Written answers

Tuesday, 8 July 2014

Department of Jobs, Enterprise and Innovation

Trade Agreements

Photo of Joe HigginsJoe Higgins (Dublin West, Socialist Party)
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353. To ask the Minister for Jobs, Enterprise and Innovation if he will report on the talks related to the Transatlantic Trade and Investment Partnership and the Trade in Services Agreement; if he will outline the Government's position; and if he will make a statement on the matter. [28241/14]

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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Since the EU Council’s Decision in June 2013, to start negotiations with the US on a Transatlantic Trade and Investment Partnership (TTIP), five negotiating rounds have taken place, the most recent taking place from 19-23 May in the US. This Round covered extensive technical discussion on a broad range of issues including regulatory issues, sanitary and phytosanitary measures, government procurement, intellectual property rights, electronic commerce and telecommunications, environment, labour, small and medium-sized enterprises, and energy and raw materials. Some discussion has already started on the text of an agreement in relation to helping SMEs, technical barriers to trade and on competition. The next round is due to take place during the week beginning 14 July, 2014.

Negotiations on TTIP can be summarised as covering three broad areas:

The first is market access, for goods, services, and public procurement. The first tariff offers, that is, the immediate or phased elimination of import tariffs on an extensive list of goods, were exchanged earlier this year, and I expect that, over the next few weeks there will be further work and negotiations to extend the range of tariff free trade that can take place once TTIP comes into effect. On services, I understand that the US tabled its first offer last week, and Member States will meet shortly to discuss what has been proposed by the U.S. The Commission expects that the EU’s first offer on services will be ready soon. Naturally there is an important level of confidentiality about the detail of both sides’ negotiating position, but I am hopeful that the greatest level of market access can be achieved for our services exporters and for those looking to penetrate the very large U.S. public procurement market.

The second area covered by the talks is “rules”, on trade facilitation (EU and US customs systems), state-owned enterprises (these should operate on commercial lines), on raw materials and energy (EU is looking for access to US oil/gas exports that are currently restricted), and on labour and the environment issues (no weakening of standards/protections). Coming to agreement on these will also serve to set the standards for other Free Trade Agreements with trading partners, reduce the complexity for small companies to comply with many standards and market regulations, and regulate markets in an open and transparent manner.

The third most difficult and complex, but most important aspect of the negotiations, is reducing regulatory burdens, which involve a multiplicity of sectoral regulations. In particular, areas of regulation such as financial services, environment, and health and public safety are important here. In these areas there are legitimate but in many cases unfounded concerns about a possible lowering of regulatory standards. In fact, both the EU and the US are equally committed to retaining the high standards that serve to protect consumers. The objective in TTIP is to address differences in standards between our two economies while at all times maintaining the high levels of health, safety, environmental and other protection that is reflected in EU legislation.

Progress in respect of regulation, through harmonisation, mutual recognition or convergence, is the most important area. Studies by the Commission show that changes here will yield the most net gains under the Agreement. The Commission’s impact assessment suggests that between two thirds and four fifths of the gains from a future agreement would come from cutting red tape and having more coordination between regulators. It is important to see this as a two part issue: the process of how regulation is enacted, and the sector specific solutions being negotiated. How regulations are made, needs to be more transparent, with regulators deepening relationships with each other in order to address emerging issues together, such as setting standards for new technologies. Regulators are also discussing how to reduce the cost of meeting existing standards without affecting the levels of protection afforded by them.

In addition, real progress on issues like car safety standards, ending double inspections at pharmaceutical and medical device plants, should, over time, reduce costs for business, regulators and consumers. It is important to note that while regulatory aspects are one of the main elements of the TTIP negotiations, there is nothing in the negotiations that should prevent or undermine the rights of both sides to regulate, and the level of regulatory protection on both sides, be it environment, food, consumer safety, will not be lessened.

As regards investment protection, the European Commission launched a public consultation last March on the investment protection provisions of a future Transatlantic Trade and Investment Partnership. All stakeholders have had the opportunity to respond to this consultation, so that specific interests and concerns on investor protection and settlement of related disputes could be well understood by the European Commission, and used to better define the EU’s approach to investor protection in the TTIP negotiations. The public consultation closed on 6 July, and I expect that the EU Commission will need a few weeks to fully analyse the contributions.

Further information on the negotiations, including background documents, are available on the European Commission’s TTIP website]

My Department recently engaged international expertise to examine the economic and other impacts TTIP and related potential opportunities. The focus of this study will be to identify key areas and sectors of the economy that will be impacted by the TTIP. This work will help to inform our input to the European Union’s negotiating position and to identify appropriate policy responses to be deployed to maximise the potential of this historic agreement and provide an assessment of the longer term implications for enterprise policy.

I hosted a Conference in Dublin Castle on the 20thJune to look at the opportunities for Ireland from the TTIP and to bring together at political and senior executive level, Oireachtas members, representatives of various economic interests (including farmers and trade unions), Government Departments, Agencies and Regulators, in order to explore opportunities that lie ahead for Ireland.

At this stage it is too early to draw definitive conclusions about the impact of TTIP on our economy. However, initial assessments suggest that Ireland will benefit to a greater extent than the EU. Preliminary estimates point to a possible increase of 1.1% in GDP compared with a .5% GDP increase for the EU as a whole. This could give rise to an increase of 8,000 jobs over the implementation period of the Partnership.

As the negotiations advance, I will continue to look for an agreement that is comprehensive and balanced and one that delivers real trade and economic potential for our economy. In this context I recognise the need to minimise the impact of trade liberalisation and market opening on sensitive areas of the economy and will continue to express our concerns that any agreement respects our broad trade, economic and social interests and especially those of the Agriculture sector.

As regards the Trade in Services Agreement, this is an ambitious multi-country set of negotiations for an agreement on trade in services between members of the World Trade Organisation that are some of the largest importers and exporters of services. There are currently 22 countries participating in the negotiations with the EU counting as one participant. These are Australia, Canada, Chile, Columbia, Costa Rica, Hong Kong, Iceland, Israel, Japan, Mexico, New Zealand, Norway, Pakistan, Panama, Paraguay, Peru, South Korea, Switzerland, Taiwan, Turkey and the USA.

Since the EU Council’s Decision in March, 2013 during the Irish Presidency that gave the formal green light for the EU to participate in these talks, eight rounds of negotiations have taken place, the eighth round having just concluded in the last week of June in Geneva.

Ireland fully supports the EU’s approach in these negotiations. The exports of services are very important to the Irish economy. Last year the value of Ireland’s exports of services reached a new record of almost €95 billion; and with services imports worth €89 billion; Ireland had a trade surplus of €6 billion; for trade in services in 2013. An ambitious outcome in the Trade in Services Agreement negotiations is therefore very important for our economy. While the negotiations are currently outside of the General Agreement for Trade in Services (GATS), it is intended that the Agreement will eventually come within the scope of the GATS, so that all WTO member countries can participate and benefit.

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