USTR MEETINGS EMPHASIZE U.S.-EU TRADE COOPERATION

C O N F I D E N T I A L LJUBLJANA 000049

SIPDIS

SIPDIS

USTR FOR LESLIE YANG AND DAN MULLANEY

E.O. 12958: DECL: 01/30/2018
TAGS: EAGR ECON ENRG ETRD EUN PREL SI
SUBJECT: USTR MEETINGS EMPHASIZE U.S.-EU TRADE COOPERATION


Classified By: CDA Coleman for reasons 1.4 (b) and (d)

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Summary
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1. (SBU) During his January 22 meetings with senior Slovene
officials in Ljubljana, Deputy USTR John Veroneau emphasized
the importance of movement on the Transatlantic Economic
Council (TEC) and the need to reduce trade barriers globally.
Veroneau,s speech at the Amcham meeting on globalization
sparked questions from Slovenians about the role of migration
in economic growth, disparity in wealth, progress on Doha and
the effect of the possible recession in the U.S. Meetings
with senior Slovene officials at the Ministry of Foreign
Affairs and the Government Office of European Affairs focused
on identifying deliverables for the U.S.-EU summit and
finding economic common ground from which the U.S. and EU
could move forward to set an example for the rest of the
world. End Summary.

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Moving the Ball Forward on TEC/Summit
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2. (SBU) Deputy USTR John Veroneau met with the State
Secretary at the Ministry of Foreign Affairs, Matjaz

SIPDIS
Sinkovec, and State Secretary for European Affairs, Janez
Lenarcic, to discuss TEC, Doha and other U.S.- EU trade
issues. Both Sinkovec and Lenarcic stressed Slovenia,s
commitment to transatlantic cooperation and identifying
deliverables for the U.S.- EU summit, which is expected to
take place in Ljubljana in June 2008. State Secretary
Lenarcic started the meeting with Veroneau stressing the need
for a date for the U.S.-EU summit. He also asked for a date
for the next TEC meeting. He said we need to "score some
progress" and move forward to deal with details if we want to
keep political momentum going. Veroneau agreed with Lenarcic
on the importance of identifiable successes at the next TEC
meeting, and emphasized the importance of the U.S. and the EU
working together to resolve regulatory differences.

TEC Remains A Priority
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3. (SBU) Lenarcic stated that TEC could be important for the
summit, stating that "the time is now to act to clinch some
deals" because of the impending changes in the Lisbon Treaty.
He suggested that this summit, under the Slovenian
presidency is a unique opportunity to get movement on issues
before the likely coming into force of the Treaty of Lisbon
on January 1, 2009, which expands the role of the European
Parliament in EU decision-making and therefore could
complicate matters and make it harder for the Commission to
make deals. He outlined three areas from which summit topics
might be extracted: global; regional; and economic. In
discussing biotech, Lenarcic stressed that even with
science-based policies, it will take some time to sway public
opinion on sensitive issues such as biotech.

GOS Seeks Cooperation on Energy and Climate
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4. (C) Lenarcic suggested that moving forward cooperatively
toward fighting climate change could be a summit deliverable.
Lenarcic assured Veroneau that Slovenia does not support a
carbon import tax, but he expects the pressure for such a tax
to grow. Lenarcic admitted that a common approach to climate
change at this point is unlikely, but he would like to see
the U.S. and EU positions come closer together. He suggested
that this would show that the U.S. and EU are allies on the
issue. This cooperation would relieve some of the pressure
from businesses on both sides who are concerned that the
climate change dialogue will hurt economic growth.


5. (C) Lenarcic and Veroneau agreed that technology will be
a critical element of dealing with climate change. Lenarcic
suggested that the U.S. and EU should focus on biofuel
standards, one of the areas of cooperation under the TEC.
Lenarcic posed the question of whether increases in food
prices will change the equation for biofuels and agricultural
subsidies. He noted that food prices are impacting people
greatly and it is an issue that citizens are following
keenly. He also wondered how the increases in food and oil
prices will evolve and impact how we approach agriculture.
In his opinion, agricultural subsidies will diminish, and the
agriculture budget will change to food security, safety and
rural development.

Biotech Will Not Be Resolved Easily
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6. (C) Ambassador Veroneau noted that DG Agriculture
appeared to be concerned about the negative effect of
non-science-based EU biotech policies on food and feed
prices. Lenarcic noted that EU policies differ in some
respects from member states' policies. He said that the EU
as a whole is not particularly against biotech products, but
that some member states must be brought in line. The EU
position, he believed, is not to keep products out of the
marketplace but to allow consumers to choose. Lenarcic said
biotech is a very difficult issue because people are
reluctant to accept unfamiliar technologies. Veroneau pushed
back and urged the EU to tackle this admittedly difficult
issue, which was not going to go away.

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MFA Focused on Summit Deliverables
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7. (C) State Secretary Sinkovec assured Veroneau that
Slovenia is "very transatlantic and supports free trade." He
also said that Slovenia is looking forward to the next TEC
meeting and the upcoming U.S.-EU summit. Director of the
Americas at the MFA, Roman Kirn, hoped that the next task
force meeting, to be held January 28 in DC, would result in
dates for the TEC and the summit.

GOS Wants to Focus on the Positive
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8. (C) Kirn commented that 97 percent of global trade flows
without restrictions, but we seem to focus on the 3 percent.
In the transatlantic economic dialogue, he suggested that we
look at practical deliverables and show the general public
and business community that progress is being made. He
stated that "we must show that TEC is a credible forum for
achieving mutual goals." Veroneau agreed that deliverables
would strengthen the credibility of the TEC process. He went
on though to say that TEC must solve problems. It can be
"more than poultry but not less than poultry," and along with
big ideas there needs to be tangible results.

Cooperation in Regulations
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9. (C) Kirn identified three areas for possible U.S.- EU
cooperation in the TEC: mutual recognition of accounting
standards or progress to facilitate trade in electrical
products with respect to conformity assessment procedures;
developing coordinated standards for new industries like
biofuels; and defining a set of priorities such as in
poultry, with a time table for solving the problems. Kirn
stated that cooperation in any of these three areas would
show that the U.S. and EU were getting closer.

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Comment
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10. (C) USTR Veroneau,s visit was a good opportunity for
the U.S. to engage the Slovenians on economic issues that
will be important during Slovenia,s EU presidency. The
Slovenian officials focused on defining positive results for
the summit, but appeared reluctant to deal with thorny issues
like biotQh and Doha. The Slovenian ministries are
well-versed in the issues that are likely to arise during the
presidency, however, the GOS remains cautious about opening
dialogue on contentious issues. End Comment.


11. (U) USTR Representative Dan Mullaney and Deputy USTR
John Veroneau cleared on the cable.
COLEMAN