Handelsblatt Exclusive: No TTIP Deal This Year

The German economics ministry is pouring cold water on the idea that a trans-Atlantic free-trade deal can be reached by the end of this year, Handelsblatt has learned, despite Chancellor Merkel’s insistence to the contrary.

By Klaus Strattman and cross-posted from Bilaterals.org

The German economics ministry is pouring cold water on the idea that a trans-Atlantic free-trade deal can be reached by the end of this year, Handelsblatt has learned, despite Chancellor Merkel’s insistence to the contrary.

German Chancellor Angela Merkel and U.S. President Barack Obama’s goal of ironing out a trade agreement between the United States and the European Union by the end of the year has “no basis” in reality, according to Handelsblatt’s sources in the German economics ministry.

Negotiators in Brussels and Washington haven’t finalized a single chapter of the Transatlantic Trade and Investment Partnership, or TTIP, according to an internal ministry report obtained by Handelsblatt.

Europeans and Americans have “fundamentally different views” on a whole host of questions and entire issue areas haven’t even been addressed yet, according to the report.

So far, there hasn’t been an agreement on one of the 27 to 30 chapters that could comprise a TTIP treaty in the end.

One of the main sticking points has been “Buy America” clauses that block European companies from participating in the bidding process for some U.S. government contracts.

The refusal by the United States to compromise and open its public procurement process to more European competition has been the “biggest hurdle” in the negotiations, according to the report.

Negotiators also haven’t come any closer to an agreement on what type of tribunals should adjudicate disputes between investors and governments. The United States has pushed for private tribunals called investor-state dispute settlement courts.

Though such tribunals are a common feature of modern trade agreements, the European Union views them as a threat to democratic sovereignty and has proposed a permanent public court that would include an appeals system. The U.S. side has rejected the E.U. alternative as unacceptable.

Negotiations on country-of-origin labels and customs on agricultural products have also proven “particularly difficult,” according to the report.

“Fourteen rounds of negotiations have taken place,” the authors of the report wrote. “So far, there hasn’t been an agreement on one of the 27 to 30 chapters that could comprise a TTIP treaty in the end.”

Though the negotiators have drafted a number of so-called “consolidated texts,” these documents represent nothing more than the “written offers” of each side. The consolidated texts have “no bearing on the possibility of an agreement on content.”

Given the backlog, negotiators can’t expect to achieve in three months what they’ve been unable to achieve in three years of talks, said Handelsblatt’s sources in the economics ministry

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