as measured by the total export value
for goods, according to the U.S. Department of Commerce.
Longstanding sticking points in the negotiations include
European rules protecting regional food names such as feta and
Parma ham, and U.S. rules protecting domestic companies bidding for
government contracts.
Mr. Gabriel indicated he doesn't oppose free-trade deals per se.
He defended a planned deal with Canada, the Comprehensive Economic
and Trade Agreement, which he described as "a real quantum leap."
That deal would make trade easier without reducing standards for
labor and the environment, Mr. Gabriel said.
Mr. Gabriel's Social Democratic Party is set to vote next month
on whether to support the Canadian free-trade deal.
However both U.S. presidential contenders have indicated they
are skeptical of sweeping free-trade agreements. Hillary Clinton
and Donald Trump have criticized the recently agreed-upon
Trans-Pacific Partnership, a trade pact between the U.S., Japan,
Canada, Australia and eight other countries around the Pacific.
Meanwhile the TTIP deal has been rapidly losing popularity with
the German public. In May, public broadcaster ARD's
DeutschlandTrend survey showed that 70% of Germans opposed the
deal, a 15-point increase since 2014.
Viktoria Dendrinou contributed to this article.
Write to Tom Fairless at tom.fairless@wsj.com
(END) Dow Jones Newswires
August 28, 2016 17:36 ET (21:36 GMT)
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