CRPE Policy Brief 37, May 2015, Author: Cristian Ghinea. The current discussion concerning the Transatlantic Partnership Trade Agreement (TTIP) is today’s one of the most important, with a huge potential for EU’s economic recovery. It is also one of the most controversial debates due to the diverging interests on this topic. The report aims to contribute to the current debate, linking the most important topics regarding TTIP with Romania’s realities
At the same time, Romanian Center for European Policies (CRPE) launches the first impact analysis of TTIP on Romania’s economy. The authors Lucian Cernat and Csilla Lakatos used the methodology developed by the European Commission when evaluating the impact of TTIP on EU’s economy, tailoring the calculations for Romania’s case. Hence, CRPE is following the trend set up by European think tanks and national governments to analyse TTIP’s impact on national economies.
Apart from the economical impact (TTIP will add 0.5% to EU’s GDP and 0.25% to Romania’s GDP when fully implemented), we can also discuss about a strategic role for this agreement. It is preferable to construct common EU-US standards and the rest of the world to adapt to them, due to the economical weight of this common economic space.
The author considers that perhaps the most controversial part of this negotiation is the intention to include in the TTIP a mutual protection clause for investments and the investor-state dispute settlement (ISDS). The ISDS arbitration clause is a mechanism that allows states and investors to resort to arbitration. This mechanism is controversial because it raises the question of national sovereignty and the lack of trust in the justice system of the countries receiving the investment. However, Romania has a positive track record in its international disputes. In the ICSID Court, 10 cases against Romania have been registered, out of which the state won eight. On the other hand, we have evidence that more and more large companies that invested in Romania prefer to resort to Romanian courts although they could call ISDS.
The report concludes that ISDS is a useful tool to provide investors supplementary guarantees. It is true that abuses are possible, rather at a discourse level, when investors try to influence public debate by means of blackmail, threatening to appeal to an arbitration court. Therefore, the additional conditions established by the American administration in 2012, by the European Commission in the CETA text negotiated with Canada are welcome.
This Policy Brief is published in the framework of the project “Influent, alert and informed in EU negotiations – Expertise and consultation on European policies” financed by the EEA Grants 2009 – 2014, the NGO Fund in Romania; For official information about the EEA and Norway Grants visit www.eeagrants.org.
The contents of this report do not necessarily represent the official position of the EEA Grants 2009-2014. The entire responsibility for the accuracy and coherence of the information is held by the project promoter, Romanian Center for European Policies and by the author of the report.