A British government minister on Monday welcomed the start of the first round of negotiations between the European Union (EU) and the United States on the Trans-Atlantic Trade and Investment Partnership.

"I welcome the start of negotiations between the EU and US which marks an important step forward in opening up trade between the world's two largest trading blocs," said Lord Green, Britain's minister for trade and investment.

Green added, "Last month at the G8 Summit in Northern Ireland, leaders agreed to launch this landmark trade deal which will fire up economies on both sides of the Atlantic and drive growth and prosperity around the world."

Green said a deal could create up to 2 million jobs in the EU and the US and could be worth 10 billion pounds (14.9 billion US dollars) to the British economy.

Dr. Ramon Pacheco Pardo, a lecturer in European and International Studies at King's College, London and an expert on EU-US relations told Xinhua that in similar Free Trade Agreements (FTA) in the past, the US was almost always able to leverage a favorable position.

"The US has won more than the counterpart, maybe with the only exception of the FTA with South Korea. So, I think it is very likely that the US will end up benefiting more," he said.

"So, even though this may be a win-win situation for both the EU and the US, I think it is clear some EU member states are going to suffer because even within the EU they are not competitive and it might be difficult for them to compete against American companies -- for example the agricultural sector, which is part of the agreement," he added.

Dr. Pacheco Pardo said an agreement would be very significant, and would set the rules of the game for any future FTAs either the US or the EU might sign.

"This is going to be leverage for both of them for signing and discussing future FTAs, or even the Doha Round of trade negotiations when they start again," he said.

"This means more leverage for EU and US, and less for China and the other emerging economies," he said.

He added, "I think it also means that when it comes to the Trans-Pacific Partnership that the US is discussing in Asia Pacific, and if in the end China decided to join this initiative, its position is going to be weak."

"The issue is going to add pressure in many different areas across the world. I think it is not the main objective, but it is one of the American objectives of the FTA," said Dr. Pacheco Pardo.


Two largest economies

Any agreement would be highly significant because they involve the two largest economies in the world, the EU and the US, he said.

Dr. Pacheco Pardo said, "I would say that it is a win-win situation for both parties, insofar as this is going to allow European and American companies to compete on an equal footing in each other's market."

But he said there are several obstacles to agreement, the most important one being the opposition of several European countries -- France, Italy and some Eastern European nations -- that are unwilling to fully back such a deal.

In addition, the recent allegations of US spying on the EU has had a harmful effect.

Dr. Pacheco Pardo said, "The big political scandal which we have now about the US spying on the EU which has made many Europeans think that the US doesn't really trust the European Union ... has a spill-over effect going into these talks."

He said he did not expect talks to proceed quickly unless the US and the Germans pushed for greater urgency.

"That would see Germany taking over a leading role in the European Union. Germany has elections coming up so we will have to see first of all what government is elected, whether that will be Angela Merkel will come back or whether it will be somebody else. So, domestic German politics could have an effect," said Dr. Pacheco Pardo.

There was also opposition in parts of the Republican Party in the US which might block a speedy agreement.

Global Times