Greater cooperation urged between UK, US and EU

The Treasury said today that Britain, Europe and the US stand to gain substantially from transatlantic trade liberalisation, according to two studies published today.

The studies, 'Enhancing Economic Cooperation between the EU' and 'The Americas: An Economic Assessment', commissioned jointly with the Dutch Ministry of Finance, suggest that the EU could gain over €100 billion per annum through liberalisation of the EU-US trade relationship. The gains for the US could be as much as $75 billion per year.

The studies also highlight the new challenges to transatlantic trade - in particular, arguing that the EU and US should consider strengthening regulatory dialogue and cooperation, to help prevent 'non-tariff' barriers, such as domestic regulation, becoming an increasing source of trade disputes.

Chancellor Gordon Brown said: "The new debate about Europe's future is no longer - as it was in the 1980s - how a single trade bloc organises its internal markets, independent of the rest of the world, but how all of Europe, thinking globally, can be outward looking, meet global competition and reform to do so - and thus benefit from global change.

"Instead, Europe and America should patch up their trade differences, move beyond the day-to-day issues and make a greater effort to tackle the barriers to a fully open trading and investment relationship, strengthen joint arrangements to tackle competition issues and engage in dialogue about the approach to financial services regulation."

In the last 10 years, Europe's trade with the rest of the world has increased faster than output. During that time European investment in America has increased 10-fold to around $250 billion. In recent years, more European capital has been invested annually in America than US capital in Europe.

The transatlantic economic relationship accounts for up to $2.5 trillion of commercial transactions each year, including $500 billions of foreign trade, and provides employment to over 12 million people.

The Chancellor said that as a first step the US administration and the EU Commission should work with the UK and other member states to analyse the benefits of greater trade and investment liberalisation.

He added: "I call on the US administration, the European Commission and Greece, as holders of the EU Presidency, to use this summer's EU-US summit to make a significant commitment to the success of this year's WTO meeting in Cancun."

The Chancellor also called for improved regulatory dialogue between the EU and US authorities to improve regulatory issues.

(GMcG)