The President announced his intentions to begin negotiations on a Transatlantic Trade and Investment Partnership with the European Union (EU) during this State of the Union address. What exactly does this mean for the U.S. economy and for U.S. agriculture?
The U.S.-EU economic relationship is already the world’s largest, accounting for one third of total goods and services trade and nearly half of global economic output.
Changes for the agricultural industry would relate to biotechnology approval and acceptance. A successfully negotiated partnership would have the EU defining their priorities and sticking to them so the U.S. would know how to work within the EU’s guidelines with the confidence that their requests would not change.
The elimination of tariffs and sanitary and phytosanitary measures would provide significant benefits for agriculture. Exports for all U.S. agricultural products have remained relatively constant at around $11 billion from 2007-2011. Coarse grain exports have ranged from $2 million to $570 million over that same time period. U.S. corn exports have varied widely from 6,000 to 972,000 metric tons over a similar time period. GMO approval and labeling restrictions largely impact exports of corn and co-products to the EU. Asynchronous approval process and effective zero-tolerance low level presence policy for unapproved events often prevent U.S. corn, corn gluten feed, and DDGS imports to the EU.
The partnership has impacts for the economy as well. In particular, the partnership would aim to:
· Further open markets to grow the $459 billion in U.S. goods and services exports to the EU, our largest export market, which already supports an estimated 2.4 million well-paying American jobs.
· Strengthen rules-based investment to grow the world’s largest investment relationship. The United States and the EU already maintain a total of nearly $4 trillion in investment in each other’s economies, supporting nearly 7 million jobs.
· Tackle costly “behind the border” non-tariff barriers that impede the flow of goods and services trade.
· Seek to significantly cut the cost of differences in regulation and standards by promoting greater compatibility, transparency, and cooperation.
· Enhance cooperation on the development of rules and principles on issues of global concern, including on market-based disciplines for State-Owned Enterprises, combating discriminatory localization barriers to trade, and promoting the global competitiveness of small- and medium-sized enterprises.
Read more about this important negotiation affecting the sale of your product here.