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The writer, a former US ambassador to the EU in the Clinton administration, shares insights.
A new transatlantic framework, akin to NATO, is essential in addressing the challenges of the 21st century. While NATO plays a vital role in supporting Ukraine against Russian aggression, as it did in ending conflicts in Bosnia and Kosovo in the 1990s, it currently monopolizes the attention of leaders on both sides of the Atlantic. However, our issues extend beyond NATO’s mandate, as military security, economic security, and prosperity are interconnected and require coordination rather than isolation.
We must consider the challenges at hand: the ascent of China, the existential threat of climate change, the need to secure vulnerable supply chains and critical minerals, advancements in transformative technologies like artificial intelligence, the persistent nuclear threats from Iran and North Korea, and the imperative to rebuild Ukraine. All of these demand unprecedented cooperation between the US and the EU.
We have precedents for forging this new relationship: the 1990 Transatlantic Declaration under President George HW Bush, the 1995 New Transatlantic Agenda under President Bill Clinton (which the writer helped negotiate), and the recent announcement of a “renewed Transatlantic partnership” in 2021, resulting in the establishment of the joint Trade and Technology Council. The US and the EU have also successfully collaborated in imposing impactful economic sanctions on Russia, thwarting Vladimir Putin’s attempts to undermine the transatlantic relationship.
The US is the EU’s largest bilateral trade and investment partner. Intra-company transfers account for one-third of transatlantic trade, and investment in each other’s markets makes up over 30% of global investment. Notably, American companies invest significantly more in Ireland than in China.
However, more must be done. While Nato summits see the automatic attendance of American presidents and European heads of state, meetings between US and EU leaders are sporadic. There is a lack of shared vision, with initiatives being pursued independently without adequate consultation across the Atlantic.
In recent weeks, the European parliament adopted comprehensive AI regulations without US input, while the White House pursued a voluntary approach, leaving the issue unaddressed by Congress. Moreover, Congress enacted the Inflation Reduction Act last year, providing substantial subsidies and tax incentives exclusively to US-based companies for clean technologies, excluding European counterparts.
The US and the EU also diverge on climate change approaches, with Europe implementing a carbon border adjustment mechanism to tax carbon-intensive imports and maintaining a cap and trade system, while the US has rejected these measures.
The upcoming EU-US Summit presents an opportunity to fortify the transatlantic relationship against future political turbulence. Here are six steps that should be taken:
1. Recognize the EU’s increasing role in the security arena.
2. Develop mechanisms to prevent surprises from unilateral law-making by establishing a transatlantic impact statement and prior consultation.
3. Enhance economic integration through negotiations for a reimagined transatlantic free trade and investment initiative aiming for a tariff-free transatlantic marketplace within a decade, while ensuring the protection of national environmental laws. Additionally, remove barriers to investment, align capital markets with mutually recognized accounting standards, and enable products to meet unified criteria accepted in both markets, thus establishing Western standards for global sales.
4. Reinstate transatlantic private sector organizations from the 1995 New Transatlantic Agenda, representing business, labor, consumer, and environmental interests.
5. Expand on the Transatlantic Legislators’ Dialogue by establishing a Transatlantic Assembly modeled after NATO’s North Atlantic Assembly.
6. Establish annual EU-US Summits.
These measures will strengthen the geopolitical and economic transatlantic partnership, complementing our successful military alliance, to effectively tackle the global challenges of the 21st century.
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