Tag: transatlantic

Is TTIP the European Union’s Last Chance to Right the Ship?

Harvard University Center for European Studies fellow John Gillingham doesn’t exactly make the case that the European Union is worth saving, but he argues in his Cato Online Forum essay that a successful Transatlantic Trade and Investment Partnership agreement is essential to its survival. Among last week’s Cato conference participants, Dr. Gillingham was perhaps the most skeptical that the EU would be able to get its act together and achieve success, arguing that TTIP’s fate will hinge less on the deal’s specifics and more on the politics of the EU, which are poisonous.

Put quite simply, the adoption of TTIP, as it is presently conceived by the negotiating parties, would put the EU back onto a course of liberalization, from which it swerved in the mid-1990’s, and thereby bring it abreast of the concurrent globalization process being driven by China and the United States. Within Europe, the Single Market, something only half-complete, would become a reality. State interventionism would be sharply reduced and international competitiveness restored. Will this happen?

To help answer that question, check out the collection of essays from Cato’s TTIP conference participants.

How TTIP Will Affect the Structure of Global Trade Policy

Swedish economist Fredrik Erixon, an authority on international trade policy, who heads up the Brussels-based think tank known as ECIPE (the European Centre for International Political Economy), was a big contributor to the discussions held this week in conjunction with Cato’s TTIP conference.  Among many other trade topics, Fredrik has written extensively on TTIP, the WTO, and how the former may impact the latter.

In his conference essay, Erixon agrees with alarmed, “pure” multilateralists that the TTIP will supplant the WTO as “the organising entity of future trade policy,” but explains why that is not necessarily a bad thing.  While he dismisses fears that the United States and European Union may be turning toward an arrangement that excludes the rest of the world, and explains how they will “leverage TTIP for global trade liberalisation,”  Fredrik does worry that TTIP – if it “succeeds” in the area of regulatory harmonization – will result in the export of failed regulatory policies to the rest of the world.

His concluding remarks on that topic: 

Currently, the differences between EU and U.S. regulations and regulatory approaches are far too wide for the TTIP to be a realistic candidate for setting the global rules in this area. But TTIP will likely push trade agreements further in the direction of prescriptive regulatory conditionality, making it harder for trade agreements in the future to advance global commercial freedom through deregulation and simple, transparent rules.

Read Erixon’s essay here; see him discuss the issues during this conference session; see all the conference essays here.

What Is Meant by “Technical Barriers to Trade” and How Might TTIP Reduce Them?

One of the best presentations at the Cato TTIP conference on Monday was given by Michelle Egan, a professor at the American University’s School of International Service. Professor Egan managed to explain (in about 15 minutes) one of the most complex and possibly intractable subjects under negotiation in the Transatlantic trade talks: Standards-related trade barriers.

A major objective of the TTIP (as well as the TPP and other modern trade agreements) is to reduce “non-tariff barriers” (NTBs) of which so-called “technical barriers to trade” (TBTs) are an important subset. It turns out that differing product standards, which can act as TBTs, are more common than any other kind of NTB. According to Egan, “Governments, on average, impose TBTs on 30 percent of products. For firms active in international markets, different national requirements from conformity assessment measures can impede access to foreign markets.”

Be Careful to Not Misuse the Economic Estimates of the Costs and Benefits of Trade Agreements

Cato Senior Fellow Dan Pearson is the author of today’s Cato Online Forum essay, which explains the value and limitations of the International Trade Commission’s economic assessments of trade agreements.  Too often, parties opposed to trade liberalization misappropriate the estimates in ways that raise doubts about the integrity of the models. Dan’s conclusion: 

Supporters of trade liberalization should be prepared to counter those who would misinterpret the economic analysis of trade agreements in order to advance anti-trade arguments.  Yes, trade liberalization will produce both winners and losers.  But credible analysis clearly indicates that making markets more open and competitive will lead to improved resource allocation, expanded international trade, greater economic growth, and higher consumer welfare.  Those objectives are genuinely worth pursuing. 

The essay is offered in conjunction with a TTIP conference being held at the Cato Institute on Monday, October 12. Read it. Provide comments. And please sign up to attend the conference.

A Case for Making TTIP Better for Workers

In today’s Cato Online Forum essay, George Washington University Professor of Foreign Affairs Susan Ariel Aaronson argues that the “TTIP provides an opportunity to think differently about how policymakers in advanced industrialized economies can protect labor rights, encourage job creation, and empower workers.”  After describing some of the concerns workers have about the TTIP and explaining why certain parts of the agreement could serve to undermine labor rights, Susan provides some fresh recommendations for making the TTIP more appealing to workers.

Read it. Provide feedback.  And register for Cato’s October 12 TTIP conference.

 

Mismatch Between 20th Century Trade Negotiations and 21st Century Trade Threatens TTIP’s Success

In today’s Cato Online Forum essay, Per Altenberg from the Swedish Board of Trade makes an interesting political economy argument and a compelling practical case for why the Transatlantic Trade and Investment Partnership will be a tough slog. Altenberg argues that the old model for trade negotiations, premised as it is on mercantilist reciprocity, which leverages the interests of exporters against import-competing industries to secure domestic support for liberalization, is no longer functional in a world where trade is dominated by intermediate goods trade along global value chains. Today, openness to trade is seen as essential, and trade negotiations cover matters that probe deeply into domestic regulatory space. To sum up, Per writes:

Traditional 20th-century reciprocity in market access negotiations will thus not be an effective mechanism in the context of 21st-century deep integration negotiations such as TTIP. Instead, deep integration issues require new approaches to trade negotiations.

Per’s essay elaborates on those approaches.  Read it.  Provide feedback.  And please register for Cato’s TTIP conference on October 12. 

Europe Must Abide TTIP’s Geopolitical and Security Implications

In today’s Cato Online Forum essay, Judy Dempsey of Carnegie Europe argues that the geopolitical and security implications of TTIP are immense, and that the EU and its member states need to wake up, smell the coffee, and acknowledge reality. This is the third essay focused on the geopolitical implications of the TTIP published in conjunction with the Cato Institute conference taking place October 12.  Previous essays – to compare and contrast – were written by Phil Levy and Peter Rashish

Read them. Provide feedback.  And please register to attend the conference.