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2/23/16

The EU and TTIP: Secret document reveals EU offer to drop 97 percent of tariffs - Justus von Daniels and Marta Orosz

We now know that the TTIP negotiations entered a decisive phase on October 15, 2015. That’s when US and EU representatives laid their cards on the table, exchanging offers to cut taxes on imports from each other. Up until then, the US had only broached hypothetical reductions; now they were openly offering to remove 87.5 percent of tariffs completely.

That was more than the EU expected. European negotiators had to agree a better offer, or risk derailing the deal. A week later, they did came up with a new proposal: reductions in 97 percent of tariff categories.

The EU’s secret offer, which CORRECTIV has seen in its entirety, is made up of 181 pages of densely-printed text and can be found here. It’s got almost 8,000 categories: Every species of fish, every chemical has its own tariff category. Importing a parka? Wool, or polyester?

Trade deals are like poker games. Europe’s big offer comes with a big hope: That the US will open up its public bidding process to European firms. That way, European construction companies could bid on contracts to build US highways, or BMW could sell cop cars to American sheriffs.

For the first time, the tariff offer makes clear what TTIP might do for consumers: remove duties, and prices tend to drop. With tariffs on parts gone, cars could get cheaper. Per part, tariffs add just a few cents on the euro, but altogether European car manufacturers could save a billion Euros each year, according to German Association of the Automotive Industry calculations. Manufacturers could then pass the savings on to consumers.

The EU is now waiting for the US to offer a substantial deal on public procurement. In a September 15 report obtained by CORRECTIV, the European Commission says “it definitely expects that the US will offer to open public procurement at a future point in time, in exchange for the revised tariff offer.”

That report also indicated that the US “promised to make a proposal regarding public procurement for the first time” when the EU and US put forth their symmetrical tariff reductions, eliminating 97 percent of all tariffs.
Public bids are a major TTIP sticking point. The EU wants the US to finally open its markets to allow firms like Balfour Beattie or BMW to compete when cities put out a call for bids on a new building or fleet of cars. The US is less than eager, because that would subject domestic companies – which are already allowed to bid on projects in the EU – to increased competition.

Four days before the next negotiation round starts, the European Commission has now indicated that they don’t expect a comprehensive offer. Sources said that the US haven’t sent their proposal yet and that public procurement will be discussed right after the official negotiation round. The 12th round of negotiations started this Monday in Brussels.

Read more: TTIP: Secret document reveals EU offer to drop 97 percent of tariffs | openDemocracy

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