American surveillance may kill US-EU free-trade talks

The ‘biggest bilateral trade deal in history’, reached at the G8 Summit, is possibly at risk as rapport between the US and EU quickly degenerates over leaks which reveal the US allegedly spied on EU diplomats.

The trade relationship, valued at hundreds of billions of dollars, could boost economic growth on both sides of the Atlantic, and potentially be a key factor in ending the economic downturn.

EU leaders are demanding answers after leaked NSA documents revealed the US was tracking diplomatic communications, an accusation, if proved true, could derail the historic free-trade deal.

Both France and Germany, Europe’s largest and second largest economy have both responded strongly to the alleged spying practices.

Germany has officially summoned US Ambassador Philip Murray to the Berlin Foreign Ministry over the alleged spying.

If the reports are confirmed, Chancellor Merkel said it would be “unacceptable Cold War-style behavior.”

French Foreign Minister Laurent Fabius also spoke out against the alleged spying program, calling for an explanation “as quickly as possible" and Hollande said it must ''immediately stop'.

The Transatlantic Trade and Investment Partnership (TTIP) is slated to begin in mid-July with talks in Washington, and be concluded by the end of the year. It could raise economic output in Europe by 0.5 percent.

The deal – which has been in the works for decades – will offer ‘huge economic benefits’ both for the US and EU, Jose Manuel Barroso, President of the European Commission, said after the announcement was made at the G8 summit in Northern Ireland. 

"We cannot negotiate over a big transatlantic market if there is the slightest doubt that our partners are carrying out spying activities on the offices of our negotiators," EU Commissioner for Justice Viviane Reding said.

"Partners do not spy on each other,” said Reding, forewarning a possible breakdown in treaty negotiations.

The German magazine Speigel reported it has seen documents from NSA whistleblower Edward Snowden which allege US agencies bugged and intercepted phone calls and emails of EU officials in Washington and the United Nations in New York.
 
They are also accused of directing an operation from NATO headquarters in Brussels to infiltrate the telephone and email networks at the EU's Justus Lipsius building in the Belgian capital, the venue for EU summits and home of the European Council.

Treaty threatened

Before treaty procedures move forward, the EU will want more transparency from the US.

Other EU officials felt vulnerable heading into diplomatic negotiations with a party that has listened in on classified information beforehand.

The agreement would be a “once in a generation prize,” which could add as much as $157 billion to the EU economy, over $125 billion to the US economy and as much as around $133 billion to the rest of the word, British Prime Minister David Cameron said at the summit, adding it could add two million extra jobs, more choices and lower consumer prices.

Lode Vanoost, former deputy speaker of the Belgian parliament, believes the main purpose of the US surveillance program was “economic spying” on the EU, seeing a connection between economic decline and the need to spy.

“One consequence [of the Snowden leak] for sure is that people will ask, ‘Does it make sense to negotiate a free-trade agreement without clear rules about data protection and control?’” European Parliament President Martin Schulz told reporters in Brussels.

“At the moment, the EU is negotiating a new free trade agreement with the United States,” Vanoost said. “Well, [now the US can gather] what their opponent is already discussing internally of strategy. That is one of the possibilities.”

He added that there is “too much at stake” for there to be a total breakdown in US-EU bilateral relations, however, “behind closed doors there will be some very tough words” exchanged between EU and American officials.