Wilf Stevenson on the opportunities and pitfalls of the EU-US Transatlantic Trade and Investment Partnership
Following the EU-US summit in November 2011, the European Commission and US Government announced that they had agreed to initiate negotiations for a free trade agreement called the Transatlantic Trade and Investment Partnership (TTIP).
The main aim of the TTIP is to create a comprehensive agreement that addresses a broad range of bilateral trade and investment issues, with the EU stating: ‘independent studies suggest an EU-US trade accord could generate enough growth and jobs to make families in the EU up to €540 better off each year. Consumers would also gain access to a wider range of high-quality products and services than ever before. And in many cases they'd pay less than they do now.’
The negotiations were ‘launched’ at the G8 summit at Lough Erne on 17 June 2013, with the first talks held that July. Negotiations have continued on a regular basis since then.
For Labour, while we regret the collapse of the World Trade talks which has prompted this new approach, the TTIP has huge potential and we very much support the principles behind these negotiations – job creation, higher wages for employees and a better deal for consumers.
Europe and the US are the UK’s most important markets. Indeed, the US is our biggest export market, with our economy attracting a significant level of Foreign Direct Investment from across the Atlantic. However, more can be done to make it easier – for example, tackling barriers and improving market access – for UK and US businesses to trade, and grow our respective economies. TTIP would do that.
Crucially, the benefits of any trade deal must filter down to employees and consumers. Labour would be very concerned if any deal led to a watering down of workers’ rights and we shall monitor this closely. Likewise, we want to see benefits obtained by businesses being passed onto consumers, whether through increased choice or reduced prices.
TTIP proves the point that the UK’s national interest lies in remaining at the heart of a reformed EU. That is why Labour will make the hard-headed, patriotic case, founded on the national interest, both for Britain in Europe, and for change in Europe. It is a shot across the bow for Eurosceptics, who ironically argue for this agreement yet say we must leave the EU at the same time.
Our concerns about the proposed agreement focus in particular on the need to protect public services, such as the NHS and Higher Education, from collateral damage. Under the draft treaty, only public services that are specifically excluded are protected, so it will be important to get the detail right. Concerns exist about financial services, as the US is very protective of their situation; and on audio-visual services. More generally, there are questions about workers’ basic rights: the US has ratified only two out of eight basic International Labour Organization conventions designed to protect workers, while all EU member states have adopted them. History suggests that free trade treaties tend to lead to ‘harmonisation’ around the lowest common denominator, so European workers’ fears of an erosion of their current rights may not be misplaced.
The government must set out what it thinks are the realistic chances of TTIP being agreed – not least because the necessary legislation has yet to be agreed in the US. Unless decisions are reached quickly, it seems inevitable that this Agreement will get snarled up in the next Presidential election campaign, and possibly lost forever.
Lord Wilf Stevenson of Balmacara is Shadow BIS Minister in the House of Lords
Published 17th June 2014
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