TPP: A challenge to Europe

What if the Trans-Pacific Partnership (TPP) is not a doomed initiative – and what if it will actually make inroads into modern trade problems? TPP will inevitably change the competitive relation between European and American firms to the world’s fastest growing consumer market. There is no reason to doubt that TPP is the new agenda-setting pillar in the Asia-Pacific region and beyond representing 60% of world trade – the same level as GATT during the 1980s. Our new policy brief explains how TPP will be the first ‘competing’ economic integration that is large enough to have a considerable negative impact on Europe, affecting also investment, productivity and competitiveness in the longterm. It also presents a 'deadly threat to European exporters of agricultural products in TPP countries’. While Europe negotiates bilaterally with some TPP countries, it has no  strategy equivalent to the TPP. The ongoing bilateral negotiations with Canada, Japan, Malaysia and Vietnam have been facing difficulties due to the priority given to TPP; it even adds pressure on existing FTAs with Mexico and Chile, whereas Australia and New Zealand are not being addressed at all.

In focus

ISDS - a priority in the EU trade policy?

Should the EU drop its ambition to have ISDS in TTIP - and perhaps in other trade agreements too? Investor protection has become a hut-button issue in EU trade politics, but few in the debate come with facts-based arguments. In a recent ECIPE publication experts have surveyed the recent decade of ISDS activity and found that the cases has continued to grow, and that the growth is concentrated to certain sectors with a high degree of government involvement or political patronage. Martina Ferracane and Fredrik Erixon have also commented on the role of ISDS in contemporary EU trade agreements with the focus on the Transatlantic Trade and Investment Agreement. In a previous work ECIPE has also analyzed ‘Repsol case’ in Argentina and its impact on investment protection issues. 

EU-China settle telecom equipment dispute

The European Commission and Chinese Ministry of Commerce announced on October 20 - separately - that a settlement had been reached that ends the EU CVD case against Chinese telecom equipment. Europe’s first ex officio investigation on Chinese subsidies quickly evolved into a matter of national prestige, internal divide and a two-year long episode of trade war. ECIPE scholars have commented on the case in various publications and in the media.

Next-generation trade defence: government-sponsored patent funds?

While there is an increasing interest for FTA disciplines that restricts state-owned enterprises, there is less debate on governments using intellectual property to engage in discriminatory industrial policy against foreign competition. A new report by Patrick Messerlin and Hosuk Lee-Makiyama points to how some SPFs, like France Brevets, even admit to being retaliatory or discriminatory instruments against foreign actors regardless of whether the original claim is legitimate or not. Such use of patents threatens to become a new trade defence instrument.

Investing in Obesity Treatment would Reduce Healthcare Spending

The obesity rate is growing fast – in Europe and around the world – and no government has effective policies for preventing obesity to increase healthcare expenditures. Yet while governments have been slow to react, medical scientists have now a good view of “what works” and “what doesn’t work” in policies to reduce obesity. A new study by ECIPE economists estimates that European countries stand to make huge savings in future healthcare expenditures if they use effective lifestyle weight management programmes to treat obesity today. If governments invest in smart obesity treatment, the UK and Spain could reduce healthcare expenditures related to obesity in 2030 by 10 and 12 percent. Germany could save around 6 percent while Sweden could “save” as much as 55 percent of future healthcare expenditures related to obesity.

How Can Europe Respond to an Authoritarian Russia?

Russia’s invasion of Crimea has sent shock waves through the international community but is not surprising in light of the Kremlin’s authoritarian and imperialistic ideology. As was shown in two papers by Fredrik Erixon and Iana Dreyer, Russia has been building military and economic statecraft on the back of its energy riches – and the EU has been far too weak to diminish its economic dependency on Russia. Broad economic sanctions by the EU is therefore highly unlikely, even if Russia’s investment in and export to Europe is so big that sanctions could put Russia Inc out of business. As Hosuk Lee-Makiyama has argued, economic sanctions usually do not work. And what it is important now for the EU, in addition to shaping a response to the Crimean occupation, is to reshape its approach to Russia with the effect of cutting its dependency on an authoritarian regime.

Latest Publications

ECIPE Bulletin No. 14/2014
Familiar fault lines: the myth of EP independence in economic policy-making
By Hosuk Lee-Makiyama, Bert Verschelde
Summary | Download (PDF)

ECIPE Bulletin No. 13/2014
“Rethink and Reset”: Time to get rid of the Stability and Growth Pact?
By Matthias Bauer
Summary | Download (PDF)

ECIPE Policy Brief No. 09/2014
By Fredrik Erixon, Hosuk Lee-Makiyama, Matthias Bauer, Martina Francesca Ferracane
Summary | Download (PDF)

ECIPE Bulletin No. 12/2014
The ECB’s Ad hoc Monetary Policy: Will its Lack of Forward Guidance Finally Burst the Eurozone?
By Matthias Bauer
Summary | Download (PDF)

ECIPE Working Paper No. 02/2014
A FRIENDLY FIRE ON ECONOMIC RECOVERY: A Methodology to Estimate the Costs of Data Regulations
By Erik van der Marel, Hosuk Lee-Makiyama, Matthias Bauer
Summary | Download (PDF)

Articles, Opinion and Commentary

Escaping Innovation Inertia
Fredrik Erixon opines in CapX about innovation and technological progress

Will TTIP fall victim to (social) online media campaigns?
Matthias Bauer writes on anti-TTIP groups overstated fears spread in the online media on E!Sharp.

U.S. Rebalancing and the Looming Liquidity Crisis
Miriam Campanella opines in Caixin about the US dollar and the Yuan

Keynes at Home, Smith Online
Op-ed by Hosuk Lee-Makiyama in Roll Call on Title II and net neutrality

A Survey of U.S. Citizen Attitudes Nationwide
Presentation by Chris Israel at the ECIPE conference The Politics of TTIP - What are the Key Controversies, How to Address them?, Brussels November 19, 2014

More articles