October 15, 2015 12:23PM

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."

In her essay, Professor Egan describes the problem and offers some sensible ideas for moving forward.  She concludes:

The United States and European Union have an opportunity to improve the TBT regime through TTIP. In conjunction with trade association, government regulators, and international standards forums, negotiators should focus on how to achieve equivalency. TTIP affords the United States and Europe the opportunity to assert global leadership in setting rules for market access. This can happen only if both sides stop arguing over whose regime is better. 

If the TTIP negotiators fail, other trade and regulatory architecture, authored and agreed in other parts of the world, could emerge to fill the void, putting U.S. and EU producers on the outside looking in.

Other essays related to the conference can be found here.