Caspary: TTIP could provide ‘more productive market access’ to LDCs

Daniel Caspary [European Parliament]

When it comes to TTIP, safeguarding standards and pushing European or American interests are top of both camps’ agendas. But how would an eventual agreement affect developing countries and their access to the global market? EURACTIV Germany reports.

euractiv.de spoke to Daniel Caspary (CDU), an MEP with the EPP group and a member of both the European Parliament’s Committee on International Trade and its Delegation for relation with the countries of South Asia.

Caspary spoke with euractiv.de’s Editor-in-Chief, Ama Lorenz.

A recent study by the Ifo Institute for Economic Research showed the negative economic effects TTIP could have on developing countries. To what extent has this been considered in the current negotiations?

Both we at the European Parliament and the Commission believe that it is important that TTIP is a sustainable agreement in which development cooperation and aid to less developed countries must be considered.

According to the study, agreements like TTIP are not particularly well suited to this.

I’ve read these studies very attentively too. Do they say that TTIP could have a negative impact on developing countries? Yes. But they also show that there are countries and regions that could benefit from TTIP. So one cannot generalise and say that it will have a negative effect, when there are also advantages to be had.

Benefits such as…?

Take a country like Bangladesh as an example. At first glance, according to these studies, textile manufacturers could be hurt by the elimination of certain market benefits. If we were to abolish tariffs between the US and Europe, or at least significantly reduce them, then this advantage might disappear. But on the other side of things, textiles are one of those products whose demand would rise due to material growth in Europe and the US. Countries like that could reap the benefits again.

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When you talk about market benefits, are you talking about the EU’s “Everything but Arms” initiative for Least Developed Countries (LDCs)?

Yes, because the EU already provides many countries around the world with tariff and duty free access to the European market under this initiative. The issue of tariffs carries with it a certain amount of misunderstanding when it comes to public perception. As I said, third countries could be negatively affected by the Americans being granted access without or with fewer tariffs.

Yet this initiative doesn’t seem to be enough to counter the global impact of TTIP, also when it comes to standards.

Certainly “Everything but Arms” is not a universal remedy. But when it comes to standards, it’s the same discussion as the tariffs. Suppose we come to agreement on standards in a certain sector, for example, industrial products. Is this really a disadvantage for third countries or would regulatory cooperation between the US and Europe also be a benefit? Developing countries would not have to satisfy two different standards for two different markets. This could lead to more productive market access.

Not necessarily, when it comes to food standards.

Yes, I see a dilemma when it comes to this too. Our high standards often mean many operators in the poorest countries cannot access the European markets. Smallholders in those countries are hard-pressed to satisfy high standards in meat or healthy foodstuffs. What people say is right, we need to improve the living conditions of these producers in order to tackle the causes of the refugee crisis. However, the same people don’t want standards to be lowered. There’s an incompatibility here. Additionally, TTIP will potentially allow us to harmonise our standards in the long-term. That means that in 15 to 20 years, a transatlantic standard could be higher than the individual standards in place in Europe and America today.

Market access would be more difficult for developing countries then.

Honestly, we are still looking for a good solution, which consists of a combination of development cooperation, training and guidance on market access, as well as the EU’s general market strategy. Not all the goals we want to achieve can be easily and immediately implemented.

Is this a question of the cake being larger, but the pieces remaining the same size?

This is an issue that bothers us all – becoming more prosperous without someone else having to foot the bill. Some faults are the responsibility of Europeans; a remnant of colonial times, especially in Africa. But a large part of future responsibility lies with the governments of those countries that are interested in their country and its population developing.

It’s been shown that developing countries that have stable governance and an interest in global markets are also developing positively. The EU is going to help with this.

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How exactly?

We are currently negotiating, for example, bilateral economic partnerships with many African countries. Within the WTO, we are taking into account the interests of the poorest countries. Specifically with the implementation of the Bali Package, which is aimed at lowering global trade barriers.

Many different points of view, a lot of unanswered questions and growing resistance not only in Europe but also in the US… Without resorting to your crystal ball: do you believe that TTIP will actually be signed by 2017?

I want TTIP to be thoroughly negotiated. But thoroughly does not necessarily mean slowly or interminably.

TTIP for dummies

In the wake of the global economic crisis and the deadlocked Doha round of international trade talks, the EU and the United States started negotiating a Transatlantic Trade and Investment Partnership, which seeks to go beyond traditional trade deals and create a genuine transatlantic single market. But the road ahead is paved with hurdles.

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