A populist win could dull Europe's appetite for free trade

Mr Yanis Varoufakis, leader of the DiEM25 party, was one of the first candidates for the European Parliament to bring up the issue of chlorinated chickens.
Mr Yanis Varoufakis, leader of the DiEM25 party, was one of the first candidates for the European Parliament to bring up the issue of chlorinated chickens.PHOTO: REUTERS

FRANKFURT (NYTIMES) - The chlorinated chickens are back. That's a bad sign for free trade.

The birds are being used in a food fight by populists in Europe who are poised to make significant gains in parliamentary elections this week. Such a shift in the makeup of the European Parliament would complicate the simmering trade conflict between the United States and Europe.

Chicken meat from the US is routinely sterilised using a chlorinated wash, a method forbidden in the European Union. The American birds are banned and often cited, with some dread, as an all-purpose justification for putting up barriers to American products.

The Trump administration has tried to put the chickens back on the negotiating table, notably with Britain as it prepares to leave the EU. European candidates, both on the left and on the right, have seized the cluckers as a way to dramatise the stakes in the balloting that runs from Thursday (May 23) to Sunday.

Among the first candidates to bring up chickens was Mr Yanis Varoufakis, a left-wing former finance minister of Greece who is running for a seat in Brussels. During an appearance in March, Mr Varoufakis vowed to block multinational corporations that "will want to introduce chlorinated chickens in Europe".

Mr Matteo Salvini, the leader of Italy's right-wing League party, did not directly mention the birds but invoked food anxiety last week, on the eve of a rally of 11 populist leaders from across Europe.

"In some agricultural sectors, I think of meat. For example, we ask for absolute rigor in the checking of the quality of the production and of the product," said Mr Salvini, who is deputy prime minister and interior minister.

Food accounts for less than 3 per cent of the US$1.3 trillion (S$1.79 trillion) in trade between the US and Europe, far behind products like chemicals, pharmaceuticals, vehicles or machinery. But farmers are among the most powerful political lobbies on both sides of the Atlantic and trade is one area where the European Parliament wields significant power.

 
 
 

Populist parties like Mr Varoufakis' Pan-European DiEM25 or the right-wing coalition led by Mr Salvini are expected to win enough support to deny the two main centrist parties a majority in the European Parliament, according to estimates by Teneo, a management consultant.

The centrist parties - the conservative European People's Party and the centre-left Progressive Alliance of Socialists and Democrats - would have to cooperate with parties like the Greens, who are sceptical of trade deals with the US.

"The rightist parties will play a bigger role. The Greens will play a bigger role," said Mr Peter Balas, a former Hungarian diplomat who is a senior policy adviser at Covington, a law firm. "It will be much more difficult in the Parliament to have a cohesive approach to trade."

Food may be the least of their problems.

European manufacturers have been on edge for months only to see President Donald Trump put off a decision on imposing tariffs on cars imported from Europe, Japan and South Korea. The delay, for six months, averted a sharp escalation of trade tensions. It brought some relief to European leaders who feared the effect of car tariffs on wobbly economies.

But six months is not a long time to negotiate a trade deal. Mr Trump, who has often accused Europe of taking advantage of the US, could easily revive the threat of car tariffs if he believes the Europeans are refusing to make concessions.

European and US negotiators have continued to meet behind the scenes even as China has attracted most of the attention. On Wednesday, Ms Cecilia Malmstrom, the European trade commissioner, and Mr Robert Lighthizer, the US trade representative, were scheduled to meet in Paris, where both were attending meetings of members of the Organisation for Economic Cooperation and Development.

"The EU is ready to start negotiations for a limited trade agreement," a European Commission spokesman said.

The European Commission has limited room to manoeuvre. In April, France and Belgium balked at joining the talks because the Trump administration refused, in 2017, to sign a global pact on climate change. All 28 EU states agreed that agriculture products should not be reconsidered and Congress may not approve a deal that does not help American farmers.

At campaign stops, candidates are trying to rally emotions and votes around food. Their speechifying takes some skill because that trade is lopsided in favour of Europe. The EU sold US$10.4 billion more goods like wine and cheese to the US last year than it bought.

For example, Wisconsin cheese producers are not allowed to sell their parmesan or feta in Europe. The names are restricted for use from regions in Italy and Greece that traditionally produce them.

"Europeans can sell their asiago, parmesan, feta, etc, in Wisconsin, but cheesemakers like me are blocked from selling Wisconsin cheeses by the same names in Europe," Mr Errico Auricchio, president of BelGioioso Cheese, said this month. Mr Auricchio heads the Consortium for Common Food Names, a lobbying alliance that has asked Mr Trump to ban imports of food products that Americans cannot sell in Europe.

Most parties in the race for Brussels say they favour free trade but outline conditions - such as fighting climate change - that run counter to White House policies.

Right-wing politicians do not have a unified position on trade, but there is a strong protectionist faction. At the populist rally in Milan last Saturday, Ms Marine Le Pen, leader of the National Rally party of France, drew applause with her call: "We reject uncontrolled free trade that helps only the banks and financiers." Ms Le Pen has routinely equated food with national identity and has promised to protect farmers.

In a campaign appearance this month, Mr Salvini spoke about foreign food with the derisive tone he uses to denigrate immigrants.

"If you give us a hand choosing the League in the European elections on May 26," he said, "we will go to Brussels and bring back Italian farming, which has been massacred in recent years by Canadian grain, Cambodian rice, Moroccan tomatoes, Tunisian oranges, olive oil from the other part of the world."

Chlorinated chickens have been a sore point since the 1960s. When Europe banned American chickens at the time, the US retaliated by imposing 25 per cent tariffs on European trucks and vans. The EU food safety agency has concluded that the widely used method for treating chickens with a chloride solution poses "no safety concerns for humans". But the ban on American poultry is still in place, as are truck tariffs, an indication of how intractable trade disputes can be.

The US and Europe have fewer problems with each other than each has with China. The US' trade deficit with Europe is less than one-third that of its deficit with China, even though total trade is much larger. Trade with China totalled US$737 billion in 2018, compared with US$1.3 trillion with Europe. But the US had a US$379 billion trade deficit with China, compared with a US$109 billion deficit with Europe.

 

The US has not accused Europe of wholesale theft of intellectual property, as it has China. Europe does not force American investors to work with local joint venture partners, as China does with any foreign entity. European companies are not accused of hollowing out the American industrial heartland, as is the case with Chinese competitors.

Still, expectations are low. There is some hope that the US and Europe can work out agreements in pharmaceuticals, a category worth almost US$100 billion in two-way trade, far more than food. Most business groups are simply hoping relations do not deteriorate.

"What we want at the moment is to maintain the status quo," said Ms Luisa Santos, director for international relations at BusinessEurope, a leading business group.

One thing seems certain.

"Les poulets au chlore ne passeront pas," the French weekly Libération wrote this year in an editorial, albeit with a heavy dose of irony. "The chlorinated chickens shall not pass.