Cantillon: US-UK trade pact talks remain challenging

As Barack Obama touched down in London this week, all eyes were on the US president’s comments on the forthcoming British referendum on EU membership.

But the visit of the outgoing US president to Europe is also expected to give some much-needed momentum to TTIP – the Transatlantic Trade and Investment Partnership – as the EU-US trade accord under negotiation is commonly known.

In what is expected to be his last official visit to Europe as president, Obama will meet German chancellor Angela Merkel on Saturday in Hanover, where he will be joined by the French, Italian and British prime ministers.

While Syria and Libya are expected to top the agenda, discussion of the EU-US trade deal is also expected.

Almost three years since the EU gave the green light for a transatlantic trade deal, negotiations on an ambitious trade pact between the world’s two largest economic blocs remain challenging. Both sides are pushing to secure agreement by the end of Obama’s term. The strong strain of protectionism that has surfaced in the US presidential campaign does not bode well for TTIP, while Obama is facing a challenge in even getting the recently agreed US-Pacific trade deal (TPP) through Congress.

Both sides reported good progress during the latest round of negotiations in February, with the 13th round due to start in New York next Monday. Progress was made on issues such as streamlining of regulation, but a number of outstanding issues remain unresolved, such as the opening up of procurement services.

But apart from the complex details of the negotiations, perhaps more worrying is the political climate. A survey by German foundation Bertelsmann on Thursday found that public support for the deal in the US and Germany has plummeted. Fewer than 20 per cent of respondents in both countries now actively support the deal, compared to more than 50 per cent in 2014.

Whether the political will exists to secure an agreement on a trade pact that is being viewed with increasing public scepticism will be a key question for both sides in the coming months.