France calls for an end to transatlantic trade pact

The transatlantic trade pact intended to unite Europe and North America in a vast economic zone is close to collapse after France called for a complete suspension of talks.

LONDON: The transatlantic trade pact intended to unite Europe and North America in a vast economic zone is close to collapse after France called for a complete suspension of talks, accusing the US of blocking any workable compromise.

"Political support in France for these negotiations no longer exists," said Matthias Fekl, the French commerce secretary.

Mr Fekl said his country would request a formal decision by EU ministers at a summit in Bratislava in September to drop the hotly contested deal, known as the Transatlantic Trade and Investment Partnership (TTIP).

"The Americans are offering nothing, or just crumbs. That is not how allies should negotiate. There must be a clear and definite halt to these talks, to restart them later on a proper basis," he said.

The project is infinitely more than a trade deal. It is part of a strategic push to bind together the two sides of North Atlantic civilisation at a dangerous moment when the Western liberal order is under profound threat, heading off the current drift towards divorce.

"TTIP was supposed to set the rules for the global trade," said Rem Korteweg, a trade expert at the Centre for European Reform. "It was to be a central pillar of an alliance of like-minded countries. If it all falls apart in acrimony, and what kind of global governance are we going to have?" he said.

Mr Fekl's hard-line comments were echoed in slightly softer language by French president Francois Hollande, who said yesterday that there was no chance of a deal on TTIP before the next administration takes power in Washington. "The talks have become bogged down, the positions have not been respected, and the imbalance is obvious. It is better that we face up to this candidly rather than prolong a discussion on foundations that cannot succeed," he said.

It is hard to judge how much of the rhetoric from Paris is negotiating brinkmanship as the TTIP talks reach a critical phase, or posturing by the French socialist party in advance of elections next May.

France cannot single-handedly strip the European Commission of its mandate to press ahead with the negotiating process. This would require a qualified majority vote. But there is little doubt that free trade advocates have lost the battle for public opinion in Europe.

The Left has made much of negotiation documents leaked to Greenpeace that suggests the EU's "precautionary principle" has succumbed to the rival "risk-based" doctrine of the US,

allegedly opening the way to a "race to the bottom in environmental, consumer protection, and public health standards". Free traders have struggled to rebut this.

Mr Kortweg said the EU elites took the public for granted, failing to sense the growing backlash against globalisation. "They dropped the ball and lost control in framing the narrative."

The parallel drama in the US has different contours. Public wrath is largely directed at the Pacific trade pact (TPP), seen as a tool for multinationals to undercut US standards by exploiting cheap labour and lower ecological standards in Asia.

The TTIP crisis is essentially a European story. The project is not yet dead but support is ebbing away in a string of countries. While German Chancellor Angela Merkel still supports the talks, just 17pc of the German public back the accord. She can no longer keep her Social Democrat (SPD) partners in the coalition fully on board.

Even if Germany stays the course on TTIP, it is far from clear whether the Netherlands would ever be able to ratify it. Dutch law allows activists to force a referendum on any new treaty once they have collected 300,000 signatures, and they have already used this procedure to scupper the EU's association agreement with Ukraine.

The Commission estimates that TTIP would add 0.5pc to Europe's GDP through trade gains from lower tariffs and agreed standards. This is a relatively trivial sum set against the larger political issues at stake.

The accord clearly raises red flags over who sets the law and holds the whip hand in parliamentary democracies. Critics argue that it creates special tribunals outside the normal court system that effectively allows companies to overturn laws passed by elected legislatures.

Some say Brexit was the first primordial scream against this emerging world order. If so, the grass-roots uprising against the TTIP project may be the second.

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