The United States remains fully engaged and is as committed as ever to the successful passage of Transatlantic Trade and Investment Partnership (TTIP), said Chief Negotiator for the United States Dan Mullaney during the 15th round of negotiations for the agreement recently.
The California Chamber of Commerce is actively urging the California congressional delegation to support the agreement to further enhance the largest regional trading and investment relationship in the world.
The negotiators made good progress in resolving conceptual and language differences in several negotiating areas during this round. Notable advances were made customs and trade facilitation, good regulatory practices, regulatory cooperation, technical barriers to trade, and regulatory compatibility in key sectors, like autos, pharmaceuticals and medical devices, Mullaney said.
“As a result, we’re close to agreement on a range of steps to make our regulatory systems and customs controls more compatible, reducing unnecessary and costly burdens on trade and increasing efficiencies for our regulators – all to the ultimate benefit of consumers,” Mullaney said at a news conference in New York.
All total, more than 20 different negotiating groups met during this round. The negotiators also achieved forward movement in investment, state-to-state dispute settlement, cross-border services, financial services, government procurement, environment, labor, agriculture, including market access and sanitary and phytosanitary (SPS) measures, industrial tariffs, energy and raw materials, small- and medium-sized enterprises (SMEs), and legal and institutional issues
The European Union (EU) consists of 28 countries: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, Sweden, the United Kingdom, and new members Croatia, Hungary, Poland, Estonia, Lithuania, Latvia, the Czech Republic, Slovakia, Slovenia, the Mediterranean Island of Malta and Cyprus, Bulgaria and Romania
The EU presidency rotates with each member country taking turns for six months at a time as chair of EU meetings and representing the EU at international events.
The trans-Atlantic economic partnership is a key driver of global economic growth, trade and prosperity, and represents the largest, most integrated and longest-standing regional economic relationship in the world. According to a 2016 study by the World Trade Institute and the AmCham EU, the EU-US relationship supports a combined 15 million jobs and over $4.8 trillion in investment, and represents over 40 percent of global GDP. The trans-Atlantic relationship defines the shape of the global economy as a whole; either the European Union or the United States also is the largest trade and investment partner for almost all other countries.
According to the World Bank, the EU market represents 509.7 million people, and has a total GDP of $16.23 trillion. The United States has 321.4 million people and a Gross Domestic Product of $17.95 trillion.
Total bilateral trade between the European Union and United States was $698.7 billion in 2015, with the United States exporting $272 billion worth of goods to EU member nations.
California exports to the European Union in 2015 totaled $29.2 billion. California is the top exporting state to Europe, with computers, electronic products and chemical manufactures as the state’s leading export sectors to the region. EU countries purchase roughly 17.6% of all California exports. For California companies, the single market presents a stable market with huge opportunity.
Tariffs on goods traded between the U.S. and the EU average less than 3%, but even a small increase in trade could have major economic benefits. U.S. trade with Europe is much larger than with China.Although there are numerous issues such as agricultural subsidies, privacy, aircraft subsidies, obtaining agreements on issues such as uniform car safety testing could be a huge benefit.
A free trade agreement could increase economic output by 122 billion euros ($158 billion) a year for Europe alone and add 0.52% to the EU’s GDP in the long term, according to European Commission estimates, benefiting industries ranging from chemicals to automakers. EU-U.S. commercial links are unrivaled. Trans-Atlantic trade in goods and services is worth $700 billion a year. Total U.S. annual investment in the EU is higher than in all of Asia, while EU investment in the U.S. far outstrips EU investment in India and China combined.
According to the U.S Trade Representative’s Office, the United States and the European Union are the world’s largest sources and destinations for foreign investment. Trans-Atlantic investment benefits companies and workers by creating high-paying jobs, boosting exports, and spurring innovation in both the United States and the European Union.
“The reasons to continue these talks are as strong as three years ago when we started negotiating this biggest bilateral trade agreement in the world,” said Chief Negotiator for the European Union Ignacio Garcia-Bercero.
Garcia-Bercero explained there is a very strong rationale to agree on strong regulatory cooperation between the EU and the US. There are three main reasons for this:
- First – Because it will benefit our companies, especially the smaller ones. When we talk to them, they often tell us they don’t have enough time or money to sometimes even understand what these differences are between regulations; contrary to the big firms who can afford that.
- Second – because it will promote more effective regulations to the benefit of citizens. Closer cooperation with the US would make our regulation more effective. Regulators that work together can learn from each other’s ideas, reduce costs and come up with better solutions. When new technologies arrive, as they do every day, regulators need as much information as possible. By working together they can share research, expert perspectives and best practices. Working together can save governments time and money, which they can then deploy on better enforcement, rather than doing redundant tests or inspections.
- Third – because it will help us to shape global regulations to the benefits of consumers. Where TTIP would lead to shared approaches, those are more likely to be followed around the world, meaning a regulatory race to the top rather than a race to the bottom, as both the EU and the US are probably the most sophisticated regulatory regimes on the planet.
Regarding the next steps in the process, negotiators will report the progress they have achieved back to their respective politicians, and then they will decide on the next steps.
On the EU’s side the trade ministers will meet again on November 11. In the meantime, the EU’s head of states at European Council will have a discussion on trade issues, including on the state of play of the negotiations with the United States.
CalChamber is urging businesses to contact the California congressional delegation and tell them to support the Transatlantic Trade and Investment Partnership (TTIP).
For more information on TTIP, visit the CalChamber international portal page, www.calchamber.com/TTIP.
Staff Contact: Susanne T. Stirling