EU Tells Trump: No Paris Climate Deal, No Free Trade

Trade & Policy

EU Tells Trump: No Paris Climate Deal, No Free Trade

When Donald Trump took office last year, the assumption was that the transatlantic trade and investment partnership was dead. The controversial free trade deal between the EU and the U.S., known as TTIP, was already years in development and was a big focus in Europe, particularly with left-wing protesters who said the EU would necessarily have to lower its environmental, health & safety standards to American levels.

Work on TTIP has come to a halt, although the European Commission has been keen to stress that it is not officially dead and talks could continue if the US administration were to indicate interest. No such signal from Washington has been forthcoming.

It is in this context that France's foreign affairs minister Jean-Baptiste Lemoyne told the French Parliament last week that his country will insist that TTIP never be revived if Trump carries through on his promise to leave the Paris Agreement.

"One of our main demands is that any country who signs a trade agreement with EU should implement the Paris Agreement on the ground," Lemoyne said. "No Paris Agreement, no trade agreement. The US knows what to expect." Given that every country has veto power over new free trade deals, this threat alone would be enough to kill TTIP. Among EU member states, France has been the most sceptical about the free trade deal. But the position was later given further backing by the EU's trade chief, Cecilia Malmstrom. Asked on Twitter whether she agreed with the French minister, she responded: "Yes Paris deal reference needed in all EU trade agreement today. In Japan agreement and will be in with Mexico & Mercosur."

The EU recently concluded a free trade deal with Japan that includes language on the Paris Agreement, and such language is already in drafts of a free trade deal with the Mercosur countries - Argentina, Brazil, Paraguay and Uruguay.

Since it is ultimately Malmstrom's decision whether to restart TTIP negotiations with the United States, Malmstrom's statement suggests that such talks would not be reopened even if the Trump administration wanted them to be. Whether or not it was coordinated, the two statements are likely part of a larger effort to coax the US into staying in the Paris Agreement.

Many came away from last year's UN climate conference in Bonn with the impression that the US is trying to find a face-saving way to stay in. Under the rules of the treaty, the US cannot leave until November 2020 at the earliest.

If the EU really is serious about making the Paris Agreement a prerequisite for free trade deals, other countries could become ensnared in such a policy shift.

While the US is the only country in the world intending to not be in the Paris Agreement, there are still many countries that have not yet ratified it. These include Russia and Turkey, which already have a free trade deal of sorts with the EU-a link to its customs union.