The world’s leading industrialized nations vowed to seal a series of free-trade deals that would radically change the shape of global commerce despite rising popular opposition.
Leaders of the G7 committed themselves to eight far-reaching accords that would encompass more than 80 percent of the world’s economy but that effectively sideline China and Russia and have met with protests, particularly in Europe.
In the most ambitious round of liberalization since the demise of the Doha round of global trade talks, the leaders of Britain, France, Germany, Italy, Japan, Canada and the United States want to create a market of almost a billion people and set world trade rules that the rest may have to follow.
An EU-U.S. deal alone could generate $100 billion in additional economic output a year on both sides of the Atlantic.
“We aim to finalise (these agreements) as soon as possible,” the Group of Seven said in a statement following a two-day summit in Brussels, a meeting that Russia was cut out of following Moscow’s annexation of Crimea.
Following the worst financial crisis in a generation, the G7 sees the accords as a relatively painless way to create jobs by bring down barriers to business and integrating their economies.
G7 leaders are also involved in smaller international deals that China has joined to liberalize trade in services and remove tariffs on goods that help combat climate change.
But the talks are facing growing hostility, something President Barack Obama discussed with his European colleagues on Thursday, people briefed on the summit said.
The challenge is complicating a trade agenda that is already hitting hurdles. An EU-Canada deal remains unfinished after almost five years of talks, while the U.S. pact with Japan that also includes other Pacific nations - the Trans-Pacific Partnership - is stalled over agriculture.
“We have to come out stronger in public on explaining the advantages of trade,” said European Commission President Jose Manuel Barroso, acknowledging some people felt “alienated” by free trade.
Global Trade Protests
Leaders are eager to avoid the scale of protests that helped derail world trade talks almost a decade ago.
Opponents of trade liberalisation, who range from anti-globalisation protesters to France’s National Front, say the proposed accords are being negotiated in secret and would only benefit big companies fixated on maximizing profits.
Far right and far left parties who performed well in last month’s EU elections are uniting against Europe’s proposed trade accord with the United States - the Transatlantic Trade and Investment Partnership.
They want to block its ratification in the European Parliament, although Europe’s traditional parties still support the proposed pact.
Many are worried about lost jobs and lower labour standards, concerns that French President Francois Hollande sought to address. “We are committed to high standards that can serve as a reference in all our trade relations,” he told reporters.
In the United States, members of Obama’s Democratic party have hardened their opposition against the Trans-Pacific Partnership. (Reuters)