EU Slams Container Security Initiative

The European Union highlighted the Container Security Initiative in its latest annual report on U.S. trade and investment barriers.

The CSI screening and related additional U.S. customs routines are causing significant additional costs and delays to shipments of European machinery and electrical equipment to the United States, according to the 2009 report.

"This burden is so severe that a number of small European engineering companies have decided not to export to the U.S. any longer," the report says.

The EU also raised concern over the so-called SAFE Port Act which foresees the establishment of a pilot program at some foreign ports to test integrated non-intrusive imaging and radiation detection scanning equipment for all U.S.-bound containers.

"This pilot programme goes against a modern customs approach of multi-layered risk based controls through effective targeting followed by scanning and/or inspection where necessary and may slow down traffic in ports," the EU said in the report.

The EU reiterated its criticism of the Jones Act which restricts U.S. coastal trade to U.S.-built vessels. The report also highlighted the "significant" level of subsidies to U.S. shipbuilding and aircraft engine manufacturers.

The report claims "on-going largest scale aid for [U.S.] airlines represents a significant protection from commercial pressures also faced by foreign carriers and is an impediment to air trade on transatlantic routes."

The European Commission, the EU's executive, stressed that only a small proportion of EU-U.S. trade is affected by trade disputes.

"But raising and addressing these issues helps to boost confidence in the transatlantic market place and allows exporters to reap the full benefits available," it said.

The EU and the United States are the largest bilateral trading partnership, accounting for 33 percent of world trade in goods and 44 percent of trade in services.

The EU had an $89 billion surplus in merchandise trade with the United States in 2008 and a $15.6 billion surplus in services.

Contact Bruce Barnard at brucebarnard47@hotmail.com.