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THE TRANSATLANTIC TRADE AND INVESTMENT PARTNERSHIP AGREEMENT (TTIP): MAKING A GOOD DEAL FOR EUROPE
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Convergence and divergence through
2015-16
Once again, the negotiations are highlighting
political social, and economic barriers between
the transatlantic partners. The eighth round of
talks took place February 2-6 2015 in Brussels
under the leadership of EU Trade Commissioner
Cecilia Malmström and US Trade Representative
Michael Froman. However, lingering doubts
about the feasibility of the
€
315 billion Juncker
plan are generating skepticism in Europe (espe-
cially in Southern European countries and
France) regarding both the much-trumpeted
but fairly anemic European economic “recov-
ery” and the real benefits of a trade deal with
the US that may well imply high social costs.
Although negotiators have made progress
on points such as technical trade barriers, state-
owned enterprises, customs and trade facilita-
tion, and telecom services, they have yet to
overcome differences regarding issues Europe-
ans perceive as critical such as labor rights, con-
sumer safety regulations, and environmental
protection.
It is therefore no surprise that sensitive points
will be negotiated at the highest political level.
The first among them is the inclusion of an in-
vestor-state dispute settlement (ISDS) mecha-
nism, by which foreign investors may bring
cases against the countries in which they have
invested before an arbitration tribunal should
they feel their financial interests have been
harmed or discriminated against. The devil is in
the details when it comes to democracy, trans-
parency, environmental protection, labor rights,
and consumer protection. Given the close inte-
gration of US and EU financial markets, financial
sector regulation—especially that targeting cur-
rently unregulated derivatives and similar instru-
ments—is bound to be a make-or-break issue
from the European perspective. The present
opinion in Europe is that any deal failing to safe-
guard Europe’s financial resilience to future cri-
ses similar to the subprime crisis of 2008 would
not be worth signing. Apart from the give and
take of negotiations regarding the inclusion of
an ISDS instrument or the agriculture, audiovis-
ual, and financial sectors, there is also the eco-
nomic climate to consider. While the European
Parliament’s International Trade Committee
(INTA) is expected to present a resolution on
TTIP at the May 2015 plenary session, any seri-
ous deterioration of economic conditions in the
Eurozone could completely derail negotiations.
The European Parliament: leading from
behind?
Europe’s institutional framework could also slow
down the negotiations to the point that they
eventually derailed. Here, the high sensitivity of
sector lobbies in member states and European
citizens hit by the crisis to issues involving banks
and big corporations, should not be neglected.
The European Parliament – the only EU institu-
tion whose members are directly responsible to
European voters – will undoubtedly play a deci-
sive role in the process. No less will the national
parliaments, which would have the final voice in
the case of a comprehensive agreement that
would include the big investment issues.
Paradoxically, the European Parliament, a
frequently criticized and undervalued institu-
tion, will have the final word on the sensitive
issues yet to be resolved during the last lap of
the TTIP process. The good news is that progress
has been made on transparency. Under pressure
by European civil society organizations, in the
fall of 2014 INTA chairman Bernd Lange forced
the public release of the European Council’s