Mending Fences

Mending Fences

Copyright 2003, Traffic World, Inc.

Help is on the way for the bruised transatlantic alliance. The Transatlantic Business Dialogue, a forum spearheaded by chief executive officers from Europe and the United States, is being revived with a new structure and a revamped agenda.

There are a number of reasons why such initiatives are important for companies involved in international trade. First, there is the weighty Europe-U.S. relationship. Together these major trading powers account for an estimated 37 percent of the global trade in goods. According to the TABD, roughly half of all American foreign investment over the past decade has gone to Europe. European firms account for more than two-thirds of total foreign assets in the United States. Of the 6.4 million Americans employed by foreign firms in the United States, European firms employ nearly 70 percent. In Europe, U.S. firms employ 4.1 million people.

Moreover, in this age of globalization, trade talks no longer are the preserve of government negotiators and academics. Companies have a direct interest in the deals struck by governments as they plot global expansion strategies and strive to meet increasingly complex trade compliance regulations.

TABD provides an informal process whereby European and American companies and business associations, working together with the European Commission and the U.S. administration, can develop joint EU-U.S. trade policy recommendations.

Created by the Clinton administration in the mid-1990s, TABD lost steam over recent years for a number of reasons. The arrival of a new name in the White House is one. "When the Bush administration came in, they saw this as a Clinton project. They supported the process but there was no visible announcement by the president," said TABD Executive Director Jeff Werner.

After a number of early wins, the organization became "a victim of its own success," said Werner. It became top-heavy with issues requiring member CEOs to wade through the minutiae of trade problems. It also fell victim to changing times. Werner pointed out that in the 1990s CEOs were "rock stars" and the TABD attracted 120 to its annual meeting in Berlin in 1999. That number dwindled as CEOs fell from grace and became preoccupied with an economic downturn.

Last year the forum was ready to fold if respective governments were unwilling to support it. "We gave them an exit strategy," said Werner. The Europeans responded quickly and wanted to revitalize the TABD. The Department of Commerce took longer to decide, said Werner, but finally concurred.

On June 24, just prior to the annual EU-U.S. summit, a group of 18 CEOs met with senior level officials from the Bush administration and European Commission to discuss the transatlantic trade relationship. "There was an open and frank discussion about it," said Werner. This was the starting point of the revived forum, he said.

Some time over the next few weeks the two joint leaders will be announced. The last ones were Phil Condit, chairman and CEO of the Boeing Co., and Sir Charles Masefield, vice chairman of BAE Systems. A new structure will be introduced over the next six months. The main mission, to promote transatlantic trade and give business an opportunity to influence the trade negotiation process, will be unaltered but a more streamlined organization should emerge, Werner said.

The broad trade issues that affect transatlantic business will be boiled down to two or three for member CEOs, he explained. At another level, expert groups will tackle more specific questions. The new agenda still is being mapped out but key issues are likely to include trade liberalization and tariff reductions, and a European directive on the chemical industry that could bring sweeping changes to the chemicals business.

The next TABD annual meeting has not been announced yet, but is likely to be in Europe in May or June 2004, Werner said.