The idea of creating a trans-atlantic free trade area (TAFTA) between EU and the US was first raised in the 1990s with the launch of the New Transatlantic Agenda in 1995. While the New Transatlantic Agenda heralded an elaborate and comprehensive framework of cooperation between the EU and the US, the idea of TAFTA did not come to fruition.
In his State of the Union address in February this year (2013), President Obama announced that Washington would launch negotiation with the EU for a comprehensive Transatlantic Trade and Investment Partnership (TTIP) and make the latter the most advanced economic agreement in the world.
Following this announcement, there is a flurry of excitement in Europe and America. A quick survey by the Pew Research Centre showed general support from the public for a transatlantic trade pact. Many analysts see the TTIP as one of the ways out of the economic woes, hoping that further trade and investment liberalization between the two largest economies will stimulate economic growth and create more jobs. According to the European Commission, the immediate financial gains of TTIP would be 119 billion euros a year for the EU and 95 billion euros for the US.
Negotiating guidelines for talks with the US has been drawn up by the European Commission, and have been submitted to the Council for approval. Once the mandate is given by the EU leaders, talks may begin as soon as June this year.
For some analysts, the TTIP is not just about the economic gains. They also see a bigger strategic purpose of the TTIP in strengthening the US-EU axis vis-à-vis China and other key emerging powers and the significance it has for the future world order in cementing the normative powers of the west.
A panel discussion to take place in the Lee Kuan Yew School of Public Policy on 18 March 2013 would discuss if the launch of the TTIP is indeed driven by a fear of emergent Asia and also the impact TTIP will have on Asia.
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