EU's Mandelson Calls U.S. Lawmaker's Trade Gibe 'Offensive'

European Union Trade Commissioner Peter Mandelson scorned as 'offensive' a U.S. lawmaker's proposal to drop the EU as a partner, highlighting the obstacles to a new World Trade Organization agreement.

Bill Thomas, chairman of the U.S. House Ways and Means Committee, said the U.S. should 'divorce' the EU to stop helping it 'drag down the global trade talks.' In a letter to the Financial Times today, Thomas also urged the U.S. government to focus on reaching commercial accords with other regions.

'Thomas's offensive language is unwelcome and untimely,' Mandelson told reporters today in Luxembourg where he met foreign ministers from the 25-nation EU. 'In these WTO talks, no player is more wedded to one player than any other' and 'bilateral trade agreements inevitably would be at the expense of the multilateral trade round.'

The WTO's 149 members want to approve plans for reducing tariffs on machinery, cars and grain by the end of the month to make a broader trade accord possible this year. Four-year-old talks are at an impasse as the U.S. and Australia say a European offer to cut farm aid is inadequate, while the EU presses the U.S. to scale back its own agricultural subsidies and urges developing countries such as Brazil and India to deepen cuts in tariffs on industrial goods.

'Inward Looking'

With U.S. President George W. Bush's negotiating authority from Congress due to expire in next year, Thomas said 'several key WTO members have been locked into their inward-looking positions for a long time' and the 'atmosphere makes it difficult to sell free trade in the U.S. because there is little gain to show for our efforts.'

'We have been sitting next to the EU for a long time and the conversation has been painful,' Thomas wrote. 'Until the EU is serious about true liberalization, we should get up from that seat and visit with others at the dinner table to have more fruitful discussions.'

Mandelson said Thomas's position would amount to a U.S. 'retreat' from the WTO talks. The EU trade chief said that more effort was to needed to bolster the so-called Doha round and that separate U.S. trade accords would undermine global commerce.

'The issue is for all major players to exercise leadership in this round rather than sounding the retreat,' Mandelson said.