Today, EU trade negotiators are meeting their US counterparts to begin the fifth round of talks for the largest free trade deal in history. One study carried out on behalf of the European Commission estimates that the agreement – known as the Trans-Atlantic Trade and Investment Partnership (TTIP) – could benefit individual households in Europe by over 500 euros each, generating millions of new jobs and €120 billion worth of additional economic output across the EU.
Trade tariffs between the EU and US are already low, so the most difficult part of the negotiations will concern alternative barriers to trade, including different approaches when it comes to regulation. Critics of the deal argue that TTIP will lower environmental standards and worker protection in Europe and could weaken democracy and national sovereignty.
With European Parliament elections taking place later this week, many of our commenters have concerns about the deal and might be wondering who to support. For example, we had one comment sent in from Matthias arguing that only big corporations will profit from TTIP. We took this question to Gabriele Zimmer, a German MEP and the Chair of the Radical Left group, for her to respond:
To get a different perspective, though, we also spoke to Karel De Gucht, the European Commissioner for Trade (whose party sits with the Liberal Democrats in the European Parliament). As one of the central figures in the TTIP talks, how would he react to Matthias’ comment?
In fact, the big advantage of this agreement with the United States is that it would be very good for Small and Medium-sized Enterprises (SMEs). It is not easy for them to become established in distant markets where there is no legal certainty and no rule of law. However, the big difference with the US is that they do have rule of law – there you can go to a court and get a fair ruling. This is very, very important for Small and Medium-sized Enterprises. Maybe such legal certainty is less important for big corporations – because for them, if they have a problem, they can ride it off in their next trimester’s report, but for SMEs this can be the end. So, opening up the US market is not just advantageous for the big corporations.
Next, we had a comment sent in by Nicholas who thinks that by focusing on the narrow economic impact of TTIP, we are missing the huge benefits in terms of influencing the global trade agenda. He believes TTIP will help the US and EU set the rules of international trade, ensuring fair competition with economies around the world. How would De Gucht reply?
I would say that the next big battle in trade is about norms, standards, regulations and disciplines. The US and EU together make up about half of the global economy. So, if we join forces, we are in a very good position to set the agenda worldwide for these new developments of norms, standards and disciplines. To give you an example of disciplines: to what extent can you give subsidies to a company? There is a real problem with China giving subsidies to its industries, for example. The way for Europe to be in the driving seat when setting international standards is to do it together with the US.
Finally, we had a comment from Marcel who fears that the EU-US trade deal will lower wages in Europe and damage environmental and worker protection. How would De Gucht respond to Marcel?
It will not do those things, simply because we are not going to allow that to happen. A classic example is hormones in beef – there will be no hormones in beef in the EU because of this trade agreement. The other one is GMOs – we are not going to attempt legislation with respect to GMOs through this trade deal. And when it comes to working conditions, we are not even going to discuss working conditions with the USA. So this argument is completely false, yet it is spreading like a kind of a virus. It is completely false and, by the way, that kind of agreement would never get through the European Parliament.
Do YOU think an EU-US trade deal would lower environmental standards and worker protection in Europe? Or would it boost both economies and provide millions of jobs? Don’t forget that the European Parliament has the right to vote on approving (or not) the EU-US trade agreement, so make sure you vote this week for the party YOU support in the European elections! And let us know your thoughts and comments in the form below, and we’ll take them to policy-makers and experts for their reactions.