The extent to which negotiations on the TransAtlantic Trade and Investment Partnership (TTIP) will pick up momentum following the Brexit referendum remains to be seen. It would appear that the EU’s negotiating position may have suffered a setback following Britain’s decision to leave the EU.
Another factor which may slow down matters is the impending US presidential election, since it is unclear whether Obama’s successor will continue to support the negotiations.
However, we are keen to know how our members in Malta may benefit from TTIP and the benefits it holds for Maltese entrepreneurs keen to expand their business in the US.
The aim of TTIP is to eliminate barriers to trade between the two blocs. Barriers may take the form of a tariff – but then tariffs between the US and the EU are already relatively low. The challenge lies in the elimination of non-tariff barriers, examples of which include quotas, foreign exchange controls and administrative and bureaucratic measures. These non-tariff barriers push costs up, and may even prove prohibitive at times, particularly to SMEs which would not have the resources and are therefore disproportionately affected by them.
The Maltese Chapter of the American Chamber of Commerce (AmCham) was set up 12 years ago and its members typically have business ties with the US, or are professionals who offer their services in the US.
The jury is still out regarding the ultimate benefits of TTIP on the EU economy and on Malta
During the past few years, AmCham has been closely following events in relation to TTIP and has watched the unfolding of negotiations since 2013 when President Obama and then EU Commission President Barroso jointly announced that the US and EU were giving the green light for negotiations to commence on creating a transatlantic business partnership between the two blocs.
As far as I am concerned, the jury is still out regarding the ultimate benefits of TTIP on the EU economy and on Malta. It would be extremely shortsighted if TTIP were to be reduced to a battle about food standards, without considering the benefits to consumers and the jobs that the partnership would create on both sides of the Atlantic.
What is the point, for example, of a car or a pharmaceutical product to have to satisfy two safety licensing standards (EU and US), when these are substantially the same? TTIP would signify the elimination of these double licensing requirements and would standardise products, bringing down costs with the reduction being passed on to the consumer.
The interim report on the benefit of TTIP commissioned by the EU was published in May this year and indicates that the economies of all member states will grow as a result of the implementation of the agreement, with the prediction that EU exports to the US would rise by 27 per cent
During the negotiating stage, it is important for entrepreneurs, particularly those already doing business with the US, to highlight those barriers which they may encounter in trading with the US. This is extremely important since barriers may be subtle and not that easy to detect in niche sectors.
This is where AmCham feels it can be relevant to its members. AmCham Malta has organised a number of events for its members on the subject, the last one in June, where a local ministry official gave a presentation to its members about TTIP and its potential effects on Maltese business.
AmCham wishes to reach out to new members and be the interface between Maltese businesses exporting to the US, and the Maltese government and EU institutions. Moreover, AmCham’s role is also that of being a first port of call to US businesses wishing to venture into Maltese business territory.
AmCham Malta is also a member of AmCham EU and is therefore able to represent its members indirectly in European fora.
The proposed partnership is a truly ambitious one and presents an opportunity for Maltese businesses, while Malta should also study the potential of becoming the entry point for US businesses wishing to enter the EU.
Tanya Sciberras Camilleri is the president of AmCham.