When President Joe Biden visits Brussels this month, the European Union and the United States will commit to trying to end the trade disputes that have plagued transatlantic relations while also committing to work together to overcome the COVID-19 pandemic.
Allies will aim to resolve a long-standing air dispute by July 11, achieve global consensus on a new tax system by mid-2021, and remove punitive tariffs on steel and steel exports. ‘aluminum by the end of the year, according to a copy of a draft statement obtained by Bloomberg.
The EU wants to reset its relations with the United States, which have deteriorated over the past four years when the Trump administration undermined multilateral organizations such as the World Trade Organization, has left the Paris Agreement for limit global warming and hit the 27-nation bloc with tariffs on metals. in the name of national security.
“Recognizing the importance of the EU-US partnership as an anchor for peace, security and stability in the world, we commit to join forces to prevent and peacefully resolve conflicts, to defend rule of law and international law and promote human rights for all, gender equality and the empowerment of women and girls ”, according to the declaration drafted by the EU.
A White House National Security Council spokeswoman declined to comment.
The EU-US summit will take place in Brussels on June 15 and will coincide with Biden’s first trip to Europe since becoming president. The draft points are the subject of ongoing discussions and are already being changed, according to two people familiar with the matter.
Efforts to build consensus on global tax issues come as the world’s largest economies question where to tax businesses in the digital age and how to apply a minimum tax rate to multinationals. Group of Seven finance ministers will discuss the issue this week, and European governments are increasingly optimistic about a breakthrough.
The EU and the US will also redouble their efforts to end two separate trade disputes: a 17-year struggle for illegal government aid to Chicago-based Airbus and Boeing and a metals dispute in which the US United have imposed levies on steel and aluminum imports. , citing national security concerns, leading to retaliation from the EU. Both sides have sought to defuse the issues in recent months in an effort to ease the path to a resolution.
The draft also indicates a possible WTO proposal to reduce state support to industries as part of a joint effort to limit China’s excessive subsidies to its private companies. If the talks result in a broad coalition of countries, it could become the most significant attempt to rewrite WTO rules in more than two decades.
The draft document also suggests that the EU will seek to align more closely with the US over China; calls for the creation of a Trade and Technology Council which will stimulate trade and investment in critical technologies; proposes the creation of a joint working group on Covid vaccines to collaborate in the fight against the pandemic on a global scale; and is committed to working together on foreign policy issues.
The statement notes the similarity of the two sides’ multidimensional approach to China, stressing the need to address both challenges and areas of cooperation with Beijing. It also underlines the intention to develop a digital governance system that protects critical technologies and is based on shared rules and values, including human rights.
The EU and the US are also expected to agree on closer cooperation to promote greater efforts to cut emissions ahead of a key round of UN climate talks in Glasgow in November. This includes accelerating the green transition in the poorest countries and a commitment to step up efforts to reach the goal of securing $ 100 billion per year in climate finance.
Discouraging investments in fossil fuels and calling for a phasing out of coal in power generation is also part of the draft declaration, as is the vow to work together on ‘carbon pricing, including risk reduction. carbon leakage, and on sustainable finance. “
To avoid carbon leakage or the relocation of companies to regions where climate policies are more lax, the EU is considering introducing a tax on imports of certain emissions-intensive goods. A bill on the so-called carbon border adjustment mechanism is due to be unveiled on July 14 as part of a wider package of measures to adjust the EU economy to a stricter climate target for 2030.
Biden embraced the idea of carbon adjustment fees or quotas during his presidential campaign. According to the Office of the US Trade Representative, “carbon border adjustments” are part of “trade and regulatory approaches” being considered to tackle greenhouse gas emissions.
The draft also mentions a recent G-7 agreement to immediately end funding for new coal infrastructure abroad.