Trans-Atlantic Free Trade

 

Vocabulary

burden	permit (2)	requirement
CO2	standard	take off (3)
strict	rigorous	requirement
zone	stumble	stumbling block
avid	blink (2)	benefit (2)
duty	eliminate	turn signal
version	emissions	harmony (2)
oppose	union (2)	get around (2)
risk	bilateral	measure (2)
sue	take part	expectation
to fire	challenge	minimum wage
fulfill	maintain	race to the bottom
aim	negotiate	transparency
boost	at stake	opponent
doubt	legitimate	disadvantage
enable	obstacle	stimulate

 

 

 

 

 

 

 

 

 

 

 

 

 

Video

 
 
 

Transcript

European cars have yellow turn signals; American cars blink red.

In the European Union, CO2 emissions standards for cars are stricter than in the US . . . but American safety requirements are more rigorous.

The differences are a stumbling block for manufacturers: they’d be the big winners of the planned Trans-Atlantic Free Trade Zone.

Take Ford, the largest American company in Germany.

Bernhard Mattes, CEO of Ford in Germany, is an avid supporter of a free trade agreement — it would benefit his company.

Bernhard Mattes, CEO of Ford Germany: “First, it would eliminate import duties, removing a burden of about a €1 billion a year.

Second, technical standardization. We could develop and produce a single product, reducing complexity and lowering costs.

And third, in the area of testing and permits: one testing procedure and one permit procedure would save a lot of money.

It would reduce development time, and thus benefit consumers.”

One car with the same parts for the whole global market. Ford’s Focus is already sold around the world.

But the Mustang is available only in the United States. Now a special version of it is to arrive on European shores.

In the opposite direction, Ford wants to build new compact engines in the EU and export them to the US — that would create jobs in Europe.

Bernhard Mattes, CEO of Ford in Germany: “With the free trade agreement, economic growth would take off, because opportunities for companies would grow in Europe and the United States.

German companies could compete in the US for additional market shares there; and successful US companies could compete here, and have additional success.”

The agreement would create the world’s largest free trade zone, with more than 800 million people.

But it would affect more than duties and products.

European consumer protection standards and labor laws might be harmonized with that of the United States.

The metal workers and auto industry union, IG Metall, and its chairman, Detlef Wetzel, oppose the free trade agreement.

Detlef Wetzel, IG Metall Chairman: “We think the risks are much greater. We fear that the planned agreement on protecting investments, enables investors to get around state measures, social policy and consumer rights.

They could even sue the tax-payers if their expectations for profits are not fulfilled.

We fear standards will be caught in a race to the bottom.”

For example, investors might go to court to challenge minimum wage laws and laws protecting employees against firings, which were achieved at great effort in Europe.

But the public isn’t really even hearing what is really being discussed in Brussels.

Detlef Wetzel, IG Metall Chairman: “We need transparency here; negotiators on both sides should state their goals. The democratic public has to take part, and see what’s going on, develop and opinion and debate with the negotiators.

But neither the American nor the European negotiators want that.”

Bernhard Mattes, CEO of Ford in Germany: “It’s just not true that the free trade agreement aims to limit workers’ rights.

The employee rights existing in Germany will be maintained.”

Proponents say the trade agreement would boost the EU economy by half a percent, and that would take a decade.

The opponents doubt this prediction.

Detlef Wetzel, IG Metall Chairman: “We don’t make policy in Germany and Europe for the benefit of three companies — it’s not legitimate. We don’t need policies that benefit a few, while disadvantaging many.

If there are obstacles to trade, like import duties, they can be discussed bilaterally, and differently organized without such an agreement.”

To stimulate trade and the economy . . . but at what price?

Negotiations will continue at least through 2015. For Europe, a lot is at stake.

Questions

1. European automobiles are of higher quality than American cars. Yes, no, yes and no, it depends, some aspects?

2. Are separate and different car and safety standards a hindrance or a boost for international trade?

3. Free trade would boost the economies of Europe and the United States. True or false? If yes, give examples.

4. And so do everyone favor free trade? “We fear standards will be caught in a race to the bottom.” What does this mean?

5. Are the negotiations and proposals open to the public or are they conducted behind closed doors (in secret)? Who favors and who opposes transparent talks and discussions?

6. According to the union leader, will a free trade agreement be beneficial (to all)?

7. Everyone, especially the experts, is certain about the future. Is this correct or incorrect?

 

A. Is your nation a part of a free trade zone, association or agreement? Does your country have free trade with other countries? Which countries does your country have free trade with?

B. Who and what would benefit from free trade?

C. Would anyone suffer from free trade?

D. Would you and your organization benefit or suffer from free trade?

E. What do you think should happen? Do you favor or oppose free trade?

F. What will happen in the future?