US/EU TRADE RELATIONS

Yesterday following my pig story Mark from the Centennial State had a question on US/EU Trade Agreements, and this is a very good link.

Without kind permission from my new EU boss Barroso I will reproduce the following paragraphs since they are quite relevant and illustrate how strange (tragic?) it is that two political blocs which are so dependent on each other economically, apparently seem to have such a political abyss dividing each other.


The EU and the US are each other's main trading partners and account for the largest bilateral trade relationship in the world. They are also the largest players in global trade.

The EU and the US both account for around one fifth of each other's bilateral trade, a matter of €1 billion a day. In 2003, exports of EU goods to the US amounted to € 226 billion (25.8% of total EU exports), while imports from the US amounted to € 157.2 billion (16.8 % of total EU imports).

The investment links are even more substantial. The EU and US are each other's largest trade and investment partner. The total amount of 2-way investment amounts to over € 1.5 trillion, with each partner employing directly and indirectly about 6 million people in the other. The share of EU investment in the US amounted to more than 52% of EU Foreign Direct Investment over the period 1998-2001 (€ 162.663 million a year in average), while US investment in the EU amounted to more than 61% of EU FDI inflows over 1998-2001 (€72.041 million a year in average).


So why it is obvious that the EU exports far more to the US than it imports from it, this is compensated somewhat by the fact that EU investments are more than double those of US investments in Europe.

Now that link offers new links to stuff like the Clinton-era New Transatlantic Agenda (1995) and the accompanying EU/US Joint Action Plan, which I fear is for a large part hollow letter. Much more interesting is the November 9, 1998 Tranastalantic Economic Partnership. Have a glance at it, there’s a lot going on without us being aware of it.

You may also note there has been that June 25/26 2004 EU/US Summit in Dromoland Castle, Ireland. Since that summit dealt mainly with Iraq, the Middle East, counterterrorism coordination and agreements on our respective navigation satellite systems (US: GPS, EU: Galileo), I don’t think the summit is that important from an economical POV. More important was imho the related Brussels June 25 meeting, the Trans-Atlantic Business Dialogue, or TABD. On that meeting recommendations for four priority areas were given, namely:

a.) Open Trade and Security
b.) Intellectual Property Rights and the Fight against Counterfeiting
c.) Capital Markets and International Accounting Standards
d.) World Trade Organisation and the Doha Development Round.

Note though there were only recommndations, not agreements. Still I thought it worthwile to mention this TABD. At least there seem to have been "considered replies" from both the US government and the EU Commission. I figure there's a lot going on behind the scenes.

There’s been some talk over here in recent years about the necessity of harmonizing our accounting standards (read modeling EU accounting standards to US standards). If I have some time left or Easter falls on a Monday I’ll try to entertain you about that last one, Inshallah.


Yawn. 1.29am. I am a fool after all.