AMBASSADOR MEETS WITH ECONOMIC MINISTER GLOS ON

C O N F I D E N T I A L BERLIN 000103 SIPDIS SIPDIS STATE FOR E, EB, EUR USTR FOR AMBASSADOR SCHWAB, DDWOSKIN, SDONNELLY USDA/FAS FOR RCURTIS, DYOUNG E.O. 12958: DECL: 01/16/2016 TAGS: EAGR ETRD ENRG WTRO PREL GM SUBJECT: AMBASSADOR MEETS WITH ECONOMIC MINISTER GLOS ON DOHA, ENERGY Classified By: Ambassador William R. Timken, Jr. for reasons 1.4(b) and (d). ¶1. (C) Summary: Ambassador met with German Minister for Economics and Technology Michael Glos to discuss the Doha Development Round and cooperation on energy/environment issues. The Ambassador also delivered STATE 4760 points on Iran, which will be reported septel. Glos stated Doha's successful completion is of great importance to Germany. Citing the read-out he had received from the Chancellor of her meeting with the President, Glos agreed both the U.S. and Germany want a successful Round. He stated the EU and U.S. working to achieve success would be another important instance of global partnership. He agrees as well that we need to act now to prevent a failure and risk damaging the multilateral trading regime. Glos said he and the Chancellor will make a concerted effort to move the EU -- and the French -- toward a better offer. Despite elections in France, Glos thought the EU could still improve on its current offer, but added such movement would be contingent upon similar steps by the U.S. Glos agreed as well that the World Economic Forum January 24-27 provides opportunities for key players to discuss how to move the Round forward. Glos noted he will meet USTR Schwab in Davos. On energy, Glos agreed with the Ambassador on the need to pursue clean-coal technology both on environmental and energy security grounds and pointed to Germany's advanced technology in this area. He welcomed the President's and Chancellor's engagement on energy and environment issues and looked forward to further cooperation. End Summary. -------------- Participants -------------- ¶2. (U) Glos was accompanied by State Secretary Bernd Pfaffenbach, with whom he periodically and jocularly consulted, as well as by Director General for International Economics Karl Brauner and Staff Assistant Katja Gross. The EMIN and tradeoff accompanied the Ambassador. -------------- Glos on Completing Doha -------------- ¶3. (C) Affirming the Ambassador's readout of Chancellor Merkel's and President Bush's meeting and their mutual desire to complete a successful Round, Glos said the Chancellor reported to the Cabinet that the U.S., starting with the President, indeed wants a successful Round. He said the meeting between the President and Merkel and the Ambassador's paying a call on him are excellent signals going into Davos that the EU and U.S. are serious about completing Doha. Glos noted Merkel's excitement about the chances for Doha, and emphasized Germany has a great interest in successfully completing the current multilateral round of trade talks. He said the alternative to Doha is bilateral and regional trade agreements, which would only compete against each other. He acknowledged that a Doha success was very important to the positive economic development in underdeveloped countries, where lack of opportunity breeds terror. He thought the multilateral trade regime -- and implied our economies as well -- would suffer as a result. ¶4. (C) Glos stated that Germany has been continuing to discuss Doha in the EU -- he mentioned a recent visit by Commissioner Mandelson as well as a conversation Ministry of Economics' State Secretary Bernd Pfaffenbach had recently with WTO Director General Pascal Lamy. Glos thinks the EU can move on its current position, despite French elections in May. He opined that the elections in France presented a challenge, but the importance of the Round would carry the day. The Minister said, however, changes in the EU positions depend on revised offers from the U.S. along with movement from the G-20. Pfaffenbach noted EU Trade Ministers will meet on February 11 with Doha as a main agenda item. Pfaffenbach thought if the U.S. could provide -- confidentially -- some clear indications of where it could SIPDIS move, it would help EU trade ministers agree on a new EU agriculture offer. Pfaffenbach indicated India and Brazil have shown signs of movement in the right direction; however, he thought France and Poland could be difficult. He also said the German Agriculture Minister -- from Glos' CSU party -- might also be problematic. Glos agreed Davos is an opportunity to pursue some of these potential ways forward and noted he would meet with USTR Schwab there. Glos said he thought U.S. Trade Promotion Authority's July expiration date made reaching a deal by end of March imperative. ¶5. (C) Glos asked for the Ambassador's thinking on Chancellor Merkel's initiative to integrate more deeply the transatlantic economic relationship. The Minister said it would be a good sign for transatlantic relations if we can work together to complete Doha. Deeper transatlantic economic cooperation is a particular goal of the Chancellor's during Germany's EU presidency, according to Glos. Referring to the President's meeting with Merkel, the Ambassador noted President Bush's interest in advancing transatlantic economic interests, but stressed the President did not want to draw attention and effort away from successfully completing Doha, a point the President had made to the Chancellor and with which she had agreed. Ambassador told Glos that the President has instructed a deputies-level working group to examine the German proposal and see what can be achieved before the April EU-U.S. Summit. He noted the Chancellor's economic advisor, Jens Weidmann, is in Washington talking about advancing Doha and Merkel's transatlantic marketplace initiative. -------------- Energy -------------- ¶6. (C) Minister Glos, whose portfolio includes energy, agreed that coal is an important energy resource for reducing dependence on oil, which, he added, tends to come from unstable countries or otherwise less than secure sources of supply. Glos also noted advancements of Germany's power plant industry. He said the private sector is the agent that needs to drive technological advancement in clean-coal technology as well as carbon sequestration, but governments may be able to take steps to clear the way forward. He said he was encouraged by Chancellor Merkel's and President Bush's statements on emissions. He thought the goals of the Kyoto Agreement are too ambitious and do not take the world's economic realities into account. That said, Glos acknowledged the domestic political pressures to meet these goals. He agreed with the Ambassador that U.S. and German industry should work together to develop and make available worldwide clean-coal and other technologies that will improve energy security and reduce emissions. TIMKEN JR