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Cablegate: Glass Half Full: Germany Backs Current Doha

VZCZCXRO0565
OO RUEHIK
DE RUEHRL #1605/01 3521529
ZNR UUUUU ZZH
O 181529Z DEC 09
FM AMEMBASSY BERLIN
TO RUEHC/SECSTATE WASHDC IMMEDIATE 6103
INFO RUCNMEM/EU MEMBER STATES PRIORITY
RUEHGV/USMISSION GENEVA PRIORITY 1582

UNCLAS SECTION 01 OF 02 BERLIN 001605

SIPDIS
SENSITIVE

USEU FOR PCHASE, DMULLANEY.
STATE PASS TO USTR FOR DWEINER, LYANG; TO COMMERCE FOR
MAC/ITA/AGORSHENIN/4212

E.O. 12958: N/A
TAGS: ETRD ECON PREL EAGR WTRO EU GM
SUBJECT: GLASS HALF FULL: GERMANY BACKS CURRENT DOHA
PACKAGE

REF: BERLIN 00666, STATE 123787

BERLIN 00001605 001.2 OF 002


1. (SBU) SUMMARY. German government and industry fully
concur in calling for a swift conclusion of the Doha
Round. They believe that the current Doha package is the
best result that can be obtained. Senior government and
industry officials have signaled that they consider U.S.
demands for more market access in emerging countries to
be unrealistic. The German delegation to the WTO
Ministerial from Nov 30 to Dec 2 described the
atmospherics at the meetings as good, but expressed
disappointment that no progress was made on substance.
END SUMMARY.

2. (SBU) German government and industry stress that,
especially in these economically difficult times, it is
important to set a strong, long-term signal for world
trade and against protectionism by concluding the Doha
round. The German government believes that developing
countries will not agree to further tariff cuts and has
therefore called on the U.S. to accept the current Doha
deal. The Ministry of Economics and German business
associations, including the Federation of German Industries
(BDI) and the Association of German Chambers of Industry and
Commerce (DIHK), are fully aligned in their position on
the Doha round.

3. (SBU) Dr. Axel Nitschke, Deputy CEO of the DIHK and
head of the division for international economic affairs,
told Econ Counselor that, even though some German
industry sectors (e.g., the chemical industry) are
asking for sectoral agreements, the DIHK sees the
overall package currently on the table as an acceptable
outcome that benefits the German economy as a whole.
Oliver Wieck, Chief of Foreign Trade, Economic and
Development Policy at BDI, said his organization was not
against sectoral agreements per se, but did not see them
as a sine qua non for an agreement. He noted that Doha,
like it or not, had originally been conceived as a
development round, and this has shaped the expectations
of the developing countries. Wieck remarked that, while
the U.S. appears to see the Doha as a half-empty glass,
Germany sees it as half full.

4. (SBU) Knut Bruenjes, the Ministry of Economics' Deputy
Director General on WTO Affairs, expressed frustration that
Germany, Europe's largest economy and the world's leading
exporter, has little influence on WTO negotiations, since as
an EU member it is not an authorized negotiator. The Germans
were also disappointed that USTR Kirk did not have time to
meet with the head of the German delegation, Ministry of
Economics State Secretary Dr. Bernd Pfaffenbach, but held
bilaterals with other countries with significantly smaller
economies.

5. (SBU) Bruenjes stated that talk of a new "G-2" (the U.S.
and China) has caused some unease with the Germans. He
encouraged the EU and the U.S. to consult closely with one
another about their approaches to China. The DIHK's Dr.
Nitschke was less alarmed about a "G-2," but noted that,
because of China's and the United States' enormous market
size, both countries have a great responsibility to move Doha
forward and address global imbalances. Nitschke also
advocated closer EU-U.S. cooperation on China, notably on
currency exchange rates. The BDI's Wieck said that, after the
recent U.S.-China summit revealed some fundamental areas of
disagreement, any worries he ever had about a "G-2" were
completely dispelled.

6. (SBU) COMMENT. The U.S. and Germany continue to disagree
on Doha. There seems to be no movement in the German
position, and the U.S.'s view seems to have no impact on them.
Both German government and industry continue to support the
current package despite its limited benefits for the German
economy. During a time of falling global commerce, as a
country highly dependent on foreign trade, Germany deems it
important to send a strong signal in favor of the world
trading system by concluding the Doha Round. Given the German
propensity, both in its own civil society and within the EU,
to seek consensus, it is unlikely that Germany will press
emerging economies for greater market access. This is
particularly true given the designation of Doha as a
"development round." The Germans consider it unrealistic that
the advanced developing countries will make further market
entry concessions at this point. END COMMENT.


BERLIN 00001605 002.2 OF 002


MURPHY
#

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