The California Chamber of Commerce is urging United States and European Union leaders to advance the largest regional trading and investment relationship in the world.
U.S. and EU leaders are in Brussels this week to negotiate the Transatlantic Trade and Investment Partnership (TTIP). Business and government leaders from the United States and the European Union also regularly participate in the Trans-Atlantic Business Dialogue to discuss priorities for eliminating trade and investment barriers across the Atlantic. In fact, this meeting between Europe and the United States marks the eighth round of trade and investment talks.
In the latest CalChamber Capitol Report, Susanne Stirling, CalChamber vice president of international affairs explains that although these negotiations have been ongoing since 2013, with new EU officials in place, there is a sense of a fresh start for these particular negotiations, which will create new opportunities for a range of companies.
“The California Chamber of Commerce is pleased to support these negotiations in that it will create new opportunities for companies ranging from automobile manufacturers, pharmaceutical industries and medical devices,” Stirling says. “In fact, the European Union with its 28 member nations and the United States has the world’s largest trading and investing relationship in the world and as the TTIP negotiations progress,we will hope for new, better and more jobs on both sides of the Atlantic.”
Transatlantic Trade and Investment Partnership: TTIP
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. Together, the European Union and the United States are responsible for 11.5% of the world’s population, nearly half of global gross domestic product (GDP), 30% of global merchandise trade, and 40% of world trade in services. 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 506.7 million people, and has a total GDP of $17.4 trillion. The United States has more than 316.1 million people and a GDP of $16.8 trillion.
Total bilateral goods trade between the European Union and United States was nearly $650 billion in 2013, with the United States exporting $262 billion worth of goods to EU member nations.
California exports to the European Union in 2013 totaled $28.2 billion. California is one of the top exporting states to Europe, with computers, electronic products and chemical manufactures as the state’s leading export sectors to the region. EU countries purchase roughly 17% 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 and 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 and GDP in the long term, benefiting industries ranging from chemicals to automakers. EU-U.S. commercial links are unrivaled. 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.
The CalChamber is supportive of Europe and the United States continuing trade talks to deepen the world’s largest trading relationship with a focus on trade and investment initiatives, including:
- eliminating tariffs on trans-Atlantic trade in goods;
- establishing compatible regulatory regimes in key sectors to address regulatory divergences that unnecessarily restrict trade;
- agreeing on bilateral investment;
- liberalizing cross-border trade in services, without exclusions; and
- bilateral expansion of government procurement commitments.
For more information on the importance of TTIP, visit the international website here.
Staff Contact: Susanne Stirling