US Congressman Dan Burton – seen delivering the keynote address at the FICAC European Regional Conference held recently at the Château Sainte-Anne in Brussels, Belgium.
Congressman Dan Burton with FICAC members and Directors. From Hon. Marko Smole, Hon. Aykut Eken, Hon. Dr. Mirza Ihktiar Baig, Hon. Thomas Amaral, Hon. Robert Blum, Hon. Amarkai Amarteifio, Congressman Dan Burton, Hon. K. L. Ganju, The Honourable Arnold Foote, Hon. Costas Lefkaritis and Hon. Nikos Margaropoulos.US Congressman Dan Burton, in his address, said:
Ladies and Gentlemen, thank you for the invitation to speak to you today. It is an honor to have this opportunity to share my experience as a Senior Member of the Committee on Foreign Affairs of the United States House of Representatives with this distinguished gathering of consuls—the men and women who stand on the frontlines of international relations. In my thirty years in the United States Congress, I have been privileged to see the affects of the work that you do firsthand.
I have served on all five of the Foreign Affairs Committee’s regional subcommittees and as a result have traveled widely. I would like to speak to you today about the importance of the relationship between the United States and Europe. The historical significance of this relationship is beyond question. The major conflicts of the twentieth century ended the way they did because the United States and Europe found ways to come together, to stand shoulder to shoulder to solve the challenge at hand. A century that began with conflict within Europe ended with the United States and the nations of Western Europe working hand in hand, joined by allies from around the globe, to defeat a threat that had already swallowed up the Eastern half of the continent. A decade into the next century and two decades after the fall of the Berlin Wall, the nations of Eastern Europe are now, for the most part, free and have made great strides to join the transatlantic community. However, the transatlantic community faces major new challenges from inside and out. Decades of excessive spending on both sides of the Atlantic have led to large deficits, high unemployment, and a negative business climate. These forces threaten to stall the powerful economy
which serves as the heart of the transatlantic community. At the same time our common security is threatened by a rising tide of extremist violence at a time when NATO, the institution founded to defend the transatlantic community, faces questions about its future. These are the issues that have brought me to Brussels and are the issues that I would like to speak with you about today.
Economic Challenges and Opportunities
Despite the current economic problems in the U.S. and Europe, the transatlantic economy remains the largest, wealthiest and most integrated market on earth. Restarting this economic engine will drive economic growth and create jobs on both sides of the Atlantic. This is the message that I constantly hear from businesses, think tanks and diplomats in Washington. I could not agree more.
That said, we must start by putting our respective houses in order. Governments on both sides of the Atlantic have spent beyond their means. Despite its proponents’ predictions, this deficit spending has not produced a vibrant economy but has instead led to high unemployment and economic stagnation. As I speak, many in Europe are experiencing the painful consequences of these flawed economic policies. We see this in Greece as the Greek people are forced to accept painful cuts in wages and pensions while investors are forced to accept “voluntary” write-downs on the value of their investments. The United States cannot bailout Europe; instead, the United States must see the Greek experience as a clear warning and follow the lead of our European allies by cutting our own spending to sustainable levels.
At the same time we must look for ways to drive growth across the transatlantic economy. In the coming weeks my Subcommittee will hold a hearing that will seek to identify economic opportunities for U.S. companies in Europe and Eurasia. I hope that my colleagues in European parliaments are looking for similar opportunities in the United States.
One topic that I am eager to discuss is how economic opportunities inside the E.U. and the U.S. can be enhanced by transatlantic trade agreements. The U.S. Chamber of Commerce has suggested that the U.S. and the E.U. work to sign several “parallel” agreements in different areas such as the elimination of tariffs, regulatory cooperation, and visa liberalization.
Such agreements have real value. A study conducted by the European Centre for International Political Economy and funded by the U.S. Chamber of Commerce estimates that a transatlantic free trade agreement restricted to goods could increase U.S. exports to the EU by eight to seventeen percent and EU exports to the US by seven to eighteen percent. In fact, the most valuable aspect of such an agreement may be to get the ball rolling and open a route to further agreements that avoids the delays and loss of momentum that plagued the United States’ recent trade agreements and continues to plague the Doha Round.
Beginning to talk about an agreement between the US and the European Union that initially takes place outside of Doha does not mean that the transatlantic community should look inward.
The opposite is true. The transatlantic community must also look to emerging markets on its periphery. Russia’s entry into the World Trade Organisation and Turkey’s rise as a regional power are prime examples; and the economic potential of the continued development of Central Asia and the gradual accession of the Western Balkans to the European Union must not be overlooked.
My colleague on the Europe Subcommittee, Congressman Gregory Meeks, and I created the Congressional Caucus on US-Russia Trade and Economic Relations after visiting Russia last year, where we heard from American companies about the importance of the emerging Russian market. These companies made it clear that Russia’s accession to the World Trade Organization will create great opportunities for US and European companies by lowering tariffs on goods and services.
In Russia, once all WTO-mandated tariff reductions are phased in, the average tariff rate will drop by almost a quarter from 10 percent to 7.8 percent, a reduction that represents a significant drop in the barrier to entry into the Russian market faced by US and European countries. In addition, barriers will drop to zero for information technology products under the WTO’s Information Technology Agreement. Such ease of access should allow exports to Russia to outpace their current growth.
According to the US Department of Commerce, exports to Russia from my own home state of Indiana grew by 167 percent in the first half of 2011, compared to 12 percent growth for Indiana’s exports to the rest of the world. Lower tariffs are not the only benefit of Russia’s WTO accession for U.S. and European companies as accession to the organisation will require Russia to respect intellectual property rights and provide a venue to solve trade disputes. As Congressman Meeks and I saw on our visit, American and European companies are in Russia, want to be in Russia, and want to expand their operations in Russia. Russian membership in the WTO will give these companies the tools they need to succeed.
Turkey, itself an important member of the transatlantic community and member of the EU Customs Union, is another large emerging economy that holds great potential for US and European companies. Unfortunately for those of us on the far side of the Atlantic, European companies have taken the lead. Nearly half of Turkey’s foreign trade is with Europe, while only five percent of Turkey’s imports in 2010 came from the United States. These numbers show that American companies are simply not taking advantage of a market containing 79 million people and a $960 billion economy. This must change. US companies must follow their European partners—and rivals—into Turkey.
While the region’s economy is not the size of that of Russia or Turkey, Central Asia offers increasing opportunities for trade and investment. As the region’s economy continues to develop and diversify, the potential opportunities for US and European companies will increase. This point was illustrated recently by the decision by Air Astana, Kazakhstan’s national airline, to purchase seven Boeing aircraft worth a $1.3 billion, including three 787 Dreamliners.
In November, I travelled to the Western Balkans where I met with leaders and U.S. diplomats in Croatia, Serbia, Kosovo, and Bosnia and Herzegovina. Despite the ongoing Euro crisis, the leaders of this historically divided region were united in the desire for their country to join the European Union. I realize that it is tempting for European leaders to focus solely on the matter at hand, the crisis, when they meet next month; however, I respectfully urge the European Council to continue to emphasize the importance of eventual EU membership for all the nations of the Western Balkans.
In particular, I urge the council to consider granting Serbia candidate status. We must remember that EU candidacy is not simply a reward for past reforms but a tool for continued engagement. Such an action should send a message to the region as a whole that EU expansion in the region will not end with Croatia or even Montenegro, but will eventually include all of the Balkan nations. By pursuing such a course of action with respect to the region as a whole, the EU will be doing more than simply opening up markets. EU
integration for the Western Balkans will help ensure the profitability of the significant investment that the transatlantic community continues to make in the region and will be a tangible step toward the longstanding transatlantic goal of a Europe, whole and free.
The Future and NATO and Transatlantic Security
On that note, I believe that it is appropriate to shift gears in order to discuss transatlantic security. As I am sure all of you know, back in June, hen-Secretary of Defense Robert Gates lamented that many of NATO’s European member-states are not meeting their commitments to the organisation. As the Secretary pointed out, only five of NATO’s 28 members – the United States, the United Kingdom, France, Greece, and Albania – exceeded the agreed two percent of GDP threshold with regard to defense spending. This statement grabbed the headlines and I certainly agree with the Secretary’s concern.
However, it is important to note that the Secretary’s concerns ran deeper than how much members of the alliance spend to how members of the alliance spend. The Secretary characterized the $300 billion spent on defense annually by members of NATO other than the United States as “significantly less than the sum of the parts.” As we approach this year’s NATO summit, it is my hope that all members of the alliance can work together to allocate resources wisely, while keeping defense spending as close to appropriate levels as possible. Given the current economic climate, it is especially irresponsible for any member of the alliance to assume that its allies will provide for its security without that country contributing its share. NATO’s Libyan operations represent the alliance’s second “overseas” deployment after the ongoing operations in Afghanistan. Libya required substantial support from the United States even while our European allies were leading the operation. The US will continue to make significant contributions to the alliance; however, for future operations to be successful, their burden must be more equally spread.I would like to highlight the fact that the fifth country that the Secretary listed as meeting the two percent threshold was not a traditional military power located in Western Europe, but Albania, located in the Western Balkans. The fact that Albania, which joined the alliance in 2009, meets the two percent threshold and contributes over 400 soldiers to NATO operations in Afghanistan stands as a powerful argument for enlarging the alliance even in tough economic times.
Just as the European Union should not forget about aspiring members during tough economic times, neither should NATO. It is true that the acceptance of members, especially those on the periphery of the transatlantic community, creates potentially expensive security commitments. However, members of the alliance must remember that new members can also enhance NATO’s capabilities. Accepting new members can allow nations to continue to provide resources that the alliance already relies on. This is the case with Georgia, which will soon increase the number of troops it contributes to NATO operations in Afghanistan from over 900 to almost 1,700. The majority of Georgian troops in Afghanistan serve in the violent Helmand Provence. The willingness to make such contributions and sacrifices are essential for the future of NATO and the transatlantic community.
Thank you for the opportunity to speak to you today. I hope that I have shown that the transatlantic community can have a prosperous and secure future. However, in order for this to happen governments on both sides of the Atlantic must do what families on both sides of the Atlantic are constantly challenged to do: get their finances in order.
