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The Strategic Imperative of TTIP (by Ambassador Jiří Šedivý)

BRUSSELS – As negotiations between the European Union and the United States over the Transatlantic Trade and Investment Partnership (TTIP) move toward a final agreement, opponents of the proposed pact are becoming more vocal. Criticism of any major economic-policy change is only natural, but failing to reach agreement on this accord would be a historic mistake – one that Europe will soon regret. Indeed, the TTIP could turn out to be the most important bulwark of transatlantic unity since the North Atlantic Treaty established NATO in 1949.

In considering the significance of the proposed treaty, it is important to remember that European integration began with the creation of a common market for coal and steel. The founding fathers of what is now the EU were well aware of the long-term strategic potential of what many at the time regarded as an inconsequential technocratic measure. Integration of commodity markets gradually spilled over to trade liberalization, the creation of a common market, and, finally, to the establishment of joint political institutions.


Today, North America and Europe account for close to a half of the world’s total output. The establishment of a free-trade zone between the two blocs is expected to generate an additional €100 billion ($107 billion) a year on each side of the Atlantic, as well as create millions of new jobs.

But the economic benefits are just one part of the picture. Just as free trade and open markets stimulated political cooperation in Europe, TTIP has the potential to contribute to strategic unity across the Atlantic – an objective that is as important now as it has ever been.

The treaty’s opponents have been trying to scare the European public with dire scenarios of what will happen if the TTIP is enacted. Standards for food safety will be gutted, they say. Employment protections and social rights will be swept aside. Public services and environmental regulations will be undermined. Cultural assets will be left unprotected.

Not all worries about the treaty’s impact are unfounded. There are legitimate concerns about the competitiveness of Europe’s agricultural sector, for example, and about the technical challenges of harmonizing a long list of norms and standards. Yet the problems that do exist are solvable, provided sufficient political will on both sides of the Atlantic.

It is no coincidence that the motley alliance of ultranationalists, populists, and protectionists opposing the treaty broadly overlap with those who are now siding with Russian President Vladimir Putin’s military adventurism in Ukraine. Their shared concern is the further integration and strengthening of the West. They know that the TTIP’s potential to boost innovation and economic growth, if realized, would increase its member countries’ geopolitical weight and power.

At the same time, TTIP could prove to be immensely beneficial to NATO, providing new meaning to the Alliance’s raison d’être of uniting countries with shared values to cooperate in their mutual defense. Given the sensitive nature of military procurement, both sides have – at least for the time being – agreed to exclude the defense sector from the negotiations. But the EU’s member states would be missing an opportunity if they did not pledge to use a part of the profits from the agreement to increase their defense budgets, thus mitigating the steep imbalance in military contributions and capabilities that currently exists between Europe and the US.

Understandably, the West’s main strategic competitors – China and Russia – are watching the emergence of a potential global game changer with growing concern. TTIP would impede efforts to divide its member countries or disrupt the institutions, rules, and norms of the liberal international order. Indeed, successful implementation of the treaty would help debunk the facile argument made by the Kremlin and its acolytes that the liberal order has become dysfunctional. Perhaps most important, Europe would face less of an imperative to look eastward in search of opportunities for economic growth, and could become less dependent on Russian energy supplies, particularly as the US loosens its ban on exporting its oil and gas resources.

TTIP’s strategic potential can hardly be overstated. It is crucial that technical objections, tactical considerations, or protectionist instincts not be allowed to eclipse the project’s geopolitical importance. Failure to realize the possibilities created by the treaty would be a terrible economic mistake. It would also represent a major setback for transatlantic relations at a time when the West can least afford it.

by Ambassador Jiří ŠEDIVÝ, published at "Project Syndicate", May 14, 2015; http://www.project-syndicate.org/commentary/ttip-global-importance-by-jiri-sedivy-2015-05#YckYvAxuH9VGZu0U.99