Transatlantic Trade and Investment Partnership — House of Commons, 2015-01-15
Topic: Foreign Trade
Matthew John David Hancock (Conservative, Centre-right): The conclusion that trade raises wages and prosperity is borne out not only in the theory but in the evidence. The evidence of my lifetime has been that enhancing trade increases prosperity. That has happened in the decades for which I have been on this earth in a greater way than in any other time in history. About £1.5 billion in goods and services is traded between the US and Europe every day and 13 million jobs are linked to that. This ambitious agreement has the target, which it could meet, of adding as much as £10 billion to the UK. What does that figure mean? It is almost meaningless to all but the very largest companies This is what it means. Let us picture a small business owner who, five years ago, might nearly have gone under through no fault of his own thanks, in part, to the economic circumstances. Like so many smaller business owners, he did not give up and recently things have got better. The recovery might have delivered for him here, but he might want to expand and take on more staff and he might find people in America who want to be customers. He wants to sell his product to more people, but if margins are tight the prohibitive extra cost of the trade barriers means that that simply is not an option. Now, let us picture a post-TTIP world in which those costs do not exist. We have not only increased the UK’s GDP but managed to ensure that someone can trade, creating an apprenticeship or a job to fulfil those orders, and in America somebody can get a product that they could not get before. That reciprocity—that "something for something"—explains why free and fair exchange makes us all better off So how do we make that a reality? First, we must significantly reduce cost differences in regulations by promoting greater compatibility while maintaining high standards of health and safety and environmental protection, especially for cars, pharmaceuticals, food—which was mentioned by Members in all parts of the House—and financial services. Secondly, while tariffs are low on many goods, we must tackle the high remaining tariffs on, for instance, food, clothing and other goods that impede exports and hurt consumers. Thirdly, we must push for better market access for service companies, which make up almost three quarters of the UK economy. Where possible, we will seek a guarantee that our service companies are treated in exactly the same way as US providers and do not face any additional regulatory requirements beyond those that US businesses face. Fourthly, we must have more open and transparent public procurement opportunities. Why, for instance, should US rules require that only US steel is used in certain projects? Fifthly, we will target trade facilitation, removing some of the red tape and bureaucracy at borders, and cut unnecessary costs while speeding up the movement of goods This is a historic deal. I want to tackle some of the challenges and objections head on. Several Members raised concerns about regulation. In fact, TTIP provides an opportunity to take stock of existing rules on both sides of the Atlantic and to remove unnecessary duplication while ultimately making sure that we support a well-regulated market. This will be done without lowering environmental, labour or consumer safety standards. Nor will the inclusion of the ISDS provisions affect the ability of Governments to regulate. As many Members mentioned—my hon. Friend the Member for North Dorset (Mr Walter) brought it up first—we already have 90 such agreements in place and there has never been a successful claim brought against the UK Others expressed concern about the impact on jobs, yet time and experience show that trade creates jobs and supports higher wages. This is backed up by independent assessment. The overall impact on labour markets will be positive in the EU and the US, as real wages, whether of unskilled or skilled workers, will be able to increase.