US, EU Launch TTIP Negotiating Round, Focus on Rules of Origin, IP
U.S. negotiators continue to prioritize the elimination of tariffs on textiles and apparel and wide-ranging agricultural products in the Transatlantic Trade and Investment Partnership (TTIP) as the U.S. delegation convenes with European Union (EU) counterparts for the fourth round of TTIP negotiations currently underway in Brussels, the Office of the U.S. Trade Representative said in a March 11 release. But the summit will largely focus on rules of origin, intellectual property, labor, regulatory sectors and services, said USTR in a previous statement (here).
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The lack of consensus on tariff offers floated separately in recent weeks may have kept market access off the agenda for the current round, said Marjorie Chorlins, U.S. Chamber of Commerce vice president for Europe. “What we have right now is a dynamic where the Europeans feel they can’t go very far with their offer. The two sides are going to have to come back to typical market access issues at a later time,” said Chorlins. “There is no doubt it would have been easier to have further dialogue on market access this round, but at the same time its very early in talks. The Europeans feel they did the heavy lifting and didn’t get the same ambition from the U.S. side. The U.S. thought they presented an acceptable position, but after seeing what the EU presented, I wouldn’t be surprised if U.S. negotiators are considering a more aggressive offer.”
The EU elimination of tariffs on agricultural products would help build on record U.S. exports in the sector, which registered more than $145 billion in Fiscal Year 2013 (here). The U.S. is also looking to dismantle unwarranted sanitary and phytosanitary restrictions that constitute unfair technical barriers to trade, said USTR.
"Eliminating tariffs would provide a level playing field for our agricultural producers, including for our apple growers who pay more than 7 percent in duties when shipping to the EU, but whose EU competitors pay no duties on their shipments of apples to the United States,” said USTR. “U.S. olive oil producers would also benefit from tariff elimination, since U.S. olive oil is subject to $1,680 in duties per ton on shipments to the EU, but their EU competitors pay only $34 per ton on shipments to the United States. Eliminating tariffs and quotas will help U.S. farmers, ranchers, manufacturers, workers, and their families, while giving Europeans access to safe, high-quality American food and agricultural goods.”
The U.S. and EU are negotiating governance issues, such as financial services, regulatory functions, investor-state dispute settlement, investment, as part of TTIP (see 14031003). Despite market access disagreement, tariff policy is comparatively easy to address, said Cato trade analyst Simon Lester, adding that many tariff barriers may likely be removed. “It shouldn’t be too hard to eliminate and reduce lots of tariffs. That being said, there may be some sensitive areas, some areas where countries want to protect domestic production, where you won’t be able to eliminate tariffs,” said Lester. “With financial services and other policies, you’re creating essentially a legal document where you have to come up with the wording that satisfies a bunch of people. With tariffs, you can just change the tariff number to another number. So in that sense tariffs are low-hanging fruit compared to governance issues. But if the EU wants access to financial services, maybe it has to open up some of its sensitive agriculture sector for US products.” The U.S. is also hoping to lock down "fully reciprocal access to the EU market for U.S. textile and apparel products," complimented by strong customs cooperation, said USTR. -- Brian Dabbs