G-7 Leaders Aim for TTIP Outline By Year’s End, Make Global Climate Push
Leaders from the G-7 countries agreed on Monday to aim for an immediate acceleration of negotiations for a bilateral trade and investment deal between the US and EU, including an outline of such an agreement “as soon as possible, preferably by the end of the year.”
The 7-8 June summit, hosted by Germany in the Bavarian Alps, also featured a series of other key announcements on a host of topics, including a major pledge on limiting global warming and eliminating fossil fuel subsidies.
The Group of 7 includes Canada, France, Germany, Italy, Japan, the US, and the UK. The EU also participates in the meetings, though is not itself a G-7 member given its status as a supranational organisation. The coalition was previously known as the G-8, until Russia was suspended from the group last year following the Ukrainian crisis.
The state of the global economy was one of the overarching themes of the two-day meet, with leaders noting in their declaration that while growth appears to be strengthening in some major economies, many still are “operating below their full potential.”
Trade and investment, they said, are both key toward boosting global economic growth, jobs, and sustainable development. To that end, they said, their countries would be pushing for the G-20 to sign off on extending once more its “standstill” commitment against raising or imposing new barriers to trade and investment.
In their communiqué, leaders affirmed that strengthening the multilateral trading system “remains a priority.” However, they also welcomed efforts on other trade fronts, such as the negotiation of bilateral, regional, and plurilateral trade deals.
Notably, leaders pledged that they would aim to reach an outline on the Transatlantic Trade and Investment Partnership (TTIP), being negotiated between the EU and the US, preferably by December. The talks are now in their third year, with negotiations generally being acknowledged to be lagging behind – an increasingly worrisome prospect for some observers, given the upcoming US general election year, which could slow the talks further.
German Chancellor Angela Merkel, for her part, said following the G-7 meet that the EU and US “will be able to” conclude TTIP before US President Barack Obama leaves office in January 2017, in an interview given to the German Public Broadcasting Station.
The statements come as the TTIP deal continues to generate controversy on both sides of the Atlantic. A planned European Parliament plenary vote on TTIP-related recommendations that was set for this Wednesday was postponed indefinitely, after the chamber’s president, Martin Schulz, reported that over 200 amendments had been tabled.
The TTIP report that had been approved by the Parliament’s international trade committee (INTA) just a week ago has therefore been sent back to the committee level, together with the various new amendments. A scheduled debate on the TTIP resolution, also set for Wednesday, has similarly been postponed by parliamentarians. (See Bridges Weekly, 4 June 2015)
TPP, EU-Japan talks
G-7 leaders also announced tentative goals for two other major trade pacts under negotiation – the 12-country Trans-Pacific Partnership (TPP) talks, as well as the EU-Japan negotiations for a free trade agreement/economic partnership agreement (FTA/EPA).
“We will make every effort to finalise negotiations on the TPP as soon as possible as well as to reach agreement in principle on the EU-Japan FTA/EPA preferably by the end of the year,” leaders said.
While the TPP talks are said to be in their endgame, member countries have been hesitant to take the final steps toward clinching an agreement until the US Congress renews Trade Promotion Authority (TPA).
That legislation, which sets US negotiating objectives in trade deals and allows the President to submit finalised agreements to the legislative branch for a straight up-or-down vote, without amendments, is currently under consideration by the House of Representatives, with a vote set for the end of the week. The Senate already approved the bill last month. (See Bridges Weekly, 4 June 2015)
Meanwhile, EU and Japan leaders confirmed last month at a summit in Tokyo that they would be speeding up their negotiations, though on the European side officials have conditioned the year-end goal as one depending on substance. (See Bridges Weekly, 4 June 2015)
Regarding the WTO, the leaders said that this year’s focus should be on bringing the Trade Facilitation Agreement (TFA) into force. That deal, which aims to lower customs barriers and ease red tape at borders, was inked at the global trade body’s 2013 ministerial conference in Bali, Indonesia, and has been open for domestic ratification since November of last year. (See Bridges Weekly, 27 November 2014)
To date, seven WTO members have submitted their instruments of acceptance for the TFA, with Australia being the latest to do so. To bring the deal into effect, domestic acceptance is needed by two-thirds of the WTO’s 161 members.
Notably, G-7 leaders also called for “swift agreement” of a work programme aimed at concluding the WTO’s Doha Round trade talks. The deadline for such a plan is end-July; however, the talks in Geneva have to date reported slow progress, particularly in agriculture – one of the core areas of the negotiations. (See Bridges Weekly, 4 June 2015)
“Both the implementation of the TFA and agreement on a post-Bali work programme should lay the ground for a successful MC 10, the first WTO ministerial to be held in Africa,” leaders said, referring to the global trade body’s tenth ministerial conference. That meeting is set for 15-18 December in Nairobi, Kenya.
WTO Director-General Roberto Azevêdo, who was on hand at the G-7 meeting to discuss the status of the trade negotiations, welcomed the political backing from leaders.
“I told G-7 members that delivering a work programme by July will be an important step to ensuring that the Ministerial Conference in Nairobi is a success, and that it delivers important outcomes, particularly for our least-developed members. This [programme] may be the best chance we have had to complete the [Doha Round],” the WTO chief said.
In a landmark move, leaders also pledged to limit the rise in global temperatures to a maximum of 2 degrees Celsius above pre-industrial levels, while working toward a “low-carbon global economy in the long-term.”
Citing data published by UN scientists, leaders said they support the recommendation to slash greenhouse gas (GHG) emissions by 40 to 70 percent by 2050, relative to 2010 levels. Leaders also affirmed a commitment “to the elimination of inefficient fossil fuel subsidies,” as well as also reiterating their hope of making the Green Climate Fund (GCF) operational this year.
The GCF is geared toward helping rich nations fulfil their pledge to set aside US$100 billion annually by the end of the decade for climate mitigation and adaptation in the world’s poorest countries. (See Bridges Weekly, 27 November 2014)
The G-7 leaders’ pledge came as UN negotiators finish a two-week series of meetings in the German city of Bonn aimed at slimming down the draft text for a new global climate deal from approximately 90 pages to something more manageable. (See Bridges Weekly, 4 June 2015)
A final version of this new climate deal is expected to be agreed at the UN Framework Convention on Climate Change’s (UNFCCC) annual Conference of the Parties (COP) in December, which would then take effect from the end of this decade.
“The G-7 leaders issued a powerful statement on climate change today, committing themselves to aggressive action to reduce greenhouse gas emissions and to lead the decarbonisation of the global economy,” said World Bank President Jim Yong Kim on Monday following the news.
ICTSD reporting; “Climate Change Headlines G7; Merkel Commits to Conclude TTIP During Obama’s Term,” INTELLECTUAL PROPERTY WATCH, 9 June 2015; “Parliament postpones EU-U.S. trade vote,” POLITICO, 9 June 2015; “G7 leaders agree to phase out fossil fuels,” FINANCIAL TIMES, 8 June 2015.