In June 2013, the United States announced they would start negotiations for the Trans-Atlantic Trade and Investment Partnership (T-TIP), a free trade agreement, with the European Union (EU). It has been little over 3 years, and U.S. and EU officials have just finished the fifteenth round of negotiations. There are likely to be more rounds in the future, but here is what we know about the T-TIP so far.
Countries Involved in the T-TIP
The T-TIP is being discussed by
- The European Union which includes, Austria, Belgium, Bulgaria, Croatia, Republic of Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, the United Kingdom; and
- the U.S.
What is the Goal of the T-TIP?
This partnership is meant to expand trade and investment between the United States and EU, along with increase economic growth, jobs, international competitiveness, and address common global issues. The Office of the United States Trade Representative (USTR) has made it clear that with this agreement, the U.S. is looking to eliminate all tariffs and duties on agricultural, industrial, and consumer products in order to level the playing field and promote trade.
In a letter to U.S. Trade Representative Michael Froman, the Senate Committee on Finance Chairman, Orrin G. Hatch, and the House Ways and Means Committee Chairman, Kevin Brady, explain that these two congressional committees continue to support the negotiations by agreeing that “a comprehensive T-TIP will open markets for more than 28 million American businesses, support the creation of more and higher paying jobs on both sides of the Atlantic, and further deepen a decades-long relationship with one of our most important trading partners.” With these two committees backing the T-TIP, there’s a chance that this partnership will continue to be discussed, despite the lack of support on free trade from both presidential candidates.
Who Will this Affect?
U.S. exporters will benefit most from this agreement due to the removal of tariffs, which will hopefully boost the quantity of products sold to Europe. For instance, by removing tariffs, olive oil would no longer be subject to $1,680 in duties per ton on shipments to the EU, according to the USTR. Another example would be exporting apples from the United States. U.S. apples are subject to more than seven percent in duties when shipping to the EU; however, apples exported from the EU and shipped to the United States, are not subject to duties. Eliminating the remaining duties on our exports will create new opportunities to sell American goods and for global competition.
The Progress
After the 15th round concluded on October 7, some progress was made with the agreement but there are still areas that need further discussion. The EU’s Chief T-TIP Negotiator, Ignacio Garcia-Bercero, commented on what topics were brought up this round, such as: cars, pharmaceuticals, chemicals, cosmetics, information and communication technologies, pesticide, engineering, medical devices and textiles. Garcia-Bercero expressed that there was positive progress with those topics and gave an example of the mutual agreement on good manufacturing practices in regards to pharmaceuticals.
As of now, it looks like the goal to finalize the agreement before the end 2016 will not be achieved, since there is a significant amount of negotiations that still need to be made. If the U.S. and the EU are unable to conclude the T-TIP by the end of this year, moving forward with the agreement may become difficult, as both presidential candidates have strong criticisms of free trade.