America's big stick jangles EU nerves; VIEW FROM BRUSSELS

'The EU has chosen multilateralism rather than confrontation, which appears to be the US line'

Press conferences on trade matters in Brussels can sometimes be a little bit, well, boring. Since the Uruguay Round of talks wound up, a lot of the drama has gone out of the topic.

That changed last week when Mickey Kantor, the US Trade Representative, came to Brussels. His performance was enlivened by an unusual public spat with the Japanese ambassador, Tomohiko Kobayashi, who turned up to contest some of Mr Kantor's claims about the Japanese car market.

Mr Kantor, reports one television cameraman, was reduced to screwing up his notes under the lectern as he tried to remain outwardly calm. "You are trying to confuse our friends," he told the ambassador.

The incident shows how the US decision to impose tariffs on luxury cars to protest against obstacles to US exports to Japan of cars and car parts has moved swiftly onto the agenda in Brussels as well as Washington and Tokyo. The European Union is not best pleased with the way that the Americans have handled the issue; and despite parallel European difficulties with the Japanese, the incident has highlighted the differences in the way the US and the EU, under trade commissioner Sir Leon Brittan, choose to handle relations with Japan.

The commission immediately criticised the US moves, saying this was no way to solve trade disputes. "We have worked hard to establish an effective multilateral system. It seems as if what is threatened would be contrary to these rules," Sir Leon said. He argues that the problem should be dealt with multilaterally within the World Trade Organisation.

There are plenty of minor irritants in EU-US trade relations at present. Commissioner Emma Bonino, in charge of humanitarian aid (though better known for her role in the great Canadian fish war earlier this year), criticised the US embargo on Cuba when she was in Washington.

Brussels and Washington are also at odds over EU rules on bananas, which the US says hurt Latin American producers; and over a European ban on imports of fur caught with leg-hold traps.

But none of these is really a showstopper, as diplomats term the irritants that turn into real obstacles to agreement. On substance, Mr Kantor's meetings in Brussels last week seem to have gone rather well, though he cautioned the EU against becoming too inward-looking when it revises its trade rules. Behind the scenes, he and Sir Leon - old protagonists from the final days of the Gatt deal - are cooking up a new trade agreement that would expand commerce between the world's two largest trading partners. Sir Leon has talked cautiously about a free-trade agreement.

So why is the Japanese spat such a problem? First, the EU wants to make sure there is no sweetheart deal between the US and Japan to end the dispute. European carmakers have taken decades to invest in Japan and build up market share, which is five times as big as that of US manufacturers (though still pretty small). They fear that a side-effect of US pressure could be to damage this.

"In practice, it would be the Americans who benefit at the expense of European manufacturers of cars and car parts," Sir Leon said last week. "We would give very serious attention to the possibility of taking any new voluntary plan to the WTO."

There is more than a whiff of hypocrisy about this from the Americans' point of view. They point out that Europe already has a bilateral deal with Japan limiting car imports. The EU defends this by saying it aims at eliminating obstacles in the longer term, creating free trade by the end of 1999.

Second, the EU points out that the new World Trade Organisation is there to pre-empt spats like this. "I am greatly saddened that a partner with whom we have worked so hard to set up the WTO should contemplate such action," Sir Leon said.

Brussels also lobbied hard to get a European - Renato Ruggiero, a former Italian minister - in the top slot at the WTO. It cannot be far from Sir Leon's mind that the US in its present mood might apply aggressive tactics to other trading partners, including Europe.

There is third, longer-term consideration. The EU is attempting to underpin relations with Japan, and the campaign is at an important stage of development. An EU-Japan summit is planned for 19 June in Paris, bringing President Jacques Chirac, commission president Jacques Santer and Japanese prime minister Tomiichi Murayama together just after the Group of Seven industrialised countries meet in Canada. EU foreign ministers met Yohei Kono, their Japanese counterpart, last week in Paris to prepare for the meeting.

The EU likes to think (and likes Japan to think) that it is a more considerate, intelligent and engaged interlocutor than the US. "The European Union has chosen to give priority to multilateralism and to respect WTO rules rather than confrontation, which appears to be the American line," said Herve de Charette, the French foreign inister, after last week's meeting.

It also likes to think that this works. The EU's deficit with Japan was ecu24.5bn (pounds 20bn) last year, down from ecu31bnthe year before. But when Mr Chirac met Mr Kono, he emphasised that this should not be the cause of any confrontation. Rather, the EU will continue with its own track of persuasion.

In an unusual briefing last year, John Richardson, the official in the European Commission in charge of US-Japan trade ties, said the US used "megaphone" diplomacy, which risked provoking "rejectionism" on a much wider front. The Europeans use what they call the trade adjustment mechanism as a framework for talks, and have established a "regulatory dialogue", which is Europe's way of influencing Japan's own internal decisions.

By maintaining its strategy of seeking concessions through negotiation - while the US bangs on the door with the big stick - the EU clearly believes it can maintain closer ties with the Japanese bureaucracy. It also thinks it can get more results.

The next few weeks will determine whether that is really the case - or whether Sir Leon would be better employed finding a stick of his own.

Start your day with The Independent, sign up for daily news emails
A survey carried out by Sainsbury's Finance found 20% of new university students have never washed their own clothes, while 14% cannot even boil an egg
science...and the results are not as pointless as that sounds
politicsIs David Cameron trying to prove he's down with the kids?
Cumberbatch was speaking on US television when he made the comment (Getty)
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Client Services Manager - Relationship Management - London

£30000 - £32000 per annum + benefits : Ashdown Group: A highly successful, int...

Recruitment Genius: Credit Controller / Customer Service

£18000 - £20000 per annum: Recruitment Genius: This rapidly expanding business...

Guru Careers: In-House / Internal Recruiter

£25 - 28k + Bonus: Guru Careers: An In-house / Internal Recruiter is needed to...

Recruitment Genius: Tax Assistant

Negotiable: Recruitment Genius: A Tax Assistant is required to join a leading ...

Day In a Page

Woman who was sent to three Nazi death camps describes how she escaped the gas chamber

Auschwitz liberation 70th anniversary

Woman sent to three Nazi death camps describes surviving gas chamber
DSK, Dodo the Pimp, and the Carlton Hotel

The inside track on France's trial of the year

Dominique Strauss-Kahn, Dodo the Pimp, and the Carlton Hotel:
As provocative now as they ever were

Sarah Kane season

Why her plays are as provocative now as when they were written
Murder of Japanese hostage has grim echoes of a killing in Iraq 11 years ago

Murder of Japanese hostage has grim echoes of another killing

Japanese mood was against what was seen as irresponsible trips to a vicious war zone
Syria crisis: Celebrities call on David Cameron to take more refugees as one young mother tells of torture by Assad regime

Celebrities call on David Cameron to take more Syrian refugees

One young mother tells of torture by Assad regime
The enemy within: People who hear voices in their heads are being encouraged to talk back – with promising results

The enemy within

People who hear voices in their heads are being encouraged to talk back
'In Auschwitz you got used to anything'

'In Auschwitz you got used to anything'

Survivors of the Nazi concentration camp remember its horror, 70 years on
Autumn/winter menswear 2015: The uniforms that make up modern life come to the fore

Autumn/winter menswear 2015

The uniforms that make up modern life come to the fore
'I'm gay, and plan to fight military homophobia'

'I'm gay, and plan to fight military homophobia'

Army general planning to come out
Iraq invasion 2003: The bloody warnings six wise men gave to Tony Blair as he prepared to launch poorly planned campaign

What the six wise men told Tony Blair

Months before the invasion of Iraq in 2003, experts sought to warn the PM about his plans. Here, four of them recall that day
25 years of The Independent on Sunday: The stories, the writers and the changes over the last quarter of a century

25 years of The Independent on Sunday

The stories, the writers and the changes over the last quarter of a century
Homeless Veterans appeal: 'Really caring is a dangerous emotion in this kind of work'

Homeless Veterans appeal

As head of The Soldiers' Charity, Martin Rutledge has to temper compassion with realism. He tells Chris Green how his Army career prepared him
Wu-Tang Clan and The Sexual Objects offer fans a chance to own the only copies of their latest albums

Smash hit go under the hammer

It's nice to pick up a new record once in a while, but the purchasers of two latest releases can go a step further - by buying the only copy
Geeks who rocked the world: Documentary looks back at origins of the computer-games industry

The geeks who rocked the world

A new documentary looks back at origins of the computer-games industry
Belle & Sebastian interview: Stuart Murdoch reveals how the band is taking a new direction

Belle & Sebastian is taking a new direction

Twenty years ago, Belle & Sebastian was a fey indie band from Glasgow. It still is – except today, as prime mover Stuart Murdoch admits, it has a global cult following, from Hollywood to South Korea