Shot in the arm for transatlantic trade talk?

Date: 19/06/03

By Karen Carstens

WHILE the upcoming EU-US summit in Washington will primarily focus on patching up diplomatic differences and staving off a long-term postwar political impasse, another key point on the agenda will be breathing new life into a slumbering beauty of an idea - the Trans-Atlantic Business Dialogue (TABD).

"We do have disputes between the United States and Europe, but it is an infinitesimally small amount of our trade and investment relationship," Grant Aldonas, the US under-secretary of commerce for international trade, said while on a visit to Brussels in April.

With Europeans and Americans attempting to smooth out a range of political catchpoints on 25 June, "you have to have something that provides a bit of a counterweight to that," he added.

"And on the economic and commercial side, I think we can do that."

Commissioners Erkki Liikanen, enterprise, and Pascal Lamy, trade, will attend a 24 June brainstorming session ahead of the summit that aims to revitalize the TABD process.

It has been widely criticized in recent years for becoming too bloated, leading CEOs to shy away from the conference that has been the TABD's lynchpin since it began eight years ago.

The first such global gathering was held in November 1995 in Seville; the most recent took place last November in Chicago.

"When the TABD was first kicked off it was at a time when there was no negotiation in the WTO," Aldonas said. "There were some points of bilateral friction between the United States and Europe.

The goal was really to create a vehicle where businesses can have a discussion about those sorts of points and bring them to the governments.

"I think where we are now is we need businesses' input on some of the broader issues that confront the United States and Europe," he added.

EU officials have complained that it would have helped if Robert Zoellick, the US trade representative, were also in attendance, but he will be returning to Washington on a flight from Jordan as the meeting takes place.

They have also said that the Bush administration seemed lukewarm at best about the TABD, essentially an informal process through which business communities strive to develop joint trade policy recommendations.

But in recent months there has been renewed interest in revitalizing the process. Jeff Werner, executive director of the TABD office in Washington, said a more streamlined - and hopefully effective - strategy of holding the big CEO meetings immediately before EU-US summits would probably be decided upon as the best new strategy at the 24 June meeting.

At the same time, a larger network of expert working groups that feed into these big-shot gatherings would continue to look at more detailed sectoral issues, he said. Regulatory convergence remains a key priority area, as does the WTO agenda and dispute management.

"Business has been very concerned and is looking at getting things back on track," Werner said. "But we're really on an upswing now - people like Grant Aldonas and the folks looking at the business side of things over at the Commission, they really want to fix things and repair the links and rebuild things. They want to re-establish that close relationship and, in some ways, TABD has become more relevant now than ever before."

One potential outcome of the meeting in Washington that remains unclear, however, is whether or not two new CEOs from each side of the Atlantic will be targeted by business leaders to head up the TABD for the next year.

"This may or may not be announced after the meeting," Werner said.

The TABD is structured so that one CEO from each side is officially at the helm in annual cycles, although there is usually a "dormant" phase of several months following the traditional big annual conference. Last year's head honcho on the US side, Boeing Chairman and CEO Philip Condit, has gone beyond the call of duty to help oversee the current revitalization process, while Jürgen Strube, the current chairman of German chemicals giant BASF, who will take on the helm of EU business umbrella group UNICE in July, has stepped in on the EU side on a temporary basis.

Meanwhile, Dutch-Anglo food and soap giant Unilever and Coca-Cola have been cited as candidates interested in taking over the reins this year, but the two honorary posts remain up for grabs.

Werner said the Commission's role right now is to find a European firm that wants to take on the task - telecommunications companies, conversely, have reportedly not shown much interest in the past - and then step back and let the businesses take over.

But this is not to say that the public officials involved are secondary to the whole process, he was quick to add.

"When TABD was established back in 1995, it was taken a year at time - each year we asked ourselves if there are issues we still want to pursue and each year it's always been decided "yes, let's go for another". As long as there's support from all four sides (US and EU businesses and governments) there is support for that process, but if just one of those pillars goes, then TABD goes too."

"This [24 June] meeting is a big step," he added.

"We're certainly moving in the right direction with the [Bush] administration, we're certainly seeing this as something they want to make their own."

And, as Aldonas put it during his April visit to Brussels: "To the extent that TABD works, it's because the governments are accountable at the end of the day and follow through on the things that business has presented as issues."

Europe and the US account for 40% of world gross domestic product and more than a third of global trade.