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Lessons for CETA for TTIP: Tariffs and Trade

Michelle Egan
American University
Michelle Egan
American University

Abstract

Mega-regional free trade agreements have increased in salience as a result of the deadlock in the WTO. As inking of deals with major economic partners, minimizing exclusions, and tackling non-tariff barriers, takes place in the context of important institutional changes to the trade policymaking setup in Europe post-Lisbon, there has been a tendency to treat individual trade negotiations separately. As the EU negotiates each successive trade deal with Canada, Korea, United States, and Japan, they are often treated in isolation in the policy and academic literature. Though there are plenty issues that have risen to the top of the agenda in these trade deals, whether it is ISDS in TTIP, public procurement in CETA, or automobiles in Korea, this paper focuses on an issue that many ignore in trade agreements – as they are considered low and insignificant –that of tariffs. When CETA comes into force, almost 94 percent of EU agricultural tariff lines will be duty-free, and seven years later, that number will rise to over 95 percent. Yet tariffs get little play in current trade debates. This paper will focus on comparing the tariff issue in the context of CETA and TTIP. Many tariffs are agricultural, some of them, cut across both the US and Canadian market, others are specific to their respective economies. What happened in the tariff area in CETA? Does CETA give us a framework or model for TTIP in this area? Can tariff liberalization on both sides lead to contestation over the lowering of tariffs?