Representatives of the US TTIP negotiating team are traveling to Brussels this week to set the ground work for their upcoming negotiations in the next official Round, in early February. The “Fresh Start” that Commissioner Malmström and Ambassador Froman have promised is about to begin in earnest.
Following the release of dozens of EU negotiating proposals and the initial analysis of the Commission’s public consultation on investment protection, the next few weeks will be pivotal for the future of the agreement, as well as the political commitment on both sides of the Atlantic to make significant progress on the deal in 2015.
Speeches & Official Announcements
House Ways and Means Committee Chairman Paul Ryan’s Opening Statement
“96% of the world’s consumers – they don’t live here. They live in other countries. […] I believe Americans can compete with any country; we just need to give them a chance. Break down these barriers, and American trade – along with American jobs – will take off.” – Chairman Paul Ryan
Taking the gavel at the first hearing of the Ways and Means Committee in 2015, new Committee Chairman Paul Ryan said Tuesday that his top priority this year would be to pass Trade Promotion Authority and seek approval of trade deals. TPA is the first item on the agenda, and it would give Congress the power to set negotiation objectives for trade agreements, get the best deal from global partners and hold the Obama administration accountable on trade. Chairman Ryan underlined TPP and TTIP as historic opportunities, each with the potential to create jobs and significantly boost economic growth. (Committee on Ways and Means)
News
The State of American Business 2015
US Chamber of Commerce President and CEO Thomas J. Donohue stated that while the state of American business is improving despite a variety of economic challenges facing the US, in his annual State of American Business address yesterday morning. After reiterating the chamber’s support for TPP and TTIP, Donohue noted that a top legislative priority was to help secure passage of TPA. (US Chamber of Commerce; click here for webcast)
TTIP: MEP Hails Proposal to Repeal US Jones Act
Liberal MEP Marietje Schaake applauded a proposal by US Senator John McCain to repeal the Jones Act. This 1920 federal law requires every ship transporting goods and persons between US ports to be made in the US, sail under a US flag, and be US-owned and crewed at least 75% by US citizens. While US Trade Representative Michael Froman has made it clear that he intends preserve the Jones Act, the discussion was brought forward in Congress after some US refiners suggested that a temporary waiver to the Jones Act would be needed for them to support a change in US export policy. Promoting fair competition in shipping is a key negotiating objective for the EU in TTIP. (EurActiv)
Europe’s Trade Chief Calls for More Study on Proposed Pact with US
Cecilia Malmström stated on Tuesday that the EU should continue studying the need for ISDS in TTIP, but stopped short of endorsing or rejecting the measure. Malmström highlighted the main issues raised by the results of the review of public comments and noted where areas could be reformed. Malmström also stated that she was still not ready to recommend how to modify the guarantee or say whether it should be jettisoned. (New York Times)
US Senator says Pacific Trade Deal on “Two-Month Trajectory”
Top US trade official Michael Froman told lawmakers a major trade pact with Pacific Rim trading partners is on a “two-month trajectory.” Negotiators hope to wind up talks this year on TPP but no deadline has been given. USTR continues to emphasize that the substance of negotiations will drive the timeline for completion. (Reuters)
Public Backlash Threatens EU Trade Deal with US
Backlash from the European Commission’s public consultation make it increasingly unlikely that TTIP will be concluded this year, according to the Financial Times. Several European parliamentarians stated their disapproval for ISDS, but EU trade officials say that European businesses want to ensure ISDS remains in TTIP so that it is maintained as a standard feature for inclusion in any future agreement with third countries like China. (Financial Times)
Trade Benefits America Coalition Urges Passage of Bipartisan Trade Promotion Authority (TPA)
An incredibly broad coalition of associations and businesses making up the Trade Benefits America Coalition wrote to President Obama and Congress to underscore the importance of quickly passing TPA, especially given ongoing efforts to close TPP and TTIP negotiations. They urge Congress to pass bipartisan TPA legislation in order to strengthen US negotiators hands to secure solid results in trade negotiations, demonstrate to other countries that Congress supports high-standard and market-opening outcomes, and help facilitate Congressional review and consideration of these agreements. (Trade Benefits America Coalition)
EU Agriculture Commissioner: Products with Genetic Engineering Must Be Clearly Labeled
The EU Commissioner for Agriculture, Phil Hogan, reaffirmed the EU Commission’s stance that products, which contain genetic engineering, must be labeled accordingly. Moreover, the Commissioner qualified earlier remarks from the German Minster for Agriculture. Hogan stated that TTIP will not undermine geographical indicators such as “Nürnberger Rostbratwürstchen” (Nuremberg sausages), instead it offers the EU the opportunity to extend these local-content protections across the Atlantic. (Sue ddeutsche) – Original article in German
Recent Analysis
TTIP: Brussels Maintains Course on Arbitration Courts
The European Commission has identified four areas needing work after the consultation results were published last Tuesday. These include: the protection of State’s right to regulate, the supervision of arbitrage tribunals, the relationship between ISDS tribunals and domestic legal recourse, as well as setting up an appeals process. The Commission reaffirmed its commitment to an open and inclusive process to decide with member-states, NGOs, and the business community on the best path forward on ISDS. (Les Echos) – Original article in French.
World Bank Lowers Expectations for Global Growth in 2015
Citing stagnation in Europe and Japan as well as a slowdown in China, the World Bank downgraded its forecast for the global economy this year. They predict that the world economy will expand 3%, up from 2.6% in 2014, but down from predictions last June of 3.4% for this year and 2.8% in 2014. However, plunging oil prices and stronger growth in the US are expected to help raise global growth in 2015. Moreover, growth among the 19 Eurozone countries is expected to pick up modestly to 1.1% in 2015 from 0.8% last year. (New York Times)
How To Stop Currency Manipulation
In his recent op-ed, Jared Bernstein argues that a chapter on currency manipulation should be added to TPP. With America’s trade deficit averaging $200 billion to $500 billion per year, partially as a result of currency manipulation, Bernstein believes that a more direct approach to confronting currency manipulation is needed – establishing a clear set of rules under the TPP umbrella. (New York Times)
Is a Major Trade Deal the Way for Obama to Secure His Legacy?
Mark Kennedy of American University argues that trade is one of the most likely areas where the president and congressional Republicans can work together. The Obama administration has passed three bilateral trade agreements that were negotiated by the administration of President Bush. Completing TPA, TPP, TTIP and the Doha round would give Obama major trade accomplishments he could truly own, unless he wants to stand out as the only Democratic president in modern times not to break down trade barriers. Therefore, the upcoming State of the Union is an opportunity President Obama cannot afford to miss when making the case for trade. (Foreign Policy)
Listen, Don’t Give In!
Despite widespread public skepticism against ISDS, Nikolaus Piper argues that the EU Commission should keep ISDS as part of TTIP. Eliminating ISDS would create a serious credibility problem for the EU, which would continue to have investor protection provisions with many undemocratic countries, but would be unable to agree to implement one with the United States, its most important ally. Piper urges the EU Commission to take the public concerns against TTIP seriously. Nevertheless, he cites examples of investor protection mechanisms from other trade agreements, such as NAFTA, to point out that these mechanisms have never endangered governments’ democratically guaranteed scope of regulatory action. (Sueddeutsche) – Original article in German
Upcoming Events
The Eurozone: Now What? A Conversation with Lucrezia Reichlin – January 16 in Washington, DC; hosted by The Brookings Institution – More Information
The Transatlantic Bond in an Age of Complexity with Federica Mogherini– January 20 in Washington, DC; hosted by the Brookings Institution – More Information
TTIP Town Hall: The Transatlantic Trade and Investment Partnership – Opportunities for Alabama – January 21 in Birmingham, AL; hosted by the Bertelsmann Foundation – More Information
EU-US: From Disappointment to Hope with Gianni Pittella – January 30 in Washington DC; hosted by the Center for Transatlantic Relations – More Information
The 2nd Annual EU-US Trade Conference: TTIP Where Now for the EU-US Trade Deal? – February 5 in Brussels; hosted by Forum Europe – More Information
Beyond Tariffs: Trade Relations and the Transatlantic Relationship in the 21st Century – February 6 in Washington, DC; hosted by Georgetown University’s School of Foreign Service – More Information
February 2-6, 2015 – Eighth Round of TTIP Negotiations in Brussels – More information to follow