TTIP: Linchpin to Largest Trade Zone

The online version of the newspaper The Independent UK reads, “The European Commission is making the secret Transatlantic Trade and Investment Partnership (TTIP) trade deal even more secret, introducing a new rule that means politicians can only view the test in a secure ‘reading room’ in Brussels”. This was post a series of leaks regarding the agreement supposedly by European Union member states that accessed the information electronically. You just need to Google TTIP and the number of news updates that flood your screen is overwhelming. But what is TTIP? What does it aim to accomplish? What are people’s reactions to the process so far?

TTIP, acronym for Transatlantic Trade and Investment Partnership is a bilateral trade agreement between the European Union and the United States of America. This is not the first agreement that the two partners have engaged in. They have had a long standing membership in the World Trade Organisation (WTO) along with the recent EU-US Open Skies Agreement which allows any airline (both EU and USA) to fly between any point in the EU and any point in the US. For the United States, TTIP is a reflection of Trans-Pacific Partnership with several Pacific Rim countries, with India being a possible future member.  The negotiations regarding the agreement are taking place between the European Commission (on European Union’s behalf) and the Office of the United States Trade Representative (on United States’ behalf).

This agreement aims to regulate and synchronise trade between the two partners. Its main objective is to create a free the world’s largest trade zone (covering almost 46% of world GDP) by reducing tariff barriers to zero and non-tariff barriers by 25%-50%. 60% of the global GDP, 33% of world trade in goods and 42% in services is accounted by the United States and the European Union.  Moreover, it has been reported that both partners are said to gain tremendously from this agreement. The European Union’s economy is said to increase by 120 billion Euros and United States economy by 95 billion Euros.

TTIP would also lead to the creation of ISDS, acronym for Investor-State Dispute Settlements. This will allow various corporations to sue governments in case of loss caused (supposedly) by policies implemented by them. The fear lies in the fact that, this would leave a lot of power in the hands of multinationals which could lead to them controlling the government.

TTIP has received a lot of criticism from activists especially in Europe who believe that this agreement would compromise the quality of the goods and services provided. For example, the United States allows the sale of cosmetics that have been animal tested by Europe doesn’t. Moreover, there has been mounting pressure by the United States on the EU to drop a particular criterion in the agreement that bans a number of pesticides containing endocrine disrupting chemicals.  A lot of controversy surrounds the agreement; however there are high hopes from TTIP.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s