The EU and US are responsible together for about two fifths of world trade. Trade flows across the Atlantic are running at around €1.7 billion a day. In the year 2003, the total amount of two-way investment was over €1.5 trillion, composed of €731 billion of EU Foreign Direct Investment (FDI) in the US and around €772 billion of US FDI in Europe. The overall "transatlantic workforce" is estimated at 12 to 14 million, of which roughly half are Americans who owe their jobs directly or indirectly to EU companies. In the year 2005, exports of EU goods to the US amounted to €250 billion, while imports from the US amounted to €234 billion. Concerning trade in services, EU exports to the US amounted to €108.6 billion in 2004 while EU imports from the US amounted to €93.0 billion.
The two economies are interdependent to a high degree. Close to a quarter of all EU-US trade consists of transactions within firms based on their investments on either side of the Atlantic. The transatlantic relationship defines the shape of the global economy as a whole as either the EU or the US is also the largest trade and investment partner for almost all other countries.
Being the largest players in global trade, the EU and the US are committed to cooperate both politically and economically, be it on bilateral issues or in the multilateral framework of the World Trade Organisation (WTO). Several trade-related disputes which regularly hit the headlines in reality only impact some 2% of EU-US trade.

The role NATO played in an age of military threat could be played by a trans-Atlantic free-trade zone in today's age of economic confrontation. The two economic zones -- the European Union and the United States (perhaps with the addition of Canada) -- could stem the dwindling of Western market power by joining forces.

A senior aide to Angela Merkel said the chancellor was "interested" in promoting the idea as long as such a zone did not create "a fortress" but rather "a tool" to encourage free trade globally, "which she is persuaded is a condition of Germany's future prosperity". Separately, on Friday, the US, Canada and the European Union complained to the World Trade Organisation about China's tariffs on car parts, raising the prospect of Beijing facing its first WTO dispute.

As German perceptions of China have grown more American, Washington's approach has shifted too. Speaking before his first trip to Beijing, Hank Paulson, US Treasury secretary, this week outlined a more balanced policy mixing traditional US criticism with praise for China's reforms.

Ms Merkel's aide said it was "far too early" to tell whether the project of a transatlantic free-trade zone would be part of Germany's priorities when it assumes the six-month presidency of the European Union and chairs the G8 group of leading industrial nations from January.

Progress in the Doha Round has consistently fallen short of even the most pessimistic expectations. Four years of talks in Geneva have provided the necessary technical basis for liberalization agreements, but key countries remain unwilling to make politically difficult choices necessary for progress. For example:
• The European Union's offer to cut tariffs that restrict its imports of agricultural goods is far below what the United States and other agricultural exporters are demanding.
• The United States for its part is reluctant to cut its subsidies to its own farmers.
• Major developing countries such as Brazil and India are resisting European Union and U.S. demands for big cuts in their import duties on  manufactured goods.
This triangular deadlock continues, with no indication of any imminent breakthrough. Almost the only noteworthy Doha development in the four months since WTO ministers met in Hong Kong and set the April deadline has been President Bush's apparent downgrading of the Doha Round by moving his very capable chief negotiator, U.S. Trade Representative Rob Portman, to other duties.

If, as many observers argued, the Doha round on trade liberalization was on life support before highly regarded U.S. Trade Representative Rob Portman left last week to become White House budget director, it is hard to imagine what can be done to resuscitate trade negotiations now. (...) The political obstacles lined up to block an agreement in the United States pale compared to what confronts European negotiators and politicians in their homelands. If French President Jacques Chirac caved into the pressure from unions and student protesters over relatively minor reforms in France's labor law, imagine how quickly French nerve would collapse when Mr. Chirac or his successor is confronted by French farmers taken off the dole. Italy's political problems are equally daunting. With his political capital reduced, President Bush has apparently decided to cut his losses and toss the Doha failure on the heap next to Social Security reform and tax reform.

Peter Mandelson, EU trade commissioner, accused the US of lacking realism on agriculture, while the US trade representative's office said it wished the EU would put the same energy into the negotiations as it did in finger-pointing.

The anti-dumping amendment lets US firms raise a levy from competitors' goods which it deems to be too cheap. The amendment was ruled illegal over a year ago and repealed in February, but US firms are expected to benefit from it for a further two years. This latest penalty brings the total extra tariffs imposed upon the US to $36.9m. Peter Mandelson - the EU trade commissioner - has said that while the trade dispute has been resolved, US firms are still receiving payments. (...) Since the Byrd amendment was passed in 2000, manufacturers in the metals and food businesses among others, have been the recipients of billions of dollars in payments.

In a statement, the EU said the Byrd Amendment "has been a long-running irritant in the U.S.-EU trade relationship," but it added "that the huge bulk of EU-U.S. trade is trouble-free."

It will help EU winemakers to build on their current success in the US, which is by far the EU's largest export market. Annual EU wine exports to the US are worth more than 2 billion euros, around 40 percent of EU exports in terms of value. This agreement provides a clear demonstration that the US and the EU can resolve important and complex issues through bilateral negotiations and both sides are committed to doing so in the future.

The leading neo-con magazine “The Weekly Standard” runs an article on transatlantic disagreements on free trade, airbus and agricultural subsidies, the US trade deficit.

The Europeans and the developing nations profess horror at the appointment of Paul Wolfowitz to head the World Bank. They say he doesn't know anything about development, but really worry that he knows too much: that loans to undemocratic kleptocracies might fatten Swiss bank accounts, but do little to fatten starving citizens of so-called developing countries. But Gerhard Schröder and his friends were reluctant to oppose the Wolfowitz appointment, lest they appear to be snubbing President Bush's recent friendly overtures. So they approved the appointment, and will seek a quid pro quo--the appointment of France's Pascal Lamy to fill the vacancy at the head of the World Trade Organization. Lamy is dedicated to the maintenance of the European Union's protectionist agricultural policy, which further enriches well-off French farmers at the expense of poor farmers in developing nations. If he is appointed, and spurns Bush's proposal to end both E.U. and U.S. export-inducing farm subsidies, the Doha round is doomed.