The US-EU Business and Technology Council: Seven Steps to Success
As the first formal meeting of the US-EU Trade and Technology Council (TTC) kicks off on September 29, the key question should be: what will it take for the TTC to be successful? ? How can the TTC avoid the fate of so many official transatlantic boards and forums – from the Transatlantic Economic Council to the much maligned Transatlantic Trade and Investment Partnership – that have become unnecessary?
The reasons for these failures vary, from a lack of interest from executives to really complex regulatory issues, such as pharmaceutical testing or the definition of subsidies. In most cases, these dialogues ended not with a bang, but with a whimper – no dramatic walkouts or explosive one-sided statements, but rather a simple failure to come together.
If the TTC is to avoid the same form of negligent homicide, it must lay the groundwork for future success in Pittsburgh. Leaders will leave this first TTC either wondering why they bothered to attend, or excited about the job ahead and looking forward to their next meeting.
Announced at the US-EU summit in June, the TTC was a symbol of the renewed US and EU engagement in their partnership. But it also aimed to demonstrate the interdependence of the world’s two largest market economies, as well as serve as a forum for building greater cooperation across the Atlantic on regulatory and market issues.
Making the TTC a success will not be easy. US President Joe Biden came to power determined to mend the transatlantic partnership, with particular emphasis on building better relations with the European Union, but there has been little success to date. The administration has not lifted Trump-era tariffs on steel and aluminum, and the US and EU have not resolved a dispute over data transfers. Moreover, the failure of the United States to consult its allies on its withdrawal from Afghanistan has left many European policymakers concerned that Biden’s “foreign policy for the middle class” is really just a rehash of “America First” from former President Donald Trump.
As a result, Europe remains skeptical of the United States as a benevolent and predictable ally, and key European leaders speak openly about the need for strategic autonomy. In the last week before Pittsburgh, the announcement of AUKUS caused a serious split with France, leading EU Internal Market Commissioner Thierry Breton to question whether the TTC should move forward, as it believes US-European relations may need a “pause and a reset.”
Despite these challenges, the TTC offers the best opportunity to show that the United States and the European Union can take concrete steps towards true cooperation on technology and trade and demonstrate that their relationship is based on a meaningful partnership. Here are seven steps the TTC must take to be successful:
- Commit to further engagement. Above all, the TTC must earn the commitment of the leaders of the United States and the EU for its future. The continued engagement of the five Co-Chairs — European Commission Executive Vice-President Margrethe Vestager, European Commission Executive Vice-President Valdis Dombrovskis, US Secretary of State Antony Blinken, US Secretary of Commerce Gina Raimondo and the US Trade Representative Katherine Tai be essential to make it more than just a one-off meeting. One of the most important announcements in Pittsburgh might just be the date and location of the next meeting. Let us hope that the future French presidency of the EU will mobilize to host the next session in the first half of 2022, despite the busy environment before Pittsburgh. Using the rotating presidency can even increase the commitment of EU member states to the TTC.
- Develop a shared vision of the TTC. American and European leaders must leave Pittsburgh with the confidence that they have developed a cohesive and shared vision of what the TTC should be, as well as its goals and priorities. For the United States, this will mean giving up the idea that the TTC is above all a rallying ground for allies against China. For Europeans, this will mean accepting that external views have some relevance to their current digital agenda. The EU has every right to regulate the technology as it sees fit, but if there is nothing more to discuss, the US side will not find the TTC very useful. Likewise, if the United States simply wants to use the TTC against China, EU officials are unlikely to be eager for a return commitment.
- Identify the objectives of the TTC (hint: not dispute resolution). Is the TTC intended to resolve long-standing disputes or establish cooperation in new areas? In recent months, the US and the EU have moved difficult disputes – Airbus-Boeing, data transfers and steel and aluminum tariffs – to separate tracks where they can be negotiated. experts. TTC leaders can play a role in pushing negotiators to make a deal and then blessing the results. But leaders can’t devote enough time or focus to resolving disputes, especially those that have been brewing for some time. Instead, the strength of the TTC lies in its role as a vessel for cooperation between the US and the EU. For this reason, the goal of the Pittsburgh meeting should be to build and demonstrate this cooperation.
- Launch serious efforts to develop shared standards and processes. This first meeting of the CTT should aim to launch some specific efforts aimed at building a concrete collaboration. Early reports indicate that the Pittsburgh TTC will seek deals on supply chains (especially semiconductors), investment screening and export controls. Since discussions on these topics only really started in the summer, this first TTC should only result in very modest agreements even on these relatively uncontroversial topics. Executives could promise to share more information on foreign investment cases. They will undoubtedly commit to cooperating in building resilient supply chains and consulting more on export controls. But to go beyond these vague promises, the TTC should launch some efforts to develop common approaches to standards and processes; for example, common cybersecurity standards, a common approach to facial recognition technology, or a common methodology for assessing mergers affecting the digital economy. As a first step, the US and the EU must first compare perspectives and political approaches before trying to forge specific agreements. This is especially important given the significant mismatch between current EU and US policy positions: while the EU has spent the past year launching legislative proposals on a range of digital issues, the Biden administration still struggles to get officials to their posts and develop an approach.
- Establish a clear process linking leaders to TTC working groups. Achieving any of these goals will take time and expertise. But the TTC is not just the leaders; TTC working groups provide an invaluable framework for dealing with detailed technical issues. Leaders should task the working groups with realistic but concrete goals expected before the next meeting. Too often, ministerial-level meetings only lead to vague statements or assignments that are overlooked because officials assume the next meeting is in a full (or even uncertain) year. By setting a meeting schedule at least twice a year and having task forces develop concrete plans for collaboration, the TTC can begin to advance the trade and technology agenda between the US and the EU.
- Build effective stakeholder outreach, including with the US Congress and the European Parliament. The TTC will only be truly successful if it develops an effective stakeholder awareness mechanism. The European Parliament and the United States Congress should be consulted as lawmakers who can either support or hinder TTC results, especially results requiring changes in laws and regulations. The European Commission and the US executive are often reluctant to include Parliament and Congress, but the TTC – at its second meeting, if not in Pittsburgh – should provide a platform for lawmakers to communicate their points of view to leaders.
- Reach out to business and non-governmental organizations (NGOs) stakeholders. The TTC stakeholder process must extend beyond legislators to business and NGO representatives, essential elements of any policy and regulatory process. Leaders need to do more than just report to stakeholders after the meeting; the companies and NGOs concerned should have a method for engaging in the working group process, especially since this is where most of the key technical choices will be made. There should also be a formal component to the leadership meeting that presents the views of business and NGO stakeholders. The TTC should encourage stakeholders to reach across the Atlantic to develop initiatives that can be jointly proposed to leaders.
The TTC is intended to address complex issues that affect economies and regulatory regimes on both sides of the Atlantic. Building cooperation on such issues will not be easy, even between allies and friends. This first meeting will inevitably be criticized for being more talk than action. But in Pittsburgh, the TTC has the chance to prove its critics wrong.
Frances G. Burwell is a Distinguished Fellow of the Atlantic Council and Senior Director of McLarty Associates.