Good morning. Thank you, Mr. Chairman, for your kind invitation to appear before this committee. This is my first appearance before a Committee of the European Parliament. When I arrived in Brussels in March, you were already in election mode. I’m pleased that the Parliament is now in full operation and that we can begin a dialogue.
I appreciate the critical role that this institution plays: the steady expansion of its legislative powers with every new EU Treaty, including the Lisbon Treaty, has been an important contribution to reinforcing the democratic legitimacy of the EU institutions. In my hearings before the US Senate, I specifically referenced my desire for strong relations with the European Parliament; in my first major policy speech shortly after I arrived I listed this desire as one of my four key priorities for the next three years. I know, of course that the Parliament, and specifically this committee, will play a key role in determining whether the TTIP negotiations succeed.
I’ve had the opportunity to meet several members of this committee, including Commissioners Reding and Rehn. As Commissioner Reding knows, concluding the negotiations on both Safe Harbour and the Data Privacy and Protection Agreement is a top priority for me. I take the data privacy issue very seriously indeed and I am committed to restoring trust in transatlantic data flows. And I can tell you that I and the USEU Mission played an important role in Attorney General Eric Holder’s recent statement that the Obama administration will seek Congressional legislation extending to EU citizens the same rights that US citizens have under the Privacy Act.
Alexander and Marietje, it is good to see you again as well. I’m pleased to see Jozsef Szajer again after many years; we first met at Oxford in 1986 and then again at Columbia Law School in 1990. I’ll never forget a presentation you gave in 1990 in which you described your dream of free elections in Hungary and your ambition to represent Sopron in Parliament. I noticed that Jaroslav Walesa is a member of this committee: I had the great privilege of meeting and interviewing Lech Walesa in Gdansk when I was studying at the Jagiellonian University in Krakow and he was under house arrest. His courage in challenging authoritarian rule is an example to us all.
I have been involved in and have cared about EU issues for 23 years – first as a lawyer, then as a government official in the White House, and more recently as banker and investor living and working in Europe. Ever since my studies of EU policy and law at Oxford and Columbia Law School and my time as a stagiaire at the European Commission, I have been a believer in the European project: I believe that it has been good for Europe and good for the United States. Just as I believe in the United States, I believe in Europe’s ability to compete and win in international trade. Europe needs to believe in itself.
Figlio di una madre veneziana, sono cresciuto orgoglioso del mio patrimonio italiano. Ho vissuto a Roma varie volte e sono sempre tornato spesso in Italia per motivi personali e professionali. J’ai aussi des liens avec la France, ayant commencé ma carrière juridique dans un cabinet franco-américain, d’abord à Bruxelles et puis à Paris. Au Conseil de Securité National à la Maison Blanche, j’étais responsable pas seulement pour les rapports avec les institutions de l’Union Européenne, mais aussi avec la France. Tengo algunos lazos tanbien con España: mi padre fue embajador de EEUU en España y, gracias a su estancia allí, conoci y me casé con una española. Ich habe auch die Gelegenheit gehabt, viel Zeit in Deutschland zu verbringen. Im Sommer 1987 arbeitete ich bei Radio Freies Europa in München und im Herbst 1991 war ich in der juristichen Abteilung der Treuhandanstalt in Berlin tätig.
As the U.S. Ambassador to the European Union, my job is naturally to represent the US and to fight for its interests. But I am also a proud European. I have lived half my life, and I have spent nearly all my career, in Europe. After my internship in the European Commission, I faced a critical decision about whether to start my career in the US or in Europe. Unusually for a US trained lawyer, I decided to start it in Brussels: because of the single market program and the opening up of the EC to the former Soviet bloc, it seemed like a historic time and I wanted to be part of it.
I feel the same sense of historic opportunity today: due to Russia’s illegal annexation of Crimea and Russia’s continuing aggression in Eastern Ukraine which has manufactured a tragic humanitarian crisis, the importance of further European integration and of closer transatlantic cooperation is now more evident than ever. And the urgency of greater European defense spending, a unified European energy policy, and also a Transatlantic Trade and Investment Partnership Agreement is now even more compelling. The transatlantic partnership has deepened at times of crisis, and this time is no different. The only relevant question for us is: will we seize the opportunities? At a time when Russia is supplying troops and equipment to the separatists in Ukraine, and shares responsibility for the killing of European citizens in the skies above Ukraine, it would be appropriate to put peripheral issues into some perspective.
We will have the opportunity to interact a great deal over the next few years. I look forward to a regular, open and honest dialogue. My door is always open to the members of this committee and this Parliament. We will no doubt disagree on some matters, but I hope these disagreements will be about the real, substantive issues – not the peripheral ones that are getting so much attention in the media. I hope our disagreements will be based on an accurate interpretation of our respective policies and interests.
We have a common responsibility to our electorates to lead and to inform. This is particularly true regarding the single most important economic issue that we will have in front of us: T-TIP. No other issue comes close in terms of its potential to promote growth and jobs and to shape the rules on international trade. Understanding the technical issues at stake is difficult and time-consuming, but it is necessary.
There are many compelling geopolitical and economic reasons to conclude an ambitious agreement. I say “ambitious” because we continue to believe, like our Commission colleagues, that only a comprehensive agreement would yield the significant results our leaders want and, at the same time, provide the necessary balance. I know that our friend Vice Minister Carlo Calenda believes that an interim agreement should be considered, but we continue to believe that only a comprehensive agreement will work.
We have a window of opportunity during the next few years to set a standard for future regional and global trade deals that reflect our shared support for rules-based trade, high standards and regulatory transparency and accountability. If we fail, other countries who do not share our values and whose weight in the international trading system is growing fast will set the agenda themselves.
T-TIP’s potential to promote growth and jobs, especially among small and medium-sized enterprises that are the backbone of our economies, fails to attract much attention in Europe, despite Europe’s continuing sluggish economic performance. Both sides of the Atlantic need faster growth and more and better jobs, but let’s face it: Europe needs them even more. How is Europe going to provide its youth a future, its retirees a decent pension and pay for the social protections it wants without growth? While T-TIP by itself is not a solution to the challenge of creating growth and jobs, it is the biggest debt-free stimulus available. Every serious academic study on both sides of the Atlantic concludes that the impact will be significantly positive.
The United States remains fully committed to these negotiations and to an ambitious outcome. The mid-term elections are not affecting our engagement. Yes, Trade Promotion Authority is a critical tool for achieving necessary Congressional support for an eventual agreement, but the absence of TPA is not an impediment to proceeding with negotiations now. We feel confident that we will succeed in getting TPA.
Despite the compelling benefits T-TIP would bring, it has triggered a wave of criticism, often about peripheral issues and in a manner that amounts to scaremongering. To those who are sceptical about this agreement and who refuse to believe the assurances provided by both sides, I would simply say this: we are still in a relatively early stage of the negotiations; do not prejudge the results; wait until we have advanced texts.
One of the myths is that these negotiations are being conducted in secret. As Vital Moreira, the former head of this committee, and Commissioner De Gucht have said: there has never been a less secretive trade negotiation. Just as we are spending a significant amount of time with our Congress and our advisory groups, so is the Commission spending a lot of time with you and its own advisory groups. And as the Commissioner pointed out to this committee a short time ago, it is rather difficult to convince us that we should provide you with more access to negotiating texts than we provide our own members of Congress. We grant them and their designated staff members the opportunity to read our proposals and consolidated texts.
There is an enormous amount of publicly available information, as well as information released in hundreds of briefings, speeches and consultations that each side is conducting with its legislatures, businesses (including small and medium-sized ones) and a very broad range of civil society through many advisory committees. While we are in favour of transparency, we also believe that it has to be balanced against other objectives. Anyone who has negotiated complicated deals – and I have been involved in hundreds – knows that total transparency with third parties makes honest dialogue and compromise almost impossible.
Another persistent myth is that T-TIP is about promoting a deregulatory agenda. This is despite numerous assurances by the President of the United States, the President of the European Commission, and many political leaders and senior negotiators on both sides of the Atlantic that nothing we will do in T-TIP will in any way limit the ability of our governments to regulate in the public interest or reduce the level of health, safety and environmental protections. No, T-TIP will not force European countries to privatize public services, such as public health care, education or utilities; these services are excluded from the GATS and our own free trade agreements.
A related myth is that US standards are lower than those in Europe. That ignores the fact many US standards are in fact often more restrictive than those in Europe. And it ignores that fact that millions of European visitors to the US are happy to eat our food and drive our cars. Our people, our government and our Congress respect the health and safety of the American consumers and value the right to regulate appropriately as much as you do. We don’t want to force European consumers to eat food they reject; rather, we want Europe to follow the advice of its own food safety authority and to give European consumers a choice, rather than to persistently ignore science-based decision making for political ends.
As a former lawyer, I have a particular interest in the debate concerning investor-state dispute settlement, an issue that is frequently misunderstood. You in this committee know that EU member states have signed about 1,400 bilateral investment treaties, nearly all of which contain ISDS provisions. Despite frequent claims to the contrary, we are not seeking to grant businesses the right to claim compensation for an alleged loss of investment value. We believe it is vital to have an appropriate balance between the protection of investment and the right of governments to regulate; we consulted extensively with our stakeholders to achieve such a balance in our own model BIT. We welcomed the Commission’s consultation and look forward to their next steps.
My final point is that both sides should focus on pragmatic, practical positions if we are to reach agreement that promotes the interests of people in both Europe and the United States. We can get a good deal for both sides – but only if we stay focused, respect the facts and keep an open mind.
Let me add a last point related to an issue on your agenda for discussion this afternoon: the Environmental Goods Agreement (the “EGA”) in the WTO. This Agreement aims to eliminate tariffs on a broad set of environmental technologies and present a unique opportunity for WTO members to address a wide range of urgent environmental challenges through trade liberalization. The United States and European Union have demonstrated significant leadership in the WTO on environmental goods for years, and we look forward to continuing to work closely in the context of the EGA negotiations to ensure an environmentally credible and commercially meaningful outcome.
Thank you for your attention.