Chancellor Merkel has made it clear that reinvigorating the transatlantic economic relationship will be top of her agenda during her six months at the helm of the EU.
Although efforts have been made since the early 1990s to reduce regulatory obstacles hampering trade and investment between the EU and the US, few tangible results have been produced.
EU-US talks on creating a "single sky" recently broke down (EurActiv 07/12/06) because US Congress did not want to allow the EU to invest in US airlines. Europeans are concerned that this creeping protectionist tendency in the US will worsen now that the Democrats – considered more hostile to free trade than the Republicans – have taken over Congress.
But Merkel hopes to iron out the differences in European and American laws in areas such as financial-market regulation, patents and intellectual property law, and harmonise standards in important industries such as the automotive industry.
Whether she will be more successful than previous efforts is hard to tell. Remaining barriers between the already highly integrated EU and US markets tend to stem from political sensitivities or from strong lobbying on both sides – as was the case in the recent dispute between the two blocs regarding genetically modified foods.
Nevertheless, eliminating restrictive regulations in areas such as financial services and IPR could give a boost to the $3 trillion economic relationship – one that is sorely needed at a time when global trade talks are stalled and China and India are emerging as the economic superpowers of the future.
Chancellor Merkel has also just taken over the G8 Presidency and other items discussed with President Bush included Iran, Afghanistan, Lebanon, Merkel’s ideas for a new Middle East peace initiative and climate change.
