Spying scandal will not threaten trade deal, says top US envoy

William Kennard.jpg

This article is part of our special report EU-US trade talks: moving forward?.

EXCLUSIVE / As EU, US negotiators meet today (8 July) for the first round of talks on an ambitious transatlantic trade agreement, outgoing US Ambassador to the EU William E. Kennard promised a ‘healthy debate’ between the two partners in the light of recent spying allegations.

“We have such a deep and broad relationship that it would be unfortunate if we allowed one issue, as serious as it is, to paralyse us across a whole range of other issues we're working on,” Kennard told EURACTIV in an interview.

Europeans have reacted angrily to revelations that an American spy agency monitored phone calls and e-mails of EU institutions and some member states, with some politicians calling for a suspension of negotiations over a transatlantic trade agreement until further clarification is provided.

>> Read: Parliament to launch enquiry into US eavesdropping

Despite differences in data protection regimes and perspectives, Kennard argued for finding the right balance, as the flow of data is not only essential for the functioning of the economy, but also indispensable for cooperation on law enforcement and counter-terrorism.

“We have to work these issues through and the good news is we have,” he added, taking examples like the Terrorist Finance Tracking programme (TFTP), the Passenger Name Record (PNR) and the SWIFT banking agreement.

“In each case we found a way to effectively converge our systems. The EU is concerned, under their privacy laws, about proportionality of data and in both PNR and TFTP. We put those issues on the table and we found a way to work through them,” Kennard said, stressing he was optimistic the two will find common ground.

Two separate working groups have been set up to discuss the extent of US intelligence activities and questions of privacy and data protection.

These will move on parallel track to the trade talks, which are scheduled to begin on Monday [8 July] in Washington. Both the European Commission and the European Parliament have agreed to move ahead on trade negotiations, despite calls from Greens and French Socialists to freeze negotiations until Washington explains whether it was spying on EU offices and European governments.

Forget carve-outs, be creative

As negotiators meet, Kennard pointed out that there is no other way to make progress on a trade deal than going at it with an open mind.

“Our relationship is so mature that in order to solve the long-standing trade disputes, we're going to have to bring creative, innovative thinking,” he said, adding that carving entire industries makes it difficult for negotiators to address regulatory problems.

“If we want to have an ambitious and comprehensive agreement, we have to put everything on the table," he said.

France's battle over the exemption of the audiovisual sector from the negotiating mandate showed the challenges facing negotiators, but there is broad common ground over areas such as aviation and electric cars.

“They [regulators] have an incentive to work together, particularly in an era of austerity and shrinking government budgets. If European and US regulators can find ways to work more effectively together, we can save a lot of money on both sides of the Atlantic,” he said.

“We're not starting from zero. There are a lot of areas where we've done this in the past.”

The EU-US deal has the potential to be the world’s biggest ever bilateral trade and investment arrangement.

The EU and the US already trade goods and services worth €2 billion every day. A comprehensive EU-US deal could over time boost EU GDP by 0.5% annually and help create approximately 400,000 jobs in the EU, according to the European Commission.

A pivot with Europe to Asia

Asked whether the trade talks meant that the United States was shifting its focus from Asia to Europe, the ambassador said there were misunderstandings about the so-called pivot to Asia.

“There is a shifting of more growth and economic activity to that region. But we don't think of the pivot being a shot away from Europe,” he said.

“We think that Europe is in the process of shifting more of its attention to Asia as well. Developed markets in the West will have to spend more time engaging with Asia. So we think of this as a pivot with Europe to Asia as opposed to away from Europe.”

Europeans have reacted angrily to revelations that US authorities had tapped the servers of internet companies for personal data, with some politicians calling for a suspension of negotiations over a transatlantic trade agreement until further clarification is provided.

>> Read: MEPs call for freezing EU-US trade talks over spying allegations

According to the EU Commission and other European bodies, a comprehensive trade and investment agreement could over time boost EU GDP by 0.5% annually and help create approximately 400,000 jobs in the EU.

The Transatlantic Trade and Investment Partnership (TTIP) will extend beyond the removal of tariffs, to include the opening of markets on investment, services and public procurement. In addition, it will focus on aligning rules and technical product standards which currently form the most important barrier to transatlantic trade.

  • 8-11 July: First round of negotiations for TTIP (Transatlantic Trade and Investment Partnership)

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