TTIP - What Is It and How Will It Affect Us

The EU Trade Committee has drafted a series of recommendations re the TTIP negotiations. The text will be voted on by the EU Parliament on the 10th of June.  BREAKING NEWS 10.6.2015 : THE DEBATE AND VOTING ON TTIP HAS BEEN SUSPENDED!!
The European Commission has published a leaflet with the ´top 10 myths about TTIP´, most probably in response to attention raised in alternative media.

If you follow alternative media, you will have seen more frequent postings on TTIP and ISDS then in mainstream media, mostly by those against,  but I will try to provide some general and objective information. First of all, what do the acronyms stand for?

TTIP stands for Transatlantic Trade and Investment Partnership and the purpose is to remove the regulatory differences between the EU and the US.

ISDS stands for Investor to State Dispute Settlement. This mechanism is already included in many trade treaties and enables big corporations to sue indivual governments if those governments issue legislation that they feel puts them at a disadvantage or will influence their benefits negatively. The dispute will be settled by a small panel of corporate lawyers and many fear that the inclusion of ISDS in the TTIP will take away the possibilities of individual governments to protect their citizens´ rights or interests, some even going so far as stating this will be the end of democratic complaint as the hearings are held in secret and there is no possibility to appeal. Basically a privatised justice system for global corporations.

ttip acronyms

 

The ´against´ arguments concentrate mainly on the inclusion of the ISDS element, and on genetically modified food, animal testing in the farmaceutical industry, food safety  etc.  as they are accepted in the US and not in Europe. Under the TTIP those products should be allowed to be sold here as well. The regulations re food labelling are different too. In the US food labels do not have to include information re the inclusion of genetically modified food products, for example.

But those against also doubt the arguments put forward by the ´pro´ parties, on economic growth and increase in employment. Figures ranging from over a million more jobs, to a loss of 600.000 jobs are presented by either party. As with all statistics, the formula applied and the data used, influence the calculation and thus the expected result.

With regards to the TTIP, the calculations are based on ´taking away trade barriers´ equals less cost, leading to more trade /economic growth; economic growth equalling increased production so more jobs.  The main difference appears to lie with the expected economic advantage when trade barriers are eliminated. The ´pro´ parties estimate that trade barriers contribute to 17% of the extra cost of an internationally traded product, and that appr. 50% of that extra charge could be eliminated by the TTIP. The ´against´ parties estimate that only a very small percentage, nearer to 3% of the cost of a product can be influenced by government policy and that factors like language, culture and difference in currency form almost 30% of the extra costs, that will remain in place.

Another difference is the assumption that employees that are bound to lose their jobs in one sector, can easily find new employment in another sector that will experience a growth. One study assumes 100% re-employment, another practically 0%. One study predicts a loss of 600.000 jobs in Europe, and an increase in the US of 700.000 jobs.

And does economic growth indeed lead to more jobs? In the past decennia we have seen that increased trading often does not lead to more jobs and increased prosperity for many, but only for a small percentage of society.

So, not an easy task to try and interpretate those pro and contra arguments, based on projections for the future, especially as they are quite longterm, with expected results for 2027.

Should we even aim for an economy where growth is the highest goal, above all discussion? If you agree to that, then the TTIP has its advantages. If on the other hand, you feel that the intrinsic values of an economy, whether jobs, rules or cultural quirks, should be protected from this ´law of growth´ then you can question the desirability of the TTIP.

Then you can discuss the factual arguments pro or contra a specific trade barrier, instead of assuming that all trade barriers, under all circumstances, are wrong and should be eliminated. Because one particular European rule might be more useful than another.

Coming back to the ISDS, there is a lot of information available online about pending cases and if you are interested, you can easily find it. But just to provide some food for thought… with ISDS included in the TTIP a US cheese factory, or wine producer, could argue that the ´denominación controlée´of Stilton cheese or Bordeaux wine is not in their interest and that they should be allowed to produce Stilton cheese or Bordeaux wine as well… Sounds far fetched? Time will tell.

 

Please note: The information provided is based upon our understanding of current legislation. It is not legal advice but is provided freely to enable you to be properly informed. We recommend that if you are considering taking action, you should seek professional advice.

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