Representatives of the world’s two largest economies, the European Union (EU) and the United States, met December 16th for the third round of negotiations for the Transatlantic Trade and Investment Partnership (TTIP). Much is at stake with the transatlantic free trade agreement and its success will require rebuilding trust between the stakeholders as well as a high level of ambition and flexibility on both sides. Not everyone is enthusiastic about the TTIP.
According to economist and Nobel laureate in economic science, Joseph Stiglitz, TTIP could pose a real threat to basic democratic values and interests. This assessment is shared by close to one hundred popular movements and organizations, which have been refused additional information and reasonable influence in the negotiation process. The negotiations, however, are supposed to increase transparency, inclusiveness, and openness. Most importantly, the negotiations could become the means for rebuilding trust between the EU and the U.S. after the data surveillance revelations earlier this year.
In November, a leaked document from the European Commission suggested that the EU has developed a new communication strategy that focuses on communicating positively about TTIP and to refrain from reporting on what the TTIP is not about, which includes data privacy and lowering EU regulatory standards. The importance of the data privacy is a sensitive issue and is unlikely to go away. The Commission also stressed the importance of “one voice” and that the EU needs the free trade agreement more than the U.S. due to a weaker economic position.
As mentioned, the data protection issues will remain clear despite the fact that it has been cut out of the negotiations and it stresses the importance of conducting parallel negotiations on data protection, surveillance, and privacy. Without parallel data negotiations, the rivalry between the two trade blocs could spoil any deal. “Data protection is a fundamental right. It is different in nature to the tariff of a good or to the schedule of a service. That’s why a discussion on standards of data protection should be kept separate from the give and take of a trade negotiation,” said Viviane Reding, Vice-President of the European Commission, and EU Commissioner for Justice September 17.
However, Reding may have another reason for separating the data issues from the trade agreement. The European Parliament has been debating new data protection rules and the aim is to agree on legislation before spring next year. Failing to agree on new rules could delay their implementation and this could be further delayed with the Parliament elections in May next year. But as the third round concluded December 20, it is evident that the lack of transparency impedes the support for the trade agreement on both sides. There are substantial obstacles to overcome, even when excluding the data issue, and these include legislative concerns, regulatory standards, and market regulations.
But the main obstacle is trust and the rebuilding of such. While the damage is done, continuing with the negotiations seems to be assuring the EU that the U.S. wants the free trade agreement as much as the EU. Improving the relationship between the U.S. and the EU should be prioritized between the rounds, and this includes creating platforms where businesses and civil society organizations can engage in dialogues. Additionally, the progress made should be carefully evaluated when U.S. Trade Representative Michael Froman and EU Commissioner Karel de Gucht meet in January.
Rebuilding trust between the U.S. and the EU cannot simply be made at the political level; rather, there is a need to rebuild trust in the business sector, especially small and medium enterprises. The EU must make clear how the trade agreement would benefit the citizens of the 28 Member States, but the reporting should not exclude the sensitive issues since these will impede the support of the TTIP. The overall objective of TTIP is to increase trade and investment between the EU and the U.S. by enlarging the transatlantic marketplace and generating opportunities for job creation through greater regulatory compatibility, which can pave way for global standards.