Transatlantic Trade and Investment Partnership (acronym TTIP) is a bilateral trade agreement between European Union and the United States of America. The aim of this agreement is to regulate and synchronize trade between the two states. It aims to reduce tariff barriers to zero and non-tariff barriers by 25%-50%.Negotiations regarding the agreement are taking place between the European Commission (on European Union’s behalf) and the Office of the United States Trade Representative (on United States’ behalf).
Approximately 60% of the world GDP is facilitated by the United States and European Union together. The two partners together make up 33% of the world trade in goods and 42% in services. The implementation of this agreement will lead to the formation of the largest free trade zone ever, accounting for 46% of the world GDP. Moreover, the European Commission has reported that both partners would gain tremendously from TTIP. The European Union’s economy is said to increase by 120 billion Euros and United States economy by 95 billion Euros.
TTIP will not only increase employment with respect to exports, but will also create a market with cheaper goods and services. Moreover, according to a study by the Centre for Economic Policy Research (2013), TTIP would raise the standard of living of families in Europe as a result of decline in price and increase in wages.
However, fears regards the agreement have been mounting. People feel that the agreement would lead to extensive privatisation in terms of the US providing UK with critical public services such as transport, health and education. Another primary fear is that this would lead to a significant decline in quality standards, for example while EU doesn’t permit cosmetics which have been tested on animals, the US does.
TTIP would also lead to the creation of ISDS, acronym for Investor-State Dispute Settlements. This will allow various corporations to sue governments in case of loss caused (supposedly) by policies implemented like them. The fear lies in the fact that, this would leave a lot of power in the hands of multinationals which could lead to them controlling the government. There is a lot of controversy surrounding the agreement however, one hopes for a good outcome.