Parliamentary Committees and Public Enquiries
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UK must act to save "biggest trade deal in history"
Negotiations on an historic trade deal between the European Union and the United States are losing momentum and must be revived, according to a Lords report out today.
The report describes the deal, the Transatlantic Trade and Investment Partnership, or TTIP, as being both the most ambitious trade and investment pact ever attempted and an opportunity to revitalise the relationship between Europe and the US. It also represents a chance for the two together to set a template for a new generation of 21st century trade and investment agreements.
- Report: The Transatlantic Trade and Investment Partnership (HTML)
- Report: The Transatlantic Trade and Investment Partnership (PDF)
- Inquiry: The Transatlantic Trade and Investment Partnership
- EU Sub-Committee C: External Affairs
Report
As the EU and US combined account for nearly half of world GDP, the potential gains from such a deal could be substantial – as much as £100bn a year to the EU and £80bn to the US according some estimates. While warning that such figures must always be treated with caution, the committee believes that a deal would provide a substantial boost to employment on both sides of the Atlantic as well as benefiting consumers by widening choice and increasing competition. This would then lead to lower prices than would otherwise have been the case.
It argues that while getting rid of the remaining tariffs on transatlantic trade is important, some 80 per cent of the potential gains will be derived from the removal of non-tariff barriers, a point of particular significance for SMEs.
The committee says that a successful TTIP will be of benefit to the rest of the world by stimulating world trade in general and encouraging progress on other multilateral trade initiatives. It suggests that this will encourage China to play a more active role in these initiatives. It also argues that TTIP should not be a closed shop and that there should be provision to allow third countries to participate.
But it warns that without more political impetus from Washington and the big EU member states and without a concerted campaign to make the public in all the countries involved more aware of the potential benefits, the opportunity could be lost. If that happens the EU and the US are unlikely to be in the same position of influence in the world economy next time around.
Chairman of the Committee
Commenting on the report, the Chairman of the Committee, Lord Tugendhat, said:
"As these negotiations were launched at the 2013 G8 summit chaired by the Prime Minister, the British government has a big interest in helping to ensure that they are brought to a successful conclusion. The best chance of achieving this will be when the new Commission, that conducts the negotiations on behalf the EU, has been installed and after the mid-term elections in the US.
A successful conclusion does not mean that everything has to be wrapped up at the same time. As with the Single Market some elements could come into immediate effect, while others are progressed within an agreed framework and according to an agreed timetable.
Our message to the UK government is clear. Building on the all-party support for TTIP in Parliament it needs to work on two fronts: on the one hand it must commit more energy to spelling out the potential benefits to the public and to small businesses in this country. On the other it must encourage other European governments to do the same and actively support the Commission’s efforts to ensure that Europe presents a united front."
