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The European Union was "a bit disappointed that we didn't come very far" in the second round Open Skies talks with the United States that began last week in Ljubljana, European Union ambassador to the United States John Bruton told attendees to this week's Association of Corporate Travel Executives conference here.
The next negotiating round is scheduled for late September and if no agreement is reached then, Bruton acknowledged, the matter would need to be addressed by the next U.S. administration.
As part of the negotiation process for the second round of Open Skies, the European Union has been "having a number of talks with the U.S. Congress." Most recently, it "tried to convince Congressman [James] Oberstar (D-Minn.)," that cabotage "could be good for consumers," as competition could result in lower fares, not necessarily loss of service to smaller airports, Bruton said.
Cabotage is the term used to describe authority to transport passengers or cargo between two points within the same country. Non-U.S. carriers are currently barred from doing so inside the United States.
"Our experience is with Ryanair flying to places that no one every heard of 10 years ago," Bruton said. "On the contrary, I think cabotage and consolidation that might result from it, would actually lead to better service, not less. But persuading the U.S. political system in the current protectionist mood is asking them to take a leap of faith."
Bruton said that the "European Union wants to be able to have complete access to all the airports of the United States for European airlines. We don't want restrictions on who we may pick up, who European airlines may buy in terms of U.S. airlines. We want a free market as far as aviation is concerned. In particular, we want the opportunity of buying larger shareholdings in U.S. airlines."
Bruton acknowledged that this last point is a "little controversial in the United States, as many see their airlines as part of national security." However, Bruton argued, U.S. laws are enough to ensure national security.
The European Union also wants the right to bid on the business travel of the United States government, just as U.S. airlines today have the right to bid on business travel of European government travel. U.S. negotiators want the European Union to impose a "single regime for all airports in the E.U.," concerning noise and flying at night--rules that today are dictated by each country.
"The European Union wants to see visa-free access for European citizens from all 27 E.U. states," to the United States, Bruton said. While most citizens of Western European states enjoy visa-free access to the United States today, newer E.U. member states including "Poland, Latvia, Lithuania, Greece, Hungary, Slovakia and countries like that--don't enjoy visa-free access for their citizens. That restricts travel by people from those countries on business or pleasure to the United States," Bruton said.
Another point of contention, Bruton said, concerns the U.S. government's plans to "introduce control on exit of people from the United States. At the moment, there is control on people coming in, but there isn't an equivalent checking on people as they leave the United States." While Bruton suggested that counting exiting visitors "is a sensible enough thing to want to do," he noted that the U.S. plan would "ask the airlines to fingerprint everybody on the way out."
Bruton said E.U. is concerned not only with the expense of the proposed process--"estimated to add $3 billion to $4 billion in costs to the airlines and, in turn, to their customers"--but also the increased vulnerability to terrorist attack for those standing in new lines to exit the country. The European Union favors remote check-in, he explained.
During the conference this week, ACTE joined with the International Air Transport Association in opposing the U.S. Department of Homeland Security's biometric exit procedures at airports. The organizations cited the "substantial financial hardship," estimated by other industry groups at $300 million to $4 billion.
Bruton highlighted other differences between the government views of aviation, including the inspections required by the United States of European aircraft repair facilities that already are certified by government inspectors in each country. The United States wants its airlines to pay for U.S. inspections of such facilities, Bruton said, which would again increase costs to the airlines and travelers. Europeans want the certification of one government to be accepted and sufficient for other government bodies.
On climate, Bruton said the European Union wants aviation to be added to the cap-and-trade system that it has imposed on the steel industry, oil refining and other areas, whereby "people to buy the credits to pollute if they go above their levels." While aviation contributes an estimated 3 percent of global carbon emissions, "Aviation emissions are growing much faster than other emissions," he explained. "The U.K. has estimated that U.K. aviation emissions only will quadruple by 2030. Since 1990, aviation emissions have increased by 97 percent."
But the European regulators also are concerned that "we're developing an aviation culture," in which people are dependent on flying several times a year, similar to the dependence on cars, Bruton continued. "The E.U. wants to ensure that we act to put some limitations on the growth of a lifestyle that will be climate destroying."
The European Union also would like to see the United States develop high-speed trains and other alternatives to aviation, and improve the safety and efficiency of travel by road. "The average miles-per-gallon efficiency in Europe is twice that of the United States," Bruton noted.
Generally, Europeans also are concerned by the "protectionist voices" heard in the presidential election debates, Bruton said. "If that protectionist sentiment would really catch hold ... it would undermine the three pillars upon which globalization rests and which I suggest your businesses rest: freedom of trade, freedom to invest and freedom to convert from one currency to another. It is difficult in a way to understand why protection sentiment is so strong in the United States at the current time. One estimate is that globalization has been worth $1 trillion in benefits to the U.S. economy--$10,000 per American household." He also noted that "57 million Americans work in businesses that are engaged in international trade. Anything that would restrict international trade would put some of these jobs at risk."
Globalization, Bruton continued, "has created a society where more of the people of the world have a stake in the continuing peace and prosperity of others. For those reasons, people--particularly in your business, one that depends so much on facilitating communication--should speak up against protectionism and in favor of a more forward-looking approach to the future of the world."
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