(BERLIN, GERMANY) – With reduced import duties and less red tape, the planned free trade agreement between the European Union and the USA is intended to generate growth and jobs on both sides of the Atlantic.
In addition to the macroeconomic benefits for both sides, the agreement would also be "a commitment to a global world in which shared values and common economic activities can be better promoted," said Chancellor Angela Merkel in June this year in Berlin.
Economic and political benefits
It will not be easy to achieve a comprehensive free trade agreement. Quite apart from the economic opportunities an agreement of this sort would offer though, it would bring the USA and the EU closer at political level and cement the transatlantic friendship.
Officially the agreement is known as the Transatlantic Trade and Investment Partnership (TTIP).
At the G8 summit in Northern Ireland, European participants and President Barack Obama of the USA gave the official green light on 17 June for negotiations to begin on a free trade agreement between the European Union and the USA. The European Commission will be negotiating on behalf of the European Union and its 28 member states.
According to a study published by the IFO Institute, the more extensively foreign trade is liberalised, the greater the positive spin-off for growth and jobs of a Transatlantic Trade and Investment Partnership can be expected to be. In the wake of an agreement of this sort, bilateral trade between the European Union and the USA could rise by some 80 per cent in the long term, and real income in Germany could increase by 4.7 per cent.
An extensive ambitious reduction in non-tariff trade barriers, i.e. a variety of rules and regulations, could create up to 110,000 new jobs in Germany and a total of around 400,000 in the European Union. In the USA up to 100,000 new jobs could be created.
Still top priority
Referring to the alleged activities of the American intelligence service, the National Security Agency (NSA), the Chancellor and President Barack Obama reaffirmed their "strong interest" in the planned trade and investment partnership in a telephone conversation last week, reported government spokesman Steffen Seibert. Negotiations still enjoy "top priority".
"From the point of view of the European Union it is very satisfactory that today we can already discuss with the USA at expert level the issues of data protection, protection of privacy, and monitoring intelligence services, all of which are important to us," underscored Steffen Seibert, speaking in Berlin on Monday.