EU trade ministers on Thursday (18 April) set an end-of-June deadline to reach an accord on the mandate to start negotiating a transatlantic trade and investment partnership that is strongly backed by EU leaders and US President Barack Obama.
Diplomatic sources say the intention is the Group of Eight summit meeting in Northern Ireland in June can help set the stage.
“The Irish presidency has prioritised stability, growth and jobs. A new trade deal has the potential to provide a real boost to economic growth and job creation, without the need for increased expenditure by governments,” said Richard Bruton, Irish minister Jobs and Enterprise Minister. Ireland is currently holding the rotating presidency of the EU.
According to assessments made by the EU Commission and other European bodies, a comprehensive Trade and Investment Partnership could over time boost EU GDP by 0.5% annually and help create approximately 400,000 jobs in the EU.
The Transatlantic Trade and Investment Partnership (TTIP) will extend beyond the removal of tariffs, to include the opening of markets on investment, services and public procurement. In addition, it will focus on aligning rules and technical product standards which currently form the most important barrier to transatlantic trade.
Financial services included in the trade pact
Negotiators want to include financial services in the proposed free-trade agreement the British ambassador to the United States said in Washington on Thursday.
The accord would aim to smoothen regulatory differences that have stunted US-EU trade in areas such as agriculture, chemicals, pharmaceutical and automotive. The EU is already the largest US. trading partner.
"We are pretty keen, pretty clear, that as the owners of the two most significant international financial centres, on either side of the Atlantic … that we would both like to see financial services covered by these negotiations," said Peter Westmacott, British ambassador to the United States.
He was speaking during an event at the National Foreign Trade Council, a US-based business group.
EU financial services chief Michel Barnier has also come out in favour of the move, a spokeswoman said.
A Treasury Department official said, "The United States will seek to obtain improved market access for services on a comprehensive basis, including for financial services."
Finding common ground on regulatory and market access issues could encourage banks and insurers to expand across the Atlantic instead of moving to other parts of the world.
The agreement would likely address issues such as what percentage of people on the board of a foreign bank need to be US citizens, and what stake foreign banks can hold in US financial institutions, another UK diplomat said.
Thornier problems would have to be dealt with separately, the diplomat said, such as derivatives regulation and the challenge of "too big to fail" banks.