Big Cities Benefit from Free Trade – so why are Democrats Stalling it?
In her article, Nina Easton wonders why some labor unions are still opposing the conclusion of TTIP and TPP when it is exports that has been boosting post-recession economic gains and job growth in big cities. Data shows that, in the first two years of recovery, exports grew at five times the rate of output in America’s 100 largest metro areas and made up for more than half of those cities’ economic recovery. As America’s big cities have prospered under existing trade agreements, trade–especially with their NAFTA partners Mexico and Canada–has grown significantly in recent years, she concludes that the American economy and especially its workforce will benefit greatly from TTIP and a freer global marketplace. (Fortune)
News
Economists Point to Emerging ‘Draghinomics’
John Thornhill in Cernobbio and Claire Jones of the Financial Times report welcomed the European Central Bank’s proposed policy changes to first cut interest rates and then start future purchases of asset-backed securities in order to avoid Eurozone deflation. Nouriel Roubini, a professor at NYU, termed the ECB’s emerging policies as “Draghinomics” because of its similarity to Abenomics in Japan, and similar insistence on structural reforms coupled with monetary easing. (Financial Times)
De Gucht Rejects Claims Commission Misrepresented Benefits of TTIP
After accusations that the European Commission had overstated the economic benefits of a transatlantic trade deal, EurActiv details the rebuttal of European Trade Commissioner Karel De Gucht who explains that high estimates were reported along with language that corresponded with an ambitious agreement. De Gucht also acknowledges the complexity of presenting highly technical data results as general information for a nontechnical audience, but assures that his department will try to be clearer when publicizing the advantages of TTIP in the future. (Euractiv)
Dollar Closes in on Three-Year High
Thomas Hale of the Financial Times reports that the dollar has gained substantially in recent days thanks to growing market concern about political risks as diverse as Russia’s incursion into Ukraine, ISIS, and the possibility that Scotland will declare independence. (Financial Times)
House Republicans Eye Short-Term Renewal of Export-Import Bank
Cheyenne Hopkins and Roxana Tiron of the Insurance Journal report that Republican leaders in the House are considering a several month extension of the 80-year-old US Export-Import Bank that is set to expire this month. The short-term extension would shift the contested debate until after the November elections; however, it would continue private sector uncertainty until a long-term solution can be found. (Insurance Journal)
Russia Aims to Choke off Gas Re-Exports to Ukraine
Christian Oliver and Courtney Weaver of the Financial Times report that Russia is seeking to prevent its European consumers from re-exporting Russian gas to Ukraine, possibly by reducing export volumes to EU countries. Ukraine has relied more heavily on re-exports of Russian gas from EU countries to compensate from the lack of gas directly from Russia. Reductions of Russian exports would raise the risk of price spikes and supply disruptions throughout the European Union. (Financial Times)
Recent Analysis
European Commissioner: We Need a Trade Deal with the US
This CNBC article features an interview with Jyrki Katainen, a former Finnish prime minister who is in the running for a vice presidency of the European Commission. Katainen, who currently serves as the European Commissioner for Economic and Monetary Affairs, underlines the importance of a transatlantic agreement: “These are the issues which could help all of Europe increase competitiveness, increase competition, and this is the way we get more jobs…We need more opportunities for our small and medium-sized [companies], but also for the bigger companies, to go to the US market.” (CNBC)
States, Investors, Disputes
In his opinion piece, Frederik Erixon addresses the European Commission’s consultation procedure concerning the Investor State Dispute Settlement (ISDS) which might pressure the EU to exclude ISDS from TTIP negotiations. Taking the example of the famous “Repsol case” of uncompensated nationalization of the energy company in Argentina, the author shows that the current system of international investment arbitration needs improvement. The author makes a strong case for the inclusion of ISDS, claiming that if the procedure is taken out of TTIP negotiations, investment disputes will still be handled – it will just mean a much higher level of politicization of the procedures in which political power, instead of fairness and justice, will prevail. (Esharp)
What Mario Draghi must do next to Fix Europe’s Economy
In his column, Wolfgang Münchau approaches the current state of the European economy through the prisms of Keynesianism, fiscal theory, monetarist, and structuralist economic theories. While European policymakers mostly adopt structuralist views, the author claims that structural reforms are mostly irrelevant for the recovery of the European economy. Münchau, who personally favors quantitative easing programs and a restatement of inflation targets, thinks that an effective policy response is feasible but unlikely because it will be hard for Draghi to co-opt European policymakers into a coordinated response. (Financial Times)
Europe Is Coming Apart
Amidst the discussion about the upcoming Scottish referendum, Joe Weisenthal of the Business Insider alerts about the steady increase of anti-European sentiments exemplified by the growth of anti-European parties in Germany and France. Most prominently, a recent poll showed that the French ultra-right wing politician Marine Le Pen is the current favorite in the 2017 French presidential elections. The author hopes that the measures introduced last week by ECB President Mario Draghi will revive the Eurozone, but insists more must be done. (Business Insider)
Niedermeyer: EU must Seek Alternatives to Russia
Niedermeyer, a Czech MEP, addresses the current debate on the European Union’s economic sanctions on Russia, stating that regardless of their impact, the European Union should not consider Russia as a trade partner anymore, because it does not respect treaty rules nor state sovereignty. He strongly insists on looking into international trade agreements such as TTIP as alternatives to secure the European Union’s member states’ security and prosperity in the future. (Prague Post)
Upcoming Events
Seventh Round of TTIP Negotiations – September 29 – October 3 in Washington DC – a political stock-taking between Ambassador Froman and Commissioner De Gucht will follow the talks on October 13.
Resolving Cross-Border Internet Policy Conflicts – September 9 in Washington DC; hosted by the Information Technology and Innovation Foundation – More Information
Discover Global Markets: Free Trade Agreement Countries – September 9 -10 in Detroit, MI, hosted by the US Commercial Service – More Information
Jobs and Economic Growth for Atlanta: How TTIP Will Help – September 10 in Atlanta, GA; hosted by the Trans-Atlantic Business Council – More Information
TTIP Road Show, Edinburgh, Scotland: The US-EU Trade Negotiations and the Coalition for Transatlantic Business – September 23 in Edinburgh, Scotland; hosted by British American Business – More Information
Breakfast Briefing on the European Banking Union – September 23 in New York, NY; hosted by the European-American Chamber of Commerce – More Information
Jobs and Economic Growth for Indianapolis: How TTIP Will Help – September 26 in Indianapolis, IN; hosted by the Trans-Atlantic Business Council – More Information
TTIP: Does It Still Have Support in Europe? – September 29 in New York; hosted by the German American Chambers of Commerce – More Information
What’s Next? Fostering the Next Generation of Energy Security Conference – September 30 in Washington DC; hosted by the American Security Project – More Information
Transatlantic Trade & Investment Partnership – October 2 in Philadelphia, PA; hosted by the British American Business Council – More Information
Launch of new Atlantic Council Publication: TTIP – Big Benefits for Small Companies – October 9 in Washington – More information forthcoming