Time for a New Transatlantic Deal. Ambassador Lambrinidis discusses EU-US relations

For the past two years, Stavros Lambrinidis has been holding the delicate position of European Union ambassador to the US, representing the bloc’s 27 member states in Washington DC – not exactly a walk in the park with Donald Trump in the White House and four year of convoluted bilateral relations. As he explains to Formiche.net, with Joe Biden the EU can write a new page in the history of Transatlantic relationship, although bringing the two sides of the Atlantic closer will require hard work. From revenue to emerging technologies, from vaccines to relations with Russia and China, here’s where to begin.

Mr. Ambassador, how do you think EU-U.S. relations can develop under the new U.S. administration?

Very positively. Simply put, we have a once-in-a-generation opportunity to reinvigorate the transatlantic relationship and that is good news for the EU, the U.S. and the rest of the world.

For decades, the relationship between us hummed along nicely and was perhaps even taken for granted at times. Recent transatlantic turbulence, largely around trade issues, as well as rising authoritarianism around the world, have shaken us out of any complacency.

We are already addressing bilateral irritants that have carried over into this new U.S. Administration, such as the Airbus-Boeing dispute and U.S. “national security” tariffs on steel and aluminum. But we must also begin to provide leadership globally where it is needed. We are pleased that President Biden values the multilateral institutions and alliances the United States itself helped build. We have all benefited from them and now need to equip them to deal effectively with new challenges like global health, environment, the digitization of our societies, fair trade, human rights, sustainable development, nuclear proliferation, global peace and security, and so on.  We have a much better chance of success if we, the EU and U.S., work together on this as true partners and allies.

Since taking office, President Biden has made it crystal clear that his Administration sees Europe as an important ally and a partner. In the first 100 days, there has been an unprecedented level of contact, with President Biden even joining  the last EU Summit in March and his Secretary of State, Antony Blinken, visiting Brussels interlocutors already twice in this young Administration. In June, we will have an EU-U.S. Summit in Europe for the first time in years. These send very powerful, positive signals.

During the last four years, the two sides have experienced moments of division and sometimes even tension. In which field do you think is more urgent to come back to mutual cooperation?

Indeed, trade measures taken by the U.S. against the EU under the previous Administration, and the necessary imposition of EU rebalancing measures in response, created stresses in the EU-U.S. relationship and added costs and uncertainty for people and companies trying to do business across the Atlantic. While we still need to iron out and find permanent solutions for those disputes, the good news is we’re working constructively on them, and this will help the EU-U.S. trade relationship to be all it can be – the engine of our very own and of global prosperity.

Having come through the turbulence, we have a deeper appreciation for our economic interdependence, and new insight why good transatlantic relations matter. Even the appearance of transatlantic division can give oxygen to autocrats around the world who are ready to take advantage at any moment.

So, in my view the first order of business is to send a clear message of transatlantic unity to rally democratic nations around the world, and to ensure our own democracies internally, and the rules-based international order, not only survive, but thrive. That is why the EU is fully behind President Biden’s call for a Summit on Democracy later this year, and will play a full part in that.

More immediately, recovery from the pandemic and reopening our economies is the top priority on both sides of the Atlantic. While we can never erase the pain of losing a loved one to the virus, we can take some pride and comfort in the fact that the first vaccine authorized for emergency use was the product of transatlantic collaboration, between Pfizer and BioNTech.

It will take more than vaccines to meet this moment. On both sides of the Atlantic, we are putting together ambitious packages to get our lives and our economies moving again in ways that are greener, more resilient and more sustainable. In the EU we’re just beginning to implement and disburse our brand new 7 year budget and special purpose “NextGenEU” recovery fund, while in the U.S., President Biden has announced a number of legislative proposals that will provide massive stimulus once enacted. Our instruments are not the same and may mean that our recoveries take place at different paces, but our overall  goal is the same: to put the pandemic in the rear-view mirror and place our economies on a sounder footing for the future.

Climate change is another urgent priority. Drastic action is needed before the end of the decade to bring us back from a dangerous tipping point.  The return of the U.S. to the Paris Accord, and President Biden’s initiative to host a Climate Summit with more than 40 world leaders, have helped to raise the level of global ambition. These steps mean that the U.S. is once again part of the global effort and working hand in hand to develop innovative solutions to cut emissions and doing what America does best – inspiring other countries to raise their game.

All these priorities are mentioned in the “Joint Communication” on a new and ambitious EU-U.S. agenda for global good, which was presented by Commission President von der Leyen and High Representative / Vice President Borrell right after the U.S. elections. This short document was very well received by our American interlocutors during the transition and has allowed us to engage quickly and effectively.

The EU has long been promoting its “strategic autonomy”. Yet this U.S. administration advocates for an “alliance for democracy”. Do you believe the two approaches are at odds or is there a way to find a compromise?

They are not at all at odds. If the EU is better equipped to exercise influence based on our joint strengths and values, that’s also good for our alliances and for the future direction of the multilateral system.

A stronger, more resilient and more assertive Europe will be a better partner for the United States and for NATO. Strategic autonomy simply means enhanced EU capabilities and greater geostrategic, economic, and values-based influence globally. At the same time, strategic autonomy enables the EU to act and take on more responsibility in areas that are not a primary concern for the United States, such as conflicts on our periphery.

But “open strategic autonomy,” as we have specifically termed it, is not limited to security and defense. For example, the pandemic has shown how an issue such as health can quickly become a geopolitical concern, with competition for strategic resources, supply chain components, PPE and medical equipment at the forefront. In the area of international trade, the EU should be able to better leverage its huge and open single market, both to fortify our own unparalleled openness to the world, and to ensure fair trading practices by others. Our pursuit of greater European “autonomy” (which is quite the opposite of “autarchy”) will also allow us to jointly pursue with others other key objectives, such as the free and privacy-respecting flow of data across borders, or climate change goals that are also necessary for open and fair global trade.

The U.S. Congress has launched the Democracy Technology Partnership Act, a bipartisan proposal aimed at creating an alliance of democracies on the tech front to face the challenge from authoritarian States like China and Russia. Should the EU be part of this alliance?

This legislation is still being debated in Congress, so it’s difficult to speculate how it will look in its final iteration, or whether and how the EU should participate. However, in terms of confronting regimes that use technology to suppress, track, and monitor their citizens, the EU is determined to build an ethical, rights-respecting alternative to some governments’ digital illiberalism. We hope to work with our American partners to achieve that.

Take one example: The use of facial recognition systems, under strict oversight, can certainly help make our lives more secure. But it can also allow governments to engage in mass surveillance, “social scoring,” intimidation, and repression. We need and must lead in setting democratic standards for the proper use of critical and emerging technologies. The EU is the first major regulator to issue a proposal for a framework regulation on Artificial Intelligence. When it becomes law, it will ensure that innovation flourishes while respecting basic human rights.

Promoting democracy in the digital space is an area where EU-U.S. interests converge, where our collective leverage can best be used, and where global leadership is sorely needed. Our technological leadership and shared values make us ideal partners to create alliances with big and small countries all over the world and to face the challenges from rival systems of digital governance.

Critical technologies like 5G and Artificial Intelligence (AI) have been at the center of a harsh confrontation between the U.S. and China. The U.S. have been asking their allies in Europe to ban Chinese companies linked to the Chinese government from the 5G network. Do you think the EU 5G toolbox is enough or other steps may be needed?

Our 5G Security Toolbox helps all those investing in and operating digital network infrastructure to make decisions, taking national security concerns into account. It is an excellent tool, which has been proven to work well, as evidenced by the important decisions operators are now taking.

More broadly, the critical issue of cybersecurity needs to address the whole value chain, from hardware to software, from deployment to data governance. Europe continues to put guardrails in place to ensure digital technologies and applications, including AI and facial recognition, are bound by data protection (GDPR) and other regulatory controls. Having safe, secure and trusted digital services is important to any rights-respecting government.

What do you think of the plan for a “minimum tax” on big corporations proposed by the current U.S. Administration?

We welcome U.S. Treasury Secretary Janet Yellen’s call to establish a global minimum corporate tax. The EU and its Member States have long backed the Base Erosion and Profit Sharing (BEPS) project at the OECD, as well as the current dialogue on tax challenges arising from digitalization. We have always advocated that these issues should be resolved at the multilateral level.

The EU remains committed to ensuring that all businesses, including digital businesses, pay a fair share of taxes where it is rightfully due, and hopes that all G20 Finance Ministers will work to achieve consensus by July of this year.

Do you feel there is still room for an EU-U.S. deal on the EU digital tax and how could that compromise be reached?

When the EU first proposed its Digital Services Tax, it made clear that the preferred solution was a multilateral agreement. It is important to bring the global system of taxation rights into the 21st century and the fundamental concept of fairness forms the backbone of Europe’s approach.

We’re analyzing carefully the details and design of the new U.S. proposal at the OECD, and looking forward to working with all partners, first and foremost the U.S., to reach an agreement as soon as possible. This will require innovative solutions on both sides of the Atlantic, and I trust that the negotiators in Paris will reach a fair and equitable deal.

The U.S. administration has announced a new effort to help allies in the vaccine race. Do you think EU countries should work with the U.S. or that they should work with any country (including systemic rivals like Russia and China) on this field?

We must vaccinate people all over the world faster than the virus mutates. So, vaccine solidarity has been important to the EU from the start of the outbreak. “Solidarity,” in this case, is not “charity.” I am proud that the EU has been the global leader in supporting vaccine development, production, and exports, and committed to equitable access. As the major producers of safe and effective vaccines, the EU and U.S. also need to be the major suppliers of solidarity. And as major donors to the COVAX Facility, the global initiative to secure equitable vaccine access for the world, the EU and U.S. are already leading world efforts towards this goal. When the U.S. wraps up its own vaccination campaign, I look forward to even closer transatlantic cooperation in getting vaccines to others.

Having said that, and as we struggle to put out the current fire, we must also see to it that the world is better prepared to prevent future outbreaks. Soon, on May 21, the European Commission and Italy, as chair of the G20, will co-host the Global Health Summit to help strengthen international health preparedness.  European Council President Charles Michel and WHO Director General Dr. Tedros,Adhanom Ghebreyesus have already proposed a treaty on pandemic preparedness and response in the framework of the WHO. So far, this proposal has garnered support from 26 world leaders from across the WHO regions, which is encouraging. One thing is sure, international collaboration will be key.