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EU, US to launch talks for world's biggest trade pact

17th June 2013, Comments 0 comments

The EU and United States are set to launch negotiations on Monday to create the world's biggest free-trade pact despite a hard line by France to protect its film and culture sectors from Hollywood.

Such a trade deal is touted as a potentially huge boost to business, economic growth and job creation, but the culture issue is seen as potentially offering a bargaining chip to the US side.

President Barack Obama and European leaders gathered at the G8 summit in Northern Ireland prepared to announce the formal start of talks on the pact, just days after the EU thrashed out a last-minute deal to keep the French happy.

But the head of the EU executive, Jose Manuel Barroso, who is also at the summit along with EU president Herman Van Rompuy, weighed in with an unusually outspoken criticism of France for its "reactionary" behaviour to defend its audiovisual and cultural industry.

"Some say they belong to the left, but in fact they are culturally extremely reactionary," the president of the European Commission said in an interview with the International Herald Tribune on Monday.

If the EU-US deal is done, it would be the world's largest Free Trade Agreement: bilateral trade in goods last year was worth some 500 billion euros ($670 billion), with another 280 billion euros in services and trillions in investment flows.

The EU says an FTA would add about 119 billion euros annually to the EU economy, and 95 billion euros for the United States.

British Prime Minister David Cameron, who is hosting the G8 meeting of leading industrialised nations, made no mention of the row with France as he hailed the deal.

"My focus is very clear -- getting agreements, signing deals, making progress on issues that will help hard working families right here in the United Kingdom. For me, that's what the agenda of this G8 is all about," Cameron said.

-- "Twelve to eighteen months" for a deal --

The British prime minister's spokesman said he expected it to take "twelve to eighteen months" for the EU and US to complete negotiations, dismissing speculation that it could take years for anyone to see the benefits.

He added: "I think that what you are going to see today is really good important news with the launch of the EU-US trade negotiations."

He also played down the row over France's so-called "cultural exception."

"I wouldn't characterise it in those terms," he said.

"The audiovisual sector is not on the table at this stage but there is the explicit position for the (European) Commission to propose for it to be brought forward."

He said key liberalised areas would include the airline sector.

The bloc's 27 trade ministers agreed the terms of the Commission's mandate to negotiate an EU-US free trade deal at marathon talks in Luxembourg on Friday.

France insisted that the audiovisual sector be excluded from the negotiations and after 13 hours of talks, a compromise was reached agreeing to Paris' demand while stating that the Commission could come back on the question if necessary.

France jealously guards its cultural sector: French television stations are required to air at least 40-percent home-produced content, with another 20 percent coming from Europe before American TV soap operas even get a look in.

Cinema-goers pay a levy on each ticket to help fund the French film industry, which many believe could not survive without such support in the face of Hollywood's dominance.

Without naming France, Barroso said that those fearful of a US cultural invasion of Europe "have an anti-cultural agenda."

Such critics have "no understanding of the benefits that globalisation brings also from a cultural point of view," he added.

EU officials have repeatedly warned that excluding any economic sector could hand the US an early bargaining chip in what promise to be tough negotiations.

Washington says no areas should be excluded from the talks although there have been reports that it may seek an exception for some financial services.

© 2013 AFP

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