President Barack Obama’s push for a trans-Atlantic free-trade agreement in his annual State of the Union address is being welcomed by European leaders, but it could be years before an agreement is in place.
Though it was only a 15-second snippet in President Obama's hour-long address Tuesday, the trade proposal could mean a new chapter in U.S. relations with the European Union.
"Tonight I'm announcing that we will launch talks on a comprehensive trans-Atlantic trade and investment partnership with the European Union because trade that is fair and free across the Atlantic supports millions of good-paying American jobs," Obama said.
The E.U. and the U.S. aim to begin formal talks on a wide-ranging trade partnership in June.
In Brussels Wednesday, European Commission President José Manuel Barroso said the agreement has the potential to generate tens of thousands of jobs on both sides of the Atlantic.
"A future deal between the world's two most important economic powers will be a game changer," Barroso said. "Together, we will form the largest free-trade zone in the world."
European Commission trade negotiator Karel de Gucht hopes a deal can be reached in the next two years. Negotiators are expected to first deal with reducing tariffs, then will try to align regulatory systems around common safety and product standards.
"If we are in a position to set standards together with the United States, they have a good chance to become the global standards," Gucht says. "And that's of the foremost importance for our industry."
The deal has been greeted warmly by some members of Congress and the international business community.
European officials have wanted a free trade pact for 30 years, according to Fred Irwin of the American Chamber of Commerce in Germany.
"The business relationship between the U.S. and the E.U. is very positive at the moment," he said. "But the free trade zone outlined in President Obama's State of the Union Address would reduce expenses because it would eliminate tariffs and encourage trade between the two regions, the E.U. and the United States."
However, there are some doubts in the United States. On Wednesday, the two senior U.S. senators on the committee that oversees trade wrote to the U.S. Trade Representative that any deal would have to grant U.S. farmers access to Europe's markets. In addition, they said a deal could not weaken U.S. regulatory standards and must protect intellectual property rights.
European farmers have traditionally been very influential in keeping tight trade restrictions on agricultural products. Disagreements on genetically modified foods and environmental standards between the two sides will also have to be hammered out before any deal can go into effect.
Even if talks start in June, it could be years before a deal goes into force. It took more than six years to enact the U.S. free trade agreement with South Korea, and four years to complete a deal with Canada and Mexico.
But E.U. officials say they're optimistic that the political will exists in Washington to made the deal happen.
