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
Voices
There will be a chance to bid for a rare example of the SAS Diary, collated by a former member of the regiment in the aftermath of World War II but only published – in a limited run of just 5,000 – in 2011
charity appealTime is running out to secure your favourite lot as our auction closes at 2pm tomorrow
Arts and Entertainment
Mark Wright has won The Apprentice 2014
tvThe Apprentice 2014 final
News
File: James Woods attends the 52nd New York Film Festival at Walter Reade Theater on September 27, 2014
peopleActor was tweeting in wake of NYPD police shooting
Arts and Entertainment
X Factor winner Ben Haenow has scored his first Christmas number one
music
PROMOTED VIDEO
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Sport
Martin Skrtel heads in the dramatic equaliser
SPORTLiverpool vs Arsenal match report: Bandaged Martin Skrtel heads home in the 97th-minute
News
Detective Tam Bui works for the Toronto Police force
news
News
The monkey made several attempts to revive his friend before he regained consciousness
video
Extras
indybest
Arts and Entertainment
Darrell Banks’s ‘Open The Door To Your Heart’
music
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

Carlton Senior Appointments: Private Banking Manager - Intl Bank - Los Angeles

$200 - $350 per annum: Carlton Senior Appointments: Managing Producer – Office...

Carlton Senior Appointments: San Fran - Investment Advisor – Ind Advisory Firm

$125 - $225 per annum: Carlton Senior Appointments: San Fran - Investment Advi...

Sheridan Maine: Commercial Finance Manager

Up to £70,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...

Sheridan Maine: Regulatory Reporting Accountant

Up to £65,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...

Day In a Page

The week Hollywood got scared and had to grow up a bit

The week Hollywood got scared and had to grow up a bit

Sony suffered a chorus of disapproval after it withdrew 'The Interview', but it's not too late for it to take a stand, says Joan Smith
From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?

Panto dames: before and after

From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?
Thirties murder mystery novel is surprise runaway Christmas hit

Thirties murder mystery novel is surprise runaway Christmas hit

Booksellers say readers are turning away from dark modern thrillers and back to the golden age of crime writing
Anne-Marie Huby: 'Charities deserve the best,' says founder of JustGiving

Anne-Marie Huby: 'Charities deserve the best'

Ten million of us have used the JustGiving website to donate to good causes. Its co-founder says that being dynamic is as important as being kind
The botanist who hunts for giant trees at Kew Gardens

The man who hunts giants

A Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there
The 12 ways of Christmas: Spare a thought for those who will be working to keep others safe during the festive season

The 12 ways of Christmas

We speak to a dozen people who will be working to keep others safe, happy and healthy over the holidays
Birdwatching men have a lot in common with their feathered friends, new study shows

The male exhibits strange behaviour

A new study shows that birdwatching men have a lot in common with their feathered friends...
Diaries of Evelyn Waugh, Virginia Woolf and Noël Coward reveal how they coped with the December blues

Famous diaries: Christmas week in history

Noël Coward parties into the night, Alan Clark bemoans the cost of servants, Evelyn Waugh ponders his drinking…
From noble to narky, the fall of the open letter

From noble to narky, the fall of the open letter

The great tradition of St Paul and Zola reached its nadir with a hungry worker's rant to Russell Brand, says DJ Taylor
A Christmas ghost story by Alison Moore: A prodigal daughter has a breakthrough

A Christmas ghost story by Alison Moore

The story was published earlier this month in 'Poor Souls' Light: Seven Curious Tales'
Marian Keyes: The author on her pre-approved Christmas, true love's parking implications and living in the moment

Marian Keyes

The author on her pre-approved Christmas, true love's parking implications and living in the moment
Bill Granger recipes: Our chef creates an Italian-inspired fish feast for Christmas Eve

Bill Granger's Christmas Eve fish feast

Bill's Italian friends introduced him to the Roman Catholic custom of a lavish fish supper on Christmas Eve. Here, he gives the tradition his own spin…
Liverpool vs Arsenal: Brendan Rodgers is fighting for his reputation

Rodgers fights for his reputation

Liverpool manager tries to stay on his feet despite waves of criticism
Amir Khan: 'The Taliban can threaten me but I must speak out... innocent kids, killed over nothing. It’s sick in the mind'

Amir Khan attacks the Taliban

'They can threaten me but I must speak out... innocent kids, killed over nothing. It’s sick in the mind'
Michael Calvin: Sepp Blatter is my man of the year in sport. Bring on 2015, quick

Michael Calvin's Last Word

Sepp Blatter is my man of the year in sport. Bring on 2015, quick