Trans-Atlantic Free Trade Agreement (TAFTA) & Trans-Atlantic Trade Investment Partnership (TTIP)By Isai Loen, Pil Ar Harera, & Francis Oheneba

Proposal to create a TransAtlantic free trade

area covering Europe and North America. 

What is TAFTA ?

We can put this in our last slide for conclusion, maybe!

What is it?

Transatlantic Free Trade Area is a proposal to create a trans-atlantic free-trade area covering Europe and North America The proposals have

been made since 1990, and in 2013 the TTIP was leaked

TAFTA=TTIP is an agreement between US and EU

The ultimate goal, once complete+CA+MX

Biggest free trade area

OBJECTIVE

Create converged standards in the social, technical and environmental field, as well as in security, settlement of disputes, access to medicines, justice, trade, labor code, protection of digital data and regulations in finance and

education

What happened before? 1950 – Jean Monnet (the father of the European Union) talked about a occidental block with the US, and in 1951 try to install the economic rules of war of US to EU

After WWII the economic bqrriers betzeen US and EU were already very low:-World trade organization-Open skies threat

The European Commision states the benefit of an agreement of free trade with US, +50% of profits

Constant friction between the white house and the European Commission

The Chancellor of Germany, Angela Merkel, promotes strongly this free trade in the 90’s. And in 2006 after the controversy of the free world commerce in Doha, she talks again with the world leaders about some kind of transatlntique business.

1990 – The transatlantique declaration1995 – Transatlantique business dialogue (Nouvel agenda transatlantique2007 – Transatlantique economic council (Merkel, Bush, Barroso)2011 – Strong close doors meeting between Obama and Barroso2013 – Leaked of TAFTA to the media

So…basically, we are talking about…

• The biggest trade threat ever in the history of mankind

• It involves two powers that combine together represents more than 40% of the PIB worldwide

• A trade that will represent a third of the commercials businness in the world

• Nowadays the negotiations are being held behind closed doors out of the public eye

• Its defenders argue that this threat will benefit the economic growth of the participants, it will increase the economic freedom and it will push new job creation

• Its opposers claim that in the future to come, companies will call the shots against governments and the citizens of the world, legalizing poisonous food, low standard education and all kind of free trades making rich the richest, and leaving poor the poorest.

Under wich regulations it will work,

american, the companies or european?

Why is secret? Will the civilians be able to

particiapte or even vote?

What’s going to happen if its philosophy

provides that the laws of the two blocks

meet the standards of free trade

established by the major European and

American companies?

The big picture

This could be part of the conclusion if you want or leave it in my slides, as u wish

The Implication of TAFTA / TTIP

• General consideration of the agreement • The impact in civil society and consumers• The relation to the third countries• Specific policies and trade issues included within TAFTA /

TTIP

General consideration of the agreement

Strengthen global competitiveness by

removing trade tariff barrier.

Reducing the attractiveness of

European Integration

Increase economic

growth and social gains

negative economic

effects for the countries

outside the TAFTA/TTIP

caused by the spillover

effect

“A future deal between the world’s two most important economic powers will be a game-changer. Together, we will form the largest free trade zone in the world. This deal will set the standard - not only for our future bilateral trade and investment but also for the development of global rules. It will create a tremendous impact on jobs and growth on both sides of the Atlantic. It is estimated that when this agreement is up and running, the EU’s GDP will get a half a per cent boost - which translates into tens of billions of euros every year. It is probably the cheapest stimulus package that can be imagined “

0,5 % of GDP growth and extra €545 / average

European Household

European Comission arguments on TAFTA / TTIP :

• Positive consequences for jobs and growth

• Will not lower safety, environmental and health standards

CENTRAL ARGUMENT

National IncomeConsumer Price

Increase Economic Growth & Social Gains

Strengthen Global Competitiveness

Average import duties between US and EU = 3 up to 4 %

Obstacle to export product to another country : • Quality standards • Technical requirements for imported products • Labeling requirements• Etc.

No TAFTA/TTIP = Trade tariff barrier

TAFTA/TTIP = Non-tariff barrierEU exports to the US would go up by 28%, equivalent to an additional €187 billion worth of exports of EU goods and services. The EU imports from the US will also increase by €159 billion.

Negative Economic Effect for Country Outside TAFTA/TTIP

50 % + TTP TTIP =

Global Regulatory Blue Print

TAFTA/TTIP

Country adopt TAFTA/TTIP

= Stay in competition

Country without TAFTA/TTIP

= Out of competition

Spillover effect :

*

*

Reducing attractiveness of European integration

With TAFTA/TTIP

Without TAFTA/TTIP

• Trade beetween : US – Germany = 90% US – UK = 60%(source: Bretelsmann Stiftung 2013)

• Trade between : EU – 3rd countries = Decline US – NAFTA = Decline

• Trade between intra EU = Decline European Integration heavily relies on treade relation would become weaker

Trade diversion - diversion from a more efficient exporter towards a less efficient one by the formation of a free trade agreement or a customs union.

The impact in civil society and consumer

Series of positions on various aspects on the TAFTA | TTIP negotiation: Legal Protection for People - instead of Privileged

Rights for Corporations Core Principles of Climate and Environmental

Protection Protect Small and Environment-friendly Agriculture High Consumer and Health Standards Labor and Human Rights International Solidarity and Cooperation Safeguard and Develop Public Services Protect and Promote the Diversity of Cultural

Expressions Financial Sector Regulation and a Reduction of

Economic Imbalances Innovation, Education and Freedom of Information

The relation to the third countries

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