Transatlantic Trade and Investment Partnership (TTIP) Negotiations

0/5 ( ratings)

In February 2013, U.S. and European Union leaders announced plans to negotiate a comprehensive and high-standard free trade agreement between the United States and the EU, referred to as a proposed Transatlantic Trade and Investment Partnership . Formal negotiations commenced in July 2013, and three rounds of negotiations have been held to date, and a fourth round is scheduled for March 2014. If concluded as envisioned, TTIP could be the largest FTA in the world in terms of economic size and serve a number of strategic U.S. policy goals.

Congress, which has the constitutional authority to “regulate commerce with foreign nations,” has a direct interest in the TTIP negotiations, both through influencing U.S. trade negotiating objectives and considering implementing legislation for any final TTIP agreement for it to enter into force. Congress also may consider legislation to renew Trade Promotion Authority , which expired in 2007, to further define U.S. trade negotiating objectives and provide expedited legislative procedures for the consideration of a bill to implement a final TTIP agreement. The TTIP negotiations may raise debates among Members of Congress on the role and direction of U.S. trade policy, as well as the costs and benefits of trade liberalization.

The United States and EU share a large, dynamic, and mutually beneficial trade and economic relationship. The two sides account for nearly half of world gross domestic product and 30% of global trade, and have investments of more than $3.7 trillion in each other’s economies. Although both partners have relatively open markets, many observers assert that the relationship has not reached its full economic potential. Concerns about slow growth, job creation, and increased competition from emerging markets have prompted calls from stakeholders on both sides of the Atlantic for a renewed focus on addressing remaining barriers to U.S.-EU trade and investment.

TTIP aims to enhance market access through the elimination of barriers to trade and investment in goods, services, and agriculture. Core components of the negotiations include:

• eliminating tariffs between the United States and EU;

• enhancing regulatory cooperation and compatibility;

• opening services and government procurement markets; and

• strengthening and developing new rules in areas such as intellectual property rights , investment, trade facilitation, labor, the environment, and emerging “21st century” issues .

Regulatory issues are a primary focus of the negotiations and may be among the most difficult to address. Since the transatlantic foreign direct investment relationship is significantly larger than the trade relationship, another key objective of the negotiations is facilitating transatlantic investment flows. The comparable economic size and advanced development of the two trading partners could make the TTIP negotiations distinct from most other FTAs each one has negotiated with other countries.

Prospects for TTIP are heightened because U.S. and EU policymakers and other stakeholders see potentially significant benefits flowing from a successful TTIP, such as:

• strengthening the overall U.S.-EU strategic relationship, including transatlantic economic relations;

• boosting transatlantic economic growth and jobs by reducing costly tariff and non-tariff barriers that decrease the competiveness of the U.S.