Setting the record straight on the US-EU relationship

EPA-EFE/STEPHANIE LECOCQ

US President Donald J. Trump and Secretary of State Mike Pompeo attend a meeting at the American Embassy in Brussels. 

US Ambassador to the EU, Gordon Sondland, discusses trade relations


Share on Facebook
Share on Twitter
Share on Google+
Share on LinkedIn
+

In the days immediately after United States Secretary of State Mike Pompeo’s address in the Concert Noble unsettled the Brussels establishment, New Europe’s Director of European Affairs Andrianos Giannou had the chance to speak with US Ambassador to the European Union Gordon D. Sondland at an on-the-record briefing of the EU press corps on December 7.

It was Pompeo’s clear and unequivocal defence of principled realism, the underpinning tenet of the new national security strategy under the Donald J. Trump administration that made waves. The rationale behind it is impossible not to embrace axiomatically: “Every nation must … ask if the current international order serves the good of its people as well as it could,” the United States’ top diplomat said. “And if not, we must ask how we can right it.”

Sondland assuredly subscribes to this theory and refers to the “need for any multilateral institution to be responsive to the constituents that put it together,” as reflected in Secretary Pompeo’s speech. Sondland feels confident corroborating that, had he reviewed the speech – he was “out of town for the trade talks in DC” – he “would have made it even stronger,” putting to rest suggestions from within the halls of the EU that had the US Mission perused the speech ahead of time, it would have been different.

The message is clear, however. There is no dissent over things Europe within the US administration. Europeans looking to exploit cracks in the wall should change tack. There aren’t any. As is “playing a waiting game” until the end of the administration’s mandate in the hope of a change in 2020. That is “not a fruitful pursuit,” given that the current trade deficit would “not be sustainable under any administration.”

The current trade deficit was the key point of discussion at the briefing, with Sondland saying the $150 billion deficit is not sustainable and the European Union and the United States need to “trade in a more balanced fashion”.

The US’ Trade Representative Office’s data shows that in 2016 the trade imbalance rose to $92 billion, a number that was not tipped in the United States’ favour. The deficit of goods trade – the principle issue for the US Ambassador – stood at $147 billion. The trade surplus for services reached a total of $55 billion for the US in 2016. It is not helpful that the European Union chooses to selectively focus on the services trade surplus, however. The Ambassador calls such practice “a specious argument.” 

With the Transatlantic Trade and Investment Partnership permanently shelved and the risk of a trade war, prioritisation of job creation under the Trump administration as well as 15 million jobs at stake on both sides of the Atlantic, his argument should be taken as a concern, not a threat.

The United States is “entitled to a little bit of consideration,” said Sondland. “Numerous attempts to engage with (the Directorate General for) Trade were rebuffed each time until steel and aluminium tariffs were threatened and subsequently imposed,” adding, “The expectation is that the European Union will become responsive to our concerns.”

Lists of “non-tariff barriers, subsidies, and structural frameworks designed exclusively to exclude American companies” have been sent to EU officials multiple times to no avail, Sondland claimed, who added that they will have to be “relaxed or eliminated,” for the trade relationship to be beneficial for both parties.

Right now, “one party is benefiting greatly while the other party is at a complete disadvantage financially.” It is the European Union that chose to see this in a transactional manner, the Ambassador suggests. “It’s what have you done about me lately, not what we have done for each other in the past 70 or 80 years,” he remarks on the approach of the European Union.

What is to be done? Recent talks between European Commissioner for Trade Cecilia Malmström and US Trade Representative, Robert Lighthizer, were “friendly” but “no sustainable trade progress was made”.

Sondland stressed that “Even the easy stuff is being made difficult,” but Trump is “keenly aware of the lack of progress and is losing patience”. “If his hand is forced, all options are on the table. At some point, and that point is coming sooner rather than later, the US will do whatever it has to do to rebalance the trade relationship, voluntarily or involuntarily.”

Trump believes that the European Union will have to recognise the exceptional nature of the trade relationship and show openness to the concerns of a strategic partner that has stood by it. “It’s not a hard fix to make. I know I spend a lot of time talking about trade…that’s what often dominates the transatlantic discussions here in Brussels.  But we also need to step back so we don’t lose perspective. Think about what the United States and the European Union have to offer when we work together. Setting global standards that ensure safety and health, confronting the threat of a China unconstrained by international norms, providing an example for fledgling democracies—these are real opportunities.  Sure, we might chide each other, but the reality is that a US and EU-led world is far better than any other alternative,” Sondland enthusiastically concluded.

For this special strategic partnership to outlast the determination of its common enemies to see it collapse, both sides will have to strife to strengthen the bond by making it work for those who truly matter – their citizens. They are the only ones who can make it or break it by either embracing it or rejecting it.

Share on Facebook
Share on Twitter
Share on Google+
Share on LinkedIn
+