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Why transatlantic trade deal faces stiffening wind from Europe

With elections looming around Europe, some politicians are calling for fresh trade talks as public concerns grow that TTIP puts corporate interests above citizens' rights.

A demonstrator bangs a pot during a July 12, 2016 protest outside a congress center in Brussels, Belgium, where negotiators worked on the Transatlantic Trade and Investment Partnership.

Francois Lenoir/Reuters

September 1, 2016

A sudden chorus of criticism from European leaders seems likely to doom President Barack Obama鈥檚 hopes of signing a flagship transatlantic trade deal before the end of his term of office.

The European Commission, negotiating with Washington on behalf of the 28 EU members, appears unmoved by criticism of the Transatlantic Trade and Investment Partnership (TTIP). 鈥淭he ball is rolling right now and the Commission is making steady progress,鈥 spokeswoman Margaritis Schinas told journalists this week. 鈥淭he Commission stands ready to close this deal by the end of the year.鈥

But that seems like wishful thinking to most observers. The two sides are still far from agreement on a host of issues, and European public opinion is turning against the deal over fears that it puts corporate interests above citizens鈥 rights.

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Now, with elections looming, politicians around the continent are having second thoughts about TTIP, and some are calling for fresh talks on a new agreement that would meet their citizens鈥 concerns about consumer protections.

鈥淭here is no political support in Paris鈥 for the current negotiations, French Secretary of State for Trade Matthias Fekl said Tuesday. 鈥淲e need a clear and definitive halt so as to later restart discussions on a proper basis.鈥

Austrian Economy Minister Reinhold Mitterlehner echoed his call Wednesday, saying 鈥渙ne should stop the negotiations now and start the entire process afresh.鈥 Earlier in the week the German Economy Minister Sigmar Gabriel had declared that the talks between the European Union and the US 鈥渉ave de facto failed, though nobody is really admitting it.鈥

With elections due over the next 12 months in the United States, France, and Germany, 鈥渢he power of the antiglobalization, antitrade lobby is so great that it would be very hard for any politician to make the case for TTIP,鈥 says Xenia Wickett, head of the US and Americas program at Chatham House, a London-based think tank.

鈥淭he likelihood of TTIP moving forward in any meaningful way in the next two years is very low,鈥 Ms. Wickett adds.

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'Proxy for corporate greed'

TTIP talks launched in 2013, designed to create the biggest ever free-trade deal, covering 800 million people. Negotiators are making an ambitious bid to go beyond tariffs and harmonize rules and regulations that can complicate commerce.

That has raised hackles in Europe, where TTIP critics are warning that negotiators are willing to sacrifice social, labor, and environmental concerns in a lowering of standards that will benefit only big business.

There is a fear that 鈥渁nything done to boost trade will favor corporations and private markets, treating them better than customers,鈥 explains Laura von Daniels, an analyst at the German Institute for International and Security Affairs in Berlin.

鈥淭TIP is a proxy for corporate greed,鈥 says Mark Dearn, a trade campaigner with the British antipoverty group War on Want. 鈥淏ut society is very geared up to fight it. It has generated the biggest social movement for a generation.鈥

Calls for a 'new initiative'

More than 150,000 people demonstrated in Berlin against TTIP last year; another mass demonstration is planned for later this month. EU opinion pollsters have found public support for the treaty is slipping, and stands now at 53 percent.

In the United States the unpopularity of trade deals is such that neither leading presidential candidate supports the Trans Pacific Partnership (TPP), an Asia-oriented deal similar to the TTIP.

In Europe the protests have prompted some officials to propose new negotiations that would assuage their voters鈥 concerns about environmental standards, food safety, and consumer rights.

鈥淲e have to fix the best possible rules governing energy, health, public services and culture,鈥 Mr. Fekl, the聽French trade secretary, told RMC radio Tuesday. 鈥淭his is not the direction the negotiations have taken and they should end now.鈥

The headwinds battering the TTIP are so strong, says Ms. Von Daniels, that 鈥淚 am not sure reframing the talks would be enough. There would have to be a new initiative, and maybe France and Germany could be the drivers of a new approach to trade liberalization.鈥

TTIP not dead yet

Whether the US would be ready to countenance such a new approach is unclear. President Obama鈥檚 top trade negotiator, Mike Froman, is due in Brussels later this month to continue TTIP talks as normal with the European Commission.

But TTIP has a timetable problem in Washington; the TPP, a finished treaty, has to go through Congress first, and it is currently stuck in the legislative process.

Whether or not the transatlantic trade deal goes into the deep freeze, however, even its fiercest opponents do not think it is dead. 鈥淭TIP will keep coming back unless we do away with the political and economic system that produced it,鈥 which is not likely in the short term, says War on Want鈥檚 Mr. Dearn.

After next year鈥檚 elections, 鈥渋t all changes,鈥 suggests Wickett. 鈥淕overnments will have four or five years, which gives time to make a case鈥 for a deal.

鈥淚 don鈥檛 think TTIP will die,鈥 says Jean Four茅, an expert on international economics at CEPII, a research center in Paris. 鈥淚t is not impossible that with new governments in the US, Germany, and France, the discussions could start again. But what form the negotiations might take, and whether they would end in a free trade agreement, I don鈥檛 know.鈥