CLASS
Transatlantic
Tradewinds
In the 1990s, NAFTA
dominated business
headlines. Today,
though, American
businesses are
returning to familiar
economic waters.
Forget India and
China. They’re looking
across the pond at
some old friends
| BY FRANCIS X. ROCCA
When it comes to international
trade these days, China and
India get all the attention. Business people, political leaders,
economists and journalists alike
are transfixed by the challenges and the opportunities
that these and other Asian countries, with their low
costs and high ambitions, offer the United States.
Yet for all the undeniable growth and dynamism
of rising Asian economies, their impact on America is
marginal compared with that of our older commercial
partners across the Atlantic. According to a report by
scholars at Johns Hopkins University, two-thirds of
all foreign investment in the U.S. in 2005 came from
Europe; and American investment in little Belgium
(pop. 10. 4 million) was more than four times that of
U.S. investment in China. The U.S. and the European
Union together account for 40 percent of world trade
and the same proportion of world GDP.
Now American and European leaders are seeking
to strengthen this economic relationship by eliminating some of the last remaining barriers to transatlantic
trade and investment. Proponents say that such changes will boost employment and investment on both
sides, strengthen a geopolitical alliance that has been
essential to global peace and security for more than
half a century, and help raise living standards for the
rest of the world. Opponents warn that a U.S.-EU free
trade zone could jeopardize the Doha Round of international trade talks; enrich big business at the expense of
workers and consumers; and even stifle the free market
competition that such a zone is supposed to favor.
