Benefits and Drawbacks of Transatlantic Trade and Investment Partnership (TTIP)

Running head: INTERNATIONAL TRADE AND FINANCE
International Trade and Finance
Name of the Student:
Name of the University:
Authors Note:

INTERNATIONAL TRADE AND FINANCE
1
Table of Contents
Introduction:...............................................................................................................................2
1. Identifying the benefits of the proposed TTIP, while indicating any drawbacks associated
with TTIP:..................................................................................................................................2
2. Indicating why there is no significant level of opposition to TTIP in comparison to North
American Free Trade Agreement with Canada and Mexico:.....................................................4
3. Indicating why Trans Pacific Partnership (TTP) met with significant political resistance in
the United States when it was announced in comparison to TTIP:............................................6
4. Indicating whether the decision of President Trump to withdraw from the negotiations of
TTIP was beneficial to the American citizens and for American Citizens:...............................8
Conclusion:..............................................................................................................................10
Reference and Bibliography:....................................................................................................11

INTERNATIONAL TRADE AND FINANCE
2
Introduction:
The Transatlantic Trade and Investment Partnership that was proposed by President
Barack Obama for committing of free trade deal with the European Union have been
evaluated in the assessment. The assessment directly evaluates the benefits and limitations of
the proposal that has been made by President Barack Obama regarding free trade deal. The
assessment also highlights the significance level of opposition that was conducted to North
American free trade agreement with Canada and Mexico, which was proposed in USA.
Moreover, the political resistance that was showed for the announcement of Trans Pacific
partnership has also been evaluated with TTIP.
1. Identifying the benefits of the proposed TTIP, while indicating any drawbacks
associated with TTIP:
Transatlantic Trade and Investment Partnership are beneficial for both the American
companies and EU companies that are involved in the agreement. United States and 28
countries that are the members of European Union are forming the world's largest and richest
trading partnership with the help of the Transatlantic Trade and Investment Partnership. The
overall agreement can be traced to be acceptance of key axiom of international trade theory,
which ensures that good things happen to countries that are involved in free trade agreement.
Both United States and European Union has struggled with low economic growth and
persistent high unemployment, which relatively increases the government deficits. The free
trade would eventually ensure high economic growth for both sides, which will eventually
help in reducing the unemployment without costing another time of government spending
(Akhtar, Jones and Johnson 2014). The benefits that will be generated from the Transatlantic
Trade and Investment Partnership are depicted as follows.
Elimination of excessive tariff:

INTERNATIONAL TRADE AND FINANCE
3
The trade agreement would eventually allow both European Union and American
companies to lose their overall income from trade, as excessive tariff that was imposed on
trade will be nullified from the deal. The trade would eventually help to maximize the trade
opportunities that will be conducted among American companies and European Union
companies after the commencement of the deal. The economic conditions and unemployment
conditions of both the participants were relatively declining for the period of time, where the
deal would eventually ensure high grade partnership that will generate income and reduce
government expenditure (Ustr.gov 2019). The elimination of excessive tariff would ensure
high growth in companies where there expenses will decline and revenue in tax form will
increase for the government. This would eventually boost the economic condition of both
America and European Union. Therefore, the elimination of tariff would boost the revenue
generation capability of companies operating in 28 EU countries and America.
Boosting economic growth:
The Transatlantic Trade and Investment Partnership deal Good relatively ensure high
economic growth for both European Union and America, as the GDP is anticipated to grow
by about 0.5% per annum after the commencement of the deal. Moreover, the deal would also
ensure additional 200 billion dollars a year in economic activity that could be conducted by
the participants in their home region, which would eventually fuel their future growth and
reduce government spending (Ec.europa.eu 2019). This boost in the economic and GDP
growth would eventually allow the government to improve their current fiscal deficit and
ensure high growth rate with low unemployment. Trade deal will create the world's biggest
free trade zone, which would allow United States and 28 countries in the European region to
increase their economic growth, while reducing the government spending.
However, there are specific drawbacks for the trade deal, which are depicted as
follows.