French cultural concerns could clog up the world’s biggest free trade agreement
Paris entered Friday's meeting of EU trade ministers, saying it won’t let talks over the EU- US free trade pact, kick off during the G8 meeting scheduled for June 18 -19, until audio-visual issues are made a “cultural exception”.
“We’ll say no,” the Financial Times (FT) quotes Nicole Bricq, France’s trade minister as saying. “There will be a political blockage, a veto if you want to call it that . . . The ball is in the commission’s court. They went too far, too fast. They put themselves in a bind, now they have to get themselves out of it.”
France insisted that state subsidies and restrictive quotas for movies and TV shows should remain unchanged. The main fear for Paris is that removing trade limitations in the sector would add to existing imbalances. The US now sells far more movies, music and video to the EU than it buys from the bloc. The US share of European cinema screens is estimated at 60%, which compares to about 3-6% that Europe has in the US. Digital and internet services in Europe are also dominated by the US companies.
However, "there is nothing that threatens the French or the European film industry and I shall certainly continue to watch all of my beloved French movies even after this free trade negotiation" said Alexander Stubb, Finland's Minister for Europe and Foreign Trade, talking to Reuters.
A trade deal, called the Transatlantic Trade and Investment Partnership (TTIP), would mark the world’s biggest trade agreement. It could make the world’s economic powerhouses even bigger, boosting annual output of the EU by 119 billion euros ($159 billion) and of the US by 95 billion euros according to an EU-commissioned study.
“An EU-US agreement could potentially represent 400,000 jobs in the EU, so that’s a prize really worth working for,” the Washington Post quotes Irish Enterprise Minister Richard Bruton.
Eliminating tariffs between the EU and the US could also boost exports on both sides by about 17 percent a year. Although the existing tariffs are already relatively low, averaging 5 percent to 7 percent, such a huge effect would be due to the sheer size of the market – bilateral trade is estimated at $1 trillion a year.
All this makes the deal essential for everybody, especially when most of Europe is struggling in a recession, say free-trade advocates.
Proponents of the deal including Germany and the Great Britain also fear that the exception asked by France would trigger a similar US opt-out for their shipping sector. The industry is now a big concern for Denmark and Greece that have large capacity there.
"In the maritime area, the agreement would make it easier for Danish shippers to sail into the USA. That is a vital element," Danish Trade Minister Pia Olsen Dyh said talking to Reuters.