Talks on a trade deal between the U.S. and the European Union, which could be the biggest bilateral deal ever, will begin in Washington next month.
“We intend to move forward fast,” European Commission President Jose Barroso told reporters today at the start of the Group of Eight summit in Lough Erne, Northern Ireland. He was standing alongside President Barack Obama, EU President Herman Van Rompuy, and their host, U.K. Prime Minister David Cameron.
“We’re talking about what could be the biggest bilateral trade deal in history, which would have an impact bigger than all the other trade deals put together,” Cameron said. Both sides already have goods and services trade valued at $2 billion a day.
For European nations held back by the three-year-old debt crisis, which has sent euro-area unemployment to a record and helped push the U.K. into a double-dip recession, a trade deal offers one way of spurring growth without increasing debt. A deal may take two years to put together.
The European Commission estimates an agreement could generate annual economic benefits of 119 billion euros ($159 billion) for Europe and $126 billion (95 billion euros) to the U.S.
EU negotiations over the last few weeks have exposed internal differences that may end up threatening a deal. The French government vowed to wield its veto power unless audiovisual policies were fully excluded from the commission’s mandate, saying culture can’t be treated as a commercial item.
The commission and most EU nations including the U.K. and Germany opposed that stance and pressed France to show flexibility. They proposed to fix so-called “red lines” for the talks to ensure European policies to promote cultural works wouldn’t be jeopardized, while allowing some possible concessions to the U.S. so the EU would have greater leverage over other matters, such as American public procurement.
EU ministers carved the audiovisual industry out of the mandate to win French support, while leaving the commission the right to request permission to negotiate on this issue later.
Other potential areas of discord are public procurement, where so-called Buy America rules represent barriers for Europe, and agriculture, including genetically modified foods that the EU regards more skeptically than the U.S.
The idea for the agreement “has been warmly received in the United States,” Obama said. Reaching a deal “is going to be a priority of mine and my administration.”