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EU takes a bad trade gamble against US

By Zaki Laidi | China Daily | Updated: 2013-07-23 07:31

This is especially relevant with respect to China. The US very clearly wants to check China by raising global trade standards. But, if broader geopolitical considerations brought these two countries to an agreement, Europe could suffer.

Something akin to this happened during the climate change conference in Copenhagen in 2009, where the US and China decided to oppose a comprehensive global agreement, effectively dismissing Europe. Likewise, the US has no real interest in revitalizing multilateral trade negotiations, because bilateralism is much more effective in extracting concessions from emerging powers.

Europe has neither the same geopolitical interests as the US, nor, more important, the same means, which implies that it has a greater stake in revitalizing multilateral trade. Indeed, the proliferation of bilateral agreements, with their own mechanisms for resolving differences, will inevitably weaken the WTO's dispute-settlement mechanism, further undermining multilateralism.

The need to revive multilateralism is all the more important given that EU-US negotiations will likely be difficult and prolonged, owing especially to resistance from European and American regulators. European regulators have already decided to tighten conditions for authorizing genetically modified organisms, as if to show US trade negotiators that they will not move easily from cherished positions.

Now that the TTIP talks have officially been launched, Europe must try to obtain the best terms that it can. Above all, the EU must accept that global trade is a merciless political game, played according to a paramount rule: keep all of one's options open at all times.

The author is professor of International Relations at L'Institut d'tudes politiques de Paris (Sciences Po), and the author of Limited Achievements: Obama's Foreign Policy.

Project Syndicate

(China Daily 07/23/2013 page9)

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