transatlantic trade & investment partnership
glyn moody
transatlantic trade
EU+USone half world's GDP
one third of world trade flows
EUUS trade 500bn (2012)
trade agreement to reduce costs
tariffsunder 3%
TTIP is not a traditional trade agreement (except in its lack of
transparency)
non-tariff barriers (NTBs)
different regulations in EU, UShealth, safety, environment,
labour, financial
EU bans on GMOs, chlorine washing for chickens, hormones in
beef; greater data protection
for citizens welfare enhancing
cultural expressions
for TTIP: "trade irritants"
tackling NTBs
levelling down - EU says no
levelling up - US says no
mutual recognitionchemicals in cosmetics1300 ingredients banned
in EU
11 ingredients banned in US
1289 chemicals banned in EU could be used in US products sold
here
(future) convergence
regulatory council
"living agreement" - De Gucht
"Horizontal Chapter on Regulatory Coherence"
"impact assessment/cost benefit analysis on proposed regulatory
measures covered by this Chapter, should assess impacts on
international and in particular transatlantic trade"
dilute/block legislation at a very early stage
investor-state dispute settlement (ISDS)
basic idea is to protect investors from arbitrary government
actions or weak court systems in developing countries
achieved by allowing companies to take action directly against
governments
using specialist external tribunals3 lawyers, meeting in
secret
ISDS (1)
over 500 cases (since 1987)Ecuador - oil contract ($1.77bn)
Germany - phasing out nuclear power (3.7bn; Energy Charter)
Canada fracking ban ($250m)
Canada - Eli Lilly patents ($500m)
Australia, Uruguay adding warnings to cigarette packs ($2bn)
2013 saw 57 more; Czech Rep. (7), Spain (6), Croatia (2),
Hungary (2), Slovakia (2), Greece (1)
ISDS (2)
EU - fracking, GMOs, pesticide bans; labour laws; software
patents etc
14,400 US companies with 50,800 European subsidiariesISDS a
ticking trade time-bomb
even European Commission trying to "improve" ISDS
chilling effect on future policyCanada's experience under
NAFTA
do we need ISDS?
"US investment in the EU is 3 times higher than in all of
Asia"
"EU investment in US is around 8 times the amount of EU
investment in India and China together."
US invested 1.3 trillion in EU
EU invested 1.4 trillion in US
no problem to solve; no need
insurance (World Bank)ISDS = socialisation of risk
TTIP benefits (1)
Bertelsmann Stiftung (June 2013)"The leveling of the barriers
with the USA thus leads to a decline in trade that came about as a
result of preferential treatment of intra-European trade flow"
intra-EU exports fall by 25%-41%
drop by 650bn/year
TTIP would hollow out the EU economically
TTIP benefits (2)
Centre for Economic Policy Research (March 2013)for European
Commission
tariffs only: extra EU GDP of 24bn - 0.1% of GDP
ambitious comprehensive: 50% of "actionable" NTB removed
extra EU GDP of 119bn - 0.48%
extra 90bn for US GDP, extra 100bn for rest of world
TTIP benefits (3)
"ambitious comprehensive" forecast gives extra 0.48%
in *2027* - 0.48% is cumulative GDP boost over 10 years
GDP growth is measured year-on-year - how much GDP goes up *in a
year* (UK 2013: 1.7%)
on average, extra GDP growth per year resulting from TTIP will
be O.05%
TTIP costs
OFSE report (31 March 2014)for GUE/NGL (Group of the European
United Left/Nordic Green Left)
forgone tariffs - 30bn
labour adjustment costs - 10bn
forgone tax income and social security contributions - 7bn
ISDS - billions of Euros
social costs of regulatory changehealth costs, ecosystem costs,
amenity loss, cultural loss
is it worth it?
[email protected]
@glynmoody on Twitter/identi.ca+glynmoody on Google+
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