Science troubles across the pond

May 24, 2013

— Blossoming U.S. trade agreement with EU facing difficulties.

What seemed at first like a promising free trade agreement with the European Union (EU) has started to feel a bit like a bait and switch. Talks of “comprehensive” free trade only go so far with the EU pushing to maintain its “precautionary principle” with ag imports.

Monday, May 20, 47 different agricultural bodies— including the National Cattlemen’s Beef Association the National Pork Producers Council, and the American Farm Bureau Federation—sent a letter to Michael Froman, deputy national security advisor for International Economic Affairs. The letter expressed extreme concern over the most recent turn of events in the Transatlantic Trade and Investment Partnership (TTIP).

The TTIP is a free trade agreement effort which was officially launched following President Obama’s State of the Union Address in February 2013. The official efforts followed an exploratory period which had started back in the November 2011 U.S.-EU Summit where a committee was tasked with identifying policies and measures to increase U.S.-EU trade, among other things. Since then, there have been a number of meetings held and milestones reached.

The most recent activity of note regarding TTIP involved a resolution regarding the TTIP passed by the European Parliament on April 24. The language of the resolution has many agricultural groups concerned because it strongly expresses the intent of the EU to maintain its “precautionary principle” regarding sanitary-phytosanitary (SPS) issues.

Historically, the EU has used its precautionary SPS stance to refuse imports of U.S. meat from animals treated with hormone implants or growth promotants, as well as a laundry list of genetically modified organisms. Despite World Trade Organization (WTO) requirements that member nations—which both the U.S. and EU are—have science-based SPS, the EU has implemented its precautionary measures based solely on the identification of potential risk with those items it blocks.

The letter suggested the EU’s precautionary measures are swayed more by public opinion and politics before eventually calling the measures what many feel them to be: protectionist trade barriers.

“At the core, the EU’s non-scientific notion of ‘precaution’ has led to the adoption of many trade-restrictive measures that have resulted in several high-profile WTO disputes in which the EU’s defense of the precautionary principle has been ruled to be inconsistent with WTO rules.

Such precautionary measures are often based on mere hazard identification—or worse, on public perception and political considerations—rather than proper, science-based risk assessments, as required by the WTO.

“And, even in cases where risk assessments are ultimately carried out, the EU has demonstrated an inability to lift unjustifiable measures because of domestic political pressures. ‘Precaution’ in the EU has become a pretext for import protectionism under the pretense of consumer safety. As a result, U.S. exports have repeatedly paid the price.”

The resolution’s wording of concern was noted in the letter. The signers called it “unsettling” and made them rethink their earlier enthusiasm over TTIP. Some of the most concerning excerpts are as follows:

“[The EU Parliament] emphasizes the sensitivity of certain fields of negotiations, such as the agricultural sector where the perception of Genetically Modified Organisms, cloning and consumer health is divergent in between the US and the EU; … stresses that the agreement must not undermine the fundamental values of either side, for example the precautionary principle in the EU; calls on the US to lift the import ban on EU beef products as a trust-building measure.”

This latter point specifically drew criticism, albeit couched in subdued diplomatic tones.

“On one hand, the Parliament demands that the European Commission defend arbitrary and unjustifiable SPS barriers and the precautionary principle on which they were based, yet, on the other hand, it calls on the United States to lift its ban on EU beef, which resulted from the BSE crisis,” read the letter’s response to that particular section.

NCBA’s associate director of legislative affairs, Kent Bacus, heralded the TTIP efforts as a boon to U.S. beef, but was concerned about the EU resolution as well.

“The U.S. beef industry has a longstanding history of providing the E.U. with high quality U.S. beef and we look forward to improving that relationship through the TTIP. Unfortunately, there are fundamental differences between the U.S. and the E.U. regarding the use of science and technology in food production.

“Production practices in the U.S. are based on rigorous scientific review and are continuously improved to employ the latest advancements in scientific research and animal husbandry, with the overall goal of improving production efficiency while improving the overall environmental impact.”

He called the EU’s precautionary principle a discouragement to the development and use of scientific advancement and called U.S. beef the victim of unnecessary trade barriers.

“For the benefit of both the U.S. and the E.U., we must set parochial interests aside and establish a twenty-first century agreement based on internationally-recognized scientific standards, free from tariffs, quotas, and subsidies, where the free market allows competition to flourish and encourage sustainable trade,” Bacus said.

“If the U.S. and E.U. truly want to establish a stronger trade relationship, science based and market driven agriculture policies must be part of the final trade agreement.”

The coalition of 47 agricultural groups which drafted and signed the letter said the EU’s non-science-based SPS issues must be addressed as part of the TTIP negotiations. This is opposed to leaving some elements of the trade negotiation to “some future consultative mechanism” as has been recommended by members of the EU Parliament.

“If selected sectors or measures are excluded from the TTIP, or placed into a ‘future negotiation’ category, the TTIP will fall short of achieving the Administration’s goal for it to be a high-class 21st Century agreement, and it will likely fail to win the overall support of the food and agricultural sector that will be needed to ensure final passage of this agreement.”

The coalition suggested the TTIP negotiations be modeled on the Trans-Pacific Partnership (TPP) negotiating structure. TTP has been a very beneficial trade arrangement for the U.S. and specifically U.S. beef as the desire of many Asian countries to become members has opened up previously closed beef export markets.

“The TPP is intended to be a comprehensive agreement, covering all sectors without exceptions,” the letter explained. “All topics are to be concluded as a ‘single undertaking,’ which means that nothing is agreed to until everything is agreed to; and there is to be an SPS chapter with strong and enforceable WTO-plus disciplines.”

Currently, beef trade with the EU is relatively limited compared to what it could be. A recent move as a result of a 2009 memorandum between the U.S. and the EU allowed the U.S. to compete for a quota of 45,000 metric tons of duty free beef from non-hormone treated cattle exports in 2012. According to USDA statistics, European consumers bought $236 million of U.S. beef. The potential of freer trade and reduced SPS-related trade barriers would go a long way to expanding the potential market for beef in the EU. — Kerry Halladay, WLJ Editor