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EU to press Obama at summit for aid in cutting Russian gas imports

Source: Reuters - Wed, 26 Mar 2014 12:21 GMT
Author: Reuters
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* U.S. seeks show of unity at summit dominated by Ukraine

* Obama, EU counterparts to tackle Russia, trade, energy

* Obama to speak on strength of transatlantic relations

* Both sides to commit to integrate economies in TTIP pact (Updates with Obama visit to American war cemetery, protest)

By Robin Emmott and Jan Strupczewski

BRUSSELS, March 26 (Reuters) - The European Union was set to press U.S. President Barack Obama on Wednesday to help reduce Europe's reliance on Russian energy by exporting U.S. natural gas, as relations with Moscow chill over its intervention in Ukraine.

Obama began his visit to Belgium by visiting the Flanders Field American war cemetery, visiting the graves of some of the 368 U.S. service members, most killed during World War One.

His visit and the symbolism of transatlantic unity had added resonance at a time when tensions in Europe are running high because of Russia's military occupation and annexation of Ukraine's Crimea region.

"This hallowed ground reminds us that we must never, ever take our progress for granted. We must commit perennially to peace, which binds us across oceans," Obama said.

He drew a parallel with today's drive to eliminate Syria's chemical weapons, "the same kinds of weapons that were used to such devastating effect on these very fields".

"We thought we had banished their use to history and our efforts send a powerful message that these weapons have no place in a civilised world," he said.

Obama was due to have just 75 minutes over lunch with the EU's top officials to tackle issues such as energy security and climate change alongside the most immediate concern, Ukraine.

If there were any doubts about the EU-U.S relationship after last year's revelations that Washington was spying on its allies, Obama planned to assuage them later in the day, in a speech to some 2,000 guests, before leaving for Rome.

"Right now, as we look around the world, there is a powerful reason for Europe and the United States to come together to demonstrate that they can take their relationship to a new level," Obama's top trade envoy, Michael Froman, said during a visit to Brussels before the summit.

ENERGY RELIANCE

During Obama's visit to The Hague this week, the United States and Germany, France, Britain and Italy, along with Japan and Canada, warned Russia that it faced damaging economic sanctions if it took further action to destabilise Ukraine.

The EU has already stepped up efforts to reduce its reliance on Russia, which provides around one third of the EU's oil and gas. Some 40 percent of that gas is shipped through Ukraine.

EU leaders dedicated part of a summit to the issue last week and German Chancellor Angela Merkel said she supported asking Obama to relax restrictions on exports of U.S. gas.

One way to do that is through the proposed free-trade agreement between the United States and the European Union, which would be the world's biggest accord of its kind, dubbed the Transatlantic Trade and Investment Partnership, or TTIP.

"We should have an ambitious chapter on energy in the TTIP," EU Trade Commissioner Karel De Gucht, who was due to attend the summit, said at the weekend, referring to EU demands for a clear framework setting out U.S. commitments on gas exports.

The issue will also be discussed next week at a special EU-U.S. Energy Council, officials said.

In the wake of the worst financial crisis since the Great Depression, EU governments and the Obama administration see a deep and broad free-trade deal as the best way to create jobs, removing burdens and customs duties on businesses.

They say a trade pact encompassing almost half the world's economy could generate $100 billion in additional economic output a year on both sides of the Atlantic and set the standards for global business before China does.

The European Union and the United States already trade almost $3 billion in goods and services each day and, by intensifying economic ties, the pact could create a market of 800 million people where business could be done freely.

PUBLIC HOSTILITY

But eight months into talks, public hostility is growing at the idea of unfettered transatlantic commerce, while negotiators remain far apart on many issues.

Around 50 campaigners against the TTIP protested outside the European Parliament on Wednesday, wearing giant Obama masks and waving banners reading 'No Gmo (genetically modified organisms) in our food' and 'TTIP - stop the secrecy!'.

"What is at stake is the safety of our food and the environment," said EU lawmaker Philippe Lamberts, a member of the Belgian Green party.

"Worse, this trade deal is an instrument to allow big companies to do as they wish and trample legislation or write it themselves with lobbyists."

Reports of U.S. National Security Agency spying in Europe have combined with concerns about the damage to food safety and the environment under a free-trade pact. In both the United States and Europe, unions also worry about job losses or reductions in working standards, and say that a trade pact will serve the interests only of multinational companies.

Inside the negotiating rooms, other difficult issues include removing customs duties that cost companies billions of dollars each year, particularly automakers such as Ford and Volkswagen.

Washington and Brussels have been at odds over an initial exchange of offers to open up markets and cut tariffs, with each saying the other has not been ambitious enough.

In an effort to overcome that, Obama, along with European Commission President Jose Manuel Barroso and European Council President Herman Van Rompuy will promise to remove all tariffs on bilateral trade, according to a draft of the summit's joint declaration seen by Reuters. ($1 = 0.7255 Euros) (Additional reporting by Adrian Croft, Jeff Mason and Steve Holland; Editing by Kevin Liffey)

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