Trade Negotiation Focus Turns to T-TIP
U.S. trade negotiators are now focusing more and more on the Transatlantic Trade and Investment Partnership (T-TIP), a proposed free trade agreement between the United States and the EU. T-TIP negotiations started in 2013 and maintained a relatively slow pace until last fall when negotiators completed the 12-country Trans-Pacific Partnership (TPP) now awaiting congressional ratification.
Last week, government representatives met in New York for their thirteenth round of T-TIP negotiations that included stakeholder comments. While both governments praised the progress to date and expressed optimism at possibly finalizing an agreement this year, significant differences remain with increased pressure to complete an agreement before the end of President Obama’s administration. In particular, the two sides seem to have significant gaps to bridge on key agricultural issues.
Due to fears that negotiators could strike a narrower agreement without resolving those agricultural issues, a bipartisan group of 26 senators is calling for agricultural issues to remain a priority. Their recent letter highlighted the need for broad-based tariff elimination, science-based approaches to animal and plant health issues and the improvements to the troublesome EU regulatory framework for approval of biotechnology products.
U.S. wheat exports currently face a complex “margin of preference” program that allows only high protein wheat and durum into the EU duty free, as long as world prices remain above a certain threshold. USW supports a comprehensive T-TIP agreement that eliminates all wheat duties, contains a fully enforceable sanitary and phytosanitary (SPS) chapter and provides for a predictable biotechnology approval process. USW established a full T-TIP priorities document as negotiations began three years ago.
As two large wheat producers and exporters, the United States and the EU are unlikely to see major trade shifts in wheat because of T-TIP. However, the agreement does have the potential to expand access for U.S. producers to the world’s largest agricultural importer and to establish key precedents for future trade agreements.
Agricultural issues are far from the only remaining sticking points. Significant differences remain in automobile market access, the creation of an investor-state dispute settlement (ISDS) mechanism and access to government procurement programs. According to the schedule, negotiators will take stock of progress in late May, with another formal round likely in July.
By Dalton Henry, USW Director of Policy