The Trade in Services Agreement (TiSA) is not about opening up European markets, but about making others’ less closed for the sake of reciprocity, said MEP Viviane Reding, before the European Parliament is due to vote on a number of recommendations.
Luxembourgish MEP Viviane Reding (Christian Democrats) is the rapporteur in charge of drafting a set of recommendations on TiSA which the Parliament is scheduled to vote next week in Strasbourg. TiSA is a trade agreement currently being negotiated by 23 WTO members, including the EU, who want to further liberalise the trade in services between each other.
Reding spoke to EURACTIV’s Editor-in-Chief, Daniela Vincenti.
Next week, the Parliament is going to vote on a set of recommendations for the Trade in Services Agreement (TiSA) based on your report. Do you expect there will be a general consensus across the political board on telling the Commission what and what not to negotiate?
It will be very important to have a general consensus because if the parliamentarians – who are directly elected by the people and have to take into account what the people think and what they want – want to weigh in and use their influence, then they need to have a wide agreement because if they don’t, nobody will take them seriously. But if the major parties go for a strong statement, this will be the line to work on for the chief negotiator of the European Union.
The TiSA negotiations between 23 countries are about primarily about market access, especially in services. We are at the 16th round of negotiations, and we have advanced very rapidly without facing the same criticism that TTIP, for example, has encountered, or even ACTA. Do you reckon that the Commission’s work on transparency has calmed critics and already bringing results?
You cannot do things anymore behind closed doors in an ivory tower. Stakeholders want to know. You have to say where you want to go and what you are achieving, and you have to make this public. That is exactly what the Parliament has asked the Commission to do and the Commission has answered in a positive way.
The MEPs are fully informed and the results of the negotiations are published on the website of the Commission, for any stakeholders of interested citizens to look at. But most importantly, MEPs are communicating with the chief negotiator before and after each round of negotiations, they can exercise an influence on how these negotiations go, in the interest of our companies and our citizens. We do this in full transparency, we inform, and that is the way that all negotiations in trade should be handled.
Let’s get into the details of TiSA. Services comprise 25% of all world trade. What are the benefits of TiSA?
To eliminate the unfairness on the market today. Europe is a rather open market, and it is not complicated for a company from Asia, the Pacific, Africa, to come and compete on this market. But our companies are blocked by very high non-tariff barriers, so their services become very expensive and they cannot compete any more. This is not fair.
It is not fair that we are open and the others are closed. So TiSA is not about making Europe more open. It is about making the others less closed than they are now, and most of all allowing our export-oriented service SMEs to gain better access to those markets and to sell good products. We have good products already, but we want the freedom to sell them without being blocked by barriers that have been put up to make it impossible for our SMEs to compete on the foreign markets.
Could you give a more precise example, say, on the subject of free movement of professionals, which is something that could be controversial, especially at a time when the some EU member states push to reconsider freedom of movement?
You must understand that this agreement is not about the free movement of the carpenter. But it is about a company that sells a service, for instance building an electric plant and providing the services associated with it.
This company needs to be able to send its engineers to the third country to supervise the works. So for us, TiSA must allow for the movement of the highly qualified professionals, this is not about workers. It is about professional who for a limited time, can work in a given country because they are linked to a specific contract. That is the only thing that free movement means in the context of TiSA.
That’s very clear. TiSA negotiators, I suppose, should also look into ‘new services’ which in some countries have sparked concerns. I am thinking of Uber, Airbnb and other services in the sharing economy. Is TiSA tackling these new services so that they are allowed to thrive across borders?
TiSA will not change national laws, for instance on labour, or the guarantees that Europe puts on national laws. That will remain the same. It is up to member states to decide on how they want to cope, and how they should change their own rules in order to adapt to the sharing economy, which will continue to grow and to spread across other sectors. That is a reality that member states will have to cope with, and it is very much linked to our labour laws, which will not be touched by TiSA.
Some of the countries have not ratified all of the ILO conventions, so that could be a point of tension that could come to the fore in the European Union, especially when it has to be ratified. Do you expect that to be a controversial element of the deal?
We Europeans believe that the ILO conventions are the base. Most of our non-discriminatory national labour laws go over and above the ILO standards, but for the world, the ILO standards should really be the minimum that each country should adhere to. So in the TiSA agreement, we are exercising pressure to make others agree to adopt at least these minimum standards. We think that would be a good starting point for the people in the countries we are negotiating with.
Can TiSA be the deal that would set the rules for the rest of the world when it comes to services and market access to services?
Yes. Very clearly, yes. Because the countries that are negotiating the rules now – and with Europe negotiating with one voice for 28 countries – represent 70% of world trade in services. So if those 70% manage to create minimum rules for those 23 nations, or entities, the sheer scale of their influence will give the agreement an enormous impact and it will be difficult for others not to adopt the minimum rules.
These rules are also there to protect SMEs: our own of course, because they are the ones we care for, but also the SMEs of other countries. I believe there is enormous potential there for creating more jobs. If the import and export of services functions more smoothly, I believe it will be a very, very big step forward.
Next week, negotiators will meet for the 16th round. Do you expect we will reach an agreement soon, and how important is it to have it finalised before the end of the year before the US elections?
It is not only about the US. There are many other players joining the negotiation table in the course of this year.
I think it is a mistake to speak about dates because sometimes you can make very strong progress, but then one thing can cause infighting and enormous problems. I can say, realistically, looking at the pace of the negotiations and how far we have come, that there is a realistic chance that we will succeed.
There will be five or six impossible problems left until the end, and the infighting will be terrible on these few problems, but the bulk of the questions will already have been agreed. So it is possible that we will conclude a good TiSA agreement within a good time-span.
One more question. China is not in TiSA or TPP negotiations. They are the elephant in the room in many trade negotiations. Is that a mistake?
China is becoming more and more sophisticated. It has more and more good services to export. For exporting these services, it encounters very limited barriers on our markets.
We have even better services, but when we want to export them to China, we are charged non-tariff barriers of up to 60-70%, so we cannot compete.
This is completely unfair. In order to change that, I would prefer to have China sitting round the table, rather than sulking in the corner.