Today the European Parliament gave the go-ahead to negotiations for an ambitious comprehensive EU-US ‘transatlantic trade and investment partnership’ agreement – or T-TIP in the jargon. The EU and US combined account for over half the global economy, making this by far the biggest free-trade agreement in history. Existing protectionist restrictions in America as well as in Europe mean that the full potential of our economic relationship is not realised. While the abolition of remaining tariffs on goods will bring worthwhile gains, the greatest benefits will be in removal of non-tariff barriers to achieve a much more integrated transatlantic marketplace. Tearing down such barriers could boost joint economic output by tens if not hundreds of €billions annually.
This is therefore a unique opportunity to stimulate growth and jobs and contribute to the Liberal Democrats’ key objective of building a stronger economy in a fairer society. As Vice-Chair of the European Parliament’s US Delegation, I will be pushing for a speedy conclusion of negotiations so we can reap the benefits as soon as possible. There is currently enough momentum on both sides of the Atlantic to see this deal signed off within the next few years, and we must not let this great opportunity pass.
After the EU, the US is the biggest source of investment in the UK. American firms account for a quarter of overseas investment in Britain and support an estimated one million British jobs. One of the major attractions for US investors is our continued membership of the EU, which makes Britain an important gateway to the rest of the single market. It is worth remembering that more US companies set up their European headquarters in the UK than anywhere else in the EU. David Cameron in Washington last week acknowledged that it was only as part of the EU that the UK could get this prize of a transatlantic deal, pointedly disavowing those in his own party who say we can build important trade ties on our own. President Obama has repeatedly made clear that the US also values our role as a liberal-minded and influential EU member, but that our special relationship will no longer be special if the clamour for the exit from Tory Europhobes and UKIP is successful.
This week leading business figures, including Richard Branson, made a strong economic case for why Britain should remain an EU member. They pointed out that EU membership is worth up to £3500 to each household, and could be worth far more if we focus on achieving reforms and delivering a more competitive Europe. The TTIP alone would be worth as much as £10 billion to the UK economy, the equivalent of almost £400 per household. Liberal Democrats have already delivered a £600 tax cut to more than 20 million people. We now want to focus on creating jobs, getting the economy moving again and putting more money into people’s pockets, not on endless navel-gazing about our relationship with Europe.
* Sarah Ludford is London MEP and the Liberal Democrat European spokeswoman on justice & human rights. She is a leading member of the European Parliament's civil liberties, justice & home affairs committee.