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--Negotiators May Agree On Food Safety Rules, Avoid Bigger Tariff Talks
By Evan Ryser
     WASHINGTON (MNI) - Former United States Trade Representative officials told
MNI they see momentum for a mini trade deal between the U.S. and the EU,
avoiding a fight over agriculture and digital rules that worsened a clash with
China.
     Small rule changes that free up two-way food trade could be done in the
next few months along with some focus on digital commerce, said Darci Vetter,
former chief agricultural negotiator for USTR.
     There have also been discussions on a limited set of technical issues
around animal and plant health standards, while a comprehensive deal that lowers
agricultural tariffs is not "anywhere on the table," she said in an interview.
     "You've seen the EU be very clear that agriculture sort of writ large was
not in their mandate for an overall trade deal with the U.S. -- I don't think
that has really changed," said Vetter, now general manager for public affairs at
Edelman.
     European officials appear to be aiming their pitch towards the kind of
quick trade deal President Donald Trump has often touted, according to Bruce
Hirsh, former assistant USTR. "The Europeans have been reading the tea leaves
and have been seeing what the Trump administration has been interested in
lately. They have been small scale and have checked certain boxes, including
agriculture."
     --U.S. INTERESTED
     "It is a possible sign that the U.S. is at least interested in exploring
the idea that the EU has put on the table," he said. 
     Trump's threats of tariffs against China, the EU, Mexico and Canada slowed
global investment and manufacturing last year, pressing the Fed and other
central banks into the biggest wave of rate cuts since the 2008 financial
crisis. In this election year Trump has moved to sign a Phase One deal with
China, ratify USMCA and has avoided repeated Twitter threats of EU tariffs.
     Whether small EU rule changes placate farmers and their supporters on
Capitol Hill remains to be seen, said Hirsh, also former chief international
trade counsel to the Senate Committee on Finance.
     European Commission President Ursula von der Leyen said in Davos she wanted
an agreement together "in a few weeks' time."
     Von der Leyen is expected to visit Washington as soon as next month.
     --PERDUE SEEKS RECIPROCITY
     U.S. Secretary of Agriculture Sonny Perdue on Wednesday told reporters
"there is a pretty significant list" of changes to food health standards "which
we think they could get pretty close to equalizing our trade balance between the
two entities if they do that." He cited a USD10 billion to USD12 billion trade
deficit with the EU in agriculture.
     Perdue said European complaints about U.S. sanitary practices, especially
those involving fruits and livestock, could be addressed in trade talks with the
EU. "We are very close to resolving those SPS issues from our perspective," he
said, adding an agreement was in sight "if we saw any kind of reciprocity on the
part of Europeans."
     Tariffs do not have to be on the table "initially," Perdue said, but
"certainly the SPS issues have to be addressed" as well as non-tariff barriers.
--MNI Washington Bureau; +1 202 371 2121; email: evan.ryser@marketnews.com
[TOPICS: M$U$$$,MC$$$$,MI$$$$,MX$$$$,MGU$$$]