The EU and the US have for a long time been behaving like reluctant lovers: flirting, and bickering, but never willing to go the distance. Despite many shared interests, a full-blown free-trade agreement has always proved one step too far.
The European Parliament has done its best to play matchmaker. As recently as November, MEPs adopted a resolution calling for talks on a possible trade agreement, while the EP's president promoted such a deal when he met US vice-president Joe Biden during his visit to Washington in December.
This hard work has now paid off with US president Barack Obama announcing the start of negotiations in his State of the Union address in February. Negotiations are expected to take about two years and any deal will have to be approved by the European Parliament.
MEPs have long pushed for an EU-US trade accord because of the two regions' shared economic interests and the employment and growth it would help to generate. Already the EU and the US enjoy the world's largest economic relationship with a trade volume of €700billion and bilateral investment valued at nearly €2.4trillion in 2011. If non-tariff barriers were removed, gross domestic product in the EU and the US could be boosted by €163billion by 2018. The agreement could add about 0.5% to the EU's annual economic output.
The agreement could also contribute to the development of global standards and the strengthening of global governance through regulatory integration.
However, reaching an agreement won't be easy. MEPs warn that for all their shared interests, the EU and the US have very different approaches to issues that are close to people's hearts, including animal welfare, privacy and how food is produced. Over the last few years there have been clashes about subsidies for aircraft manufacturers, defence contracts and genetically modified food.
Still, it is important to remember that these disputes involve only about 2% of transatlantic trade. It should be possible to overcome these differences during the negotiations. Compromises will need to be found, but sensible ones.
The European Parliament is broadly in favour of an agreement, but only one that takes account of key EU values, such as the traditional precautionary approach to animal and plant health standards, which affects issues such as genetically modified crops and hormones in beef. They also have concerns about the need to protect the EU's geographical indication system, environmental and health standards, cultural diversity, labour and consumer rights and the restriction on foreign ownership of US airlines.
Once an agreement has been reached, the Parliament will closely scrutinise it before deciding whether to approve it. As became clear with previous international trade agreements such as the controversial ACTA agreement, MEPs will not hesitate to wield their veto if they feel an agreement will do more harm than good.
Photo: copyright European Parliament