The Transatlantic Trade and Investment Partnership sounds like a very esoteric concept without wide appeal or understanding, but it is nonetheless important to the United Kingdom’s economic development. The partnership would create a free trade area covering the United States and European Union, almost half of the world’s gross domestic product. The negotiations between the US and the EU, will be long, at times controversial and detailed. I know one thing for certain, I would rather the UK be at the table negotiating the deal rather than away from it.
That is why I have no hesitation in saying that our country’s role is as an active participant in the EU to achieve the best deal for UK, its economy and its people. Any uncertainty on our position in Europe is not good for the country, business or jobs. For the UK, there can be no long-term economic plan which cannot ensure the country’s membership of the EU in two years time. A better plan would offer certainty to business by being adamant that our role is at the centre of Europe, not on its periphery.
The issue of the TTIP calls on us to look at the UK’s role in the world and the choice we face as a confident, out-going trading nation.
Are we to be pessimistic and pull up the drawbridge on the rest of the world; or are we to be optimistic and embrace the world with all of its faults and try and transform what we believe to be wrong? I believe the UK must play an engaged role in the world and use and promote the global institutions we belong to, including the EU. It is the best for our people to be outward looking and everyone loses if we believe we can stop the world because we want to get off.
So being an optimist, while facing the world with eyes wide open, I know we need to belong to the EU. As a consequence, we make the UK comparable with the US and its economy. We negotiate as equals.
In principle, if we agree with a free trade area for the EU, we should not be against, in principle, a free trade area which includes the EU and the US.
Let’s look in economic terms at what is at stake. Each day, goods and services of almost €2bn are traded bilaterally, contributing to the creation of jobs and growth in our economies. Aggregate investment stocks between the US and the EU is the equivalent of €2tn. Latest estimates show that a comprehensive and ambitious agreement between the EU and the US could bring overall annual gains of a 0.5 per cent increase in GDP for the EU and the 0.4 per cent for the US. This is equivalent to €86bn of added annual income for the EU and €65bn of added annual income for the US.
For the UK, there is $1tn worth of investment and $214bn each year in trade with the US. The investment supports one million jobs in each country. TTIP could add an additional £10bn to the economy annually.
For my own region, the north-east of England, £2.4 billion worth of exports goes to the US each year. The north-east Chamber of Commerce estimates 42 per cent of its members want to export to the US within the next 24 months.
So for Europe, the UK and the north-east of England not to seek an agreement on TTIP would be a major and historic missed opportunity.
Whether we like it or not, we live in a world which is growing smaller. Where decisions taken on the far side of the world can affect job creation in my constituency in the north-east of England. We need to take advantage of the opportunities offered to us which will be best secured by public and private sectors working together in the national good.
Recently, I hosted a conference on TTIP for local businesses at NETpark in my constituency. NETpark is a science and innovation park based on the research triangle park near Durham, North Carolina, established in 1959, it is home to 190 companies and 50,000 jobs. It is a model that works and one Durham county council and Durham university back home in the north-east of England is wanting to emulate with government support. NETpark may never reach the size of its US counterpart, but its ambition is the same – to be a centre of scientific excellence. Launched 10 years ago, it employs over 400 people, with 1000 in the supply chain and there is 23 companies on the site including two PLCs, one of which, KROMEK, is active in the US marketplace. All of this is a result of the public and private sectors working together building a small, but growing engine room of the global economy.
I want to see more of this. I want to see thousands employed at NETpark in the years to come. I believe NETpark, under a TTIP agreement, could flourish.
I mention all of this about NETpark for personal reasons too. Less than a mile to the north of NETpark lies the former colliery village of Fishburn, where my father worked down the pit for most of his working life. I know he would be amazed by the kind of high-tech, cutting-edge, sophisticated jobs requiring a diverse spectrum of talents now on offer to local people who make the grade. Once the choice, in his day, was either to go down the pit or work on the farm.
Facilities, such as NETpark, underpinned by public-private partnerships working across national boundaries in common cause for the economic well-being of all our people, nurture ambition and aspiration which is the bedrock of my politics.
And that brings me back to the main tenet of my remarks – it is all about attitude and optimism.
The high value, cutting-edge jobs we want to see will only come about if we are robust and confident in facing an ever-increasing competitive global economy. TTIP allows us the chance to raise standards and cut tariffs to encourage trade. Obviously, there will be hurdles to overcome, such as our attitude to Investor-State Dispute Settlements, and any agreement’s effect on public sector procurement and the National Health Service but there is still a long way to go.
What must be exciting for those on the progressive left is that, for the first time in history, we can see on the horizon the possibility of creating a global economic environment in which half the world’s GDP and globalisation itself can start to be regulated with reduced tariffs, but only with the highest standards in consumer protection, financial services and labour laws.
All of this will not be achieved over night and may be a long-term ambition, but we need to start somewhere and that somewhere is the here and now.
Phil Wilson MP is member of parliament for Sedgefield
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