Cornish pasties baked in the West Country, Stilton made in the Midlands and Cumberland sausages from… wait for it… Cumbria. Well, yes, of course – where else would they be made? But if certain international negotiations reach a particular conclusion, the answer could be: Anywhere.
At this point, you’re probably wondering what on earth we’re on about (and getting a tad peckish). Well, it’s because of this not-so-little trade deal called the Transatlantic Trade Investment Partnership (TTIP). It’s still under negotiation – has been since 2013 – and has somehow stayed under the radar. Which is surprising, considering the potential scale of the agreement’s impact.
In short, the TTIP is a bilateral trade agreement currently being negotiated between the EU and the US. Its main aim is to relax regulation and cut trade tariffs. In other words, reducing barriers to trade and opening up markets on both sides of the pond.
But is this a bad thing?
Well, it depends on how you look at it – and this deal has certainly polarised opinion. Those in favour claim that it will stabilise the relationship between the EU and the US. They also maintain that the TTIP, if ratified, would result in the regulatory convergence of two of the largest markets in the world, which could in turn lead to other markets from around the world adopting similar regulatory standards. And while this would, presumably, allow for greater ease of trading with the EU and US markets, it could also result in improved standards of labour and trading in these other markets. In addition, the UK government claims that the deal could boost the economy, pouring £10 billion into the UK economy and £100 billion into the EU. Each year. Figures like those add up to a pretty powerful argument.
But opponents say that it’s something we ought to be rather concerned about, for several reasons, including:
- Relaxation of banking regulations. Since the crash of 2008, there’s been more focus on tightening up banking regulation both here in the UK and in the US. In fact, US banking regulations are more stringent that UK ones. The TTIP could mean a relaxation of banking regulations, particularly in the US – giving the industry back some of the power it lost off the back of the 2008 crisis.
- Privatisation of public services. Critics of the deal are concerned that it would open up European public services such as health and education to private US companies.
- Lower standards of food and environmental safety. EU and US regulations regarding food and environmental safety would be brought more in line with each other. And since the US regulations are less rigorous than the EU ones (for example, very little GM food is allowed by the EU, whereas it’s been reported that the majority of processed food sold in US supermarkets contains GM ingredients), this could result in a relaxation of the EU regulations.
- Investor-State Dispute Settlements (ISDS). What this means is that if, for example, an EU member state government acts in a way that has the effect of reducing the profits of a US company, that company will be able to take legal action against that government. And similarly, an EU firm would be able to sue the US government. And it’s worth pointing out that where ISDS has been included in trade agreements in the past, we’ve seen a corporation suing a government.
So what does the TTIP have to do with Cornish pasties?
Quite a bit, in fact. If it goes ahead, the TTIP will free up trade between the EU and US. To facilitate this, according to the German agriculture minister Christian Schmidt, it’s likely that EU laws protecting regional foods (such as the Cornish pasty) will be relaxed or scrapped altogether. This would open up the way for (often cheaper) US versions of the European foods that currently enjoy protected status to be brought to EU markets. And this could pose a very real threat to the regional businesses currently making these foods
The European Commission doesn’t agree, and claims that these restrictions would remain. But many US businesses don’t want such restrictions, so their abolition can’t be ruled out just yet.
How likely is it to go ahead?
In short, we’re not sure. Perhaps after 2 years, you might think, negotiations would reach a conclusion soon. And there’s been mention of the EU Commission looking to sign the deal by spring 2016. However, EU Trade Commissioner Cecilia Malmström has said that the Commission would not agree to a deal that does not ‘protect public services and maintain consumer protection’. Make of that what you will: it doesn’t actually give much of a clue, does it?
So, as you’ve probably realised, nothing has yet been finalised. But rest assured, once it is, we’ll let you know (we’re just nice, like that). In the meantime, you might want to check out…
… and have a pasty or two.