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Industry welcomes Obama’s support for US-EU trade talks
10:09 AM MST | February 21, 2013 | —Lindsay Frost
Industry groups on both sides of the Atlantic welcomed President Obama’s call for a US and EU trade agreement in his State of the Union address on 12 February. Industry groups released statements supporting the talks and called on EU and US officials to use the opportunity to enhance regulatory cooperation.
“Growing US exports is a guaranteed way to drive our economy back to sustained growth,” says Cal Dooley, president and CEO of ACC. “That is why ACC strongly supports the President’s call for a comprehensive US-EU free trade agreement, which could generate $2 billion in export growth in the chemical industry alone.” ACC encouraged Congress to grant the President trade promotion authority so he can negotiate a new agreement with the European Union and other pending agreements such as the Trans-Pacific Partnership.
“A trade agreement would lower costs of chemicals trade, help grow economies, and create jobs on both sides of the Atlantic,” says BASF chairman and current Cefic president Kurt Bock. Cefic says any agreement should go beyond a free trade deal to include issues such as regulatory cooperation and other nontariff barriers.
“The United States is already the European Union’s biggest chemicals trading partner, with total chemicals trade activity reaching €46 billion ($61.3 billion),” Cefic says. A deal between the 2 largest economies would wipe out €1.5 billion in chemical import duties, several hundred million of which involving intracompany trade, Cefic estimates.
“American chemical manufacturers see eye to eye with our European counterparts on the value industry can bring to these negotiations and calls on governments to include chemicals as a priority sector in the negotiations,” says Mike Walls, ACC v.p./regulatory and technical affairs. “The potential cost savings—for industry and for government—from enhanced regulatory cooperation are even greater. Given chemistry’s early position in the value chain, these cost savings would be amplified downstream for the countless businesses that depend on our products.” The agreement has the potential to significantly boost growth and job creation on both sides of the Atlantic, Walls adds.
“Trade agreements provide US chemical manufacturers greater access to the world’s consumers and positively contribute to the growth of the US economy,” says Lawrence Sloan, Socma president and CEO. Socma says it will soon announce recommendations to help address nontariff barriers, including the EU Registration, Evaluation, Authorisation, and Restriction of Chemicals law.
VCI’s director general Utz Tillmann notes that the average US chemical tariff is 2.25%, but with the enormous trade volume between the 2 regions even low charges cause high costs. “In 2010, European chemical companies paid almost €700 million to the US Treasury for exports stateside,” Tillman says. Discussions should also focus on eliminating nontariff trade barriers, he adds.
“As the first step, regulations and standards for protecting the environment, consumers, and health should be stronger attuned [between the United States and European Union] and finally lead to mutual recognition.”