TTIP and CETA: “Our SMEs will not be the main beneficiaries of these future agreements”

In view of the United States’ intransigence, France now wants to call for a halt to the negotiations on TTIP (Transatlantic Trade and Investment Partnership, also known as the Transatlantic Free-Trade Agreement, or TAFTA).
France is however pushing for the rapid adoption of CETA (Comprehensive Economic and Trade Agreement), the trade deal between the European Union (EU) and Canada. According to the European Commission, our SMEs will be the main beneficiaries of these future agreements.
We beg to differ.

See also: “TAFTA: what the confidential documents on the transatlantic negotiations reveal

Studies predict that, at best, these deals will lead to very limited growth and job creation – while others claim there could even be a negative impact. Only 0.7% of French SMEs export to the United States. These agreements could make this trade easier; but what will be the impact on the remaining 99% of French SMEs? Why are the powers that be still refusing to carry out an in-depth study – by sector and by country – to answer this question?

Greater Access to Our Domestic Markets
Our enterprises already face tough competition from multinationals that chose to locate their operations here, thanks to the favourable fiscal, social and environmental conditions. TTIP and CETA seek to give these multinationals even greater access to our domestic markets – and to the public procurement market – without the guarantee of fairer rules.
How can SMEs be consulted when the negotiations are so shrouded in secrecy that the only source of information for citizens and entrepreneurs is leaked confidential documents? What we do know is that these deals go far beyond the realms of regular free-trade agreements, given that the customs duties between the two continents are already relatively low.

See also: “TAFTA: this treaty is dead – and may well have been from the very outset

As the goal is to harmonise regulations, this also means that norms governing food, social issues and the environment are at stake. The United States is calling, for example, for the free movement of personal data, even though there continue to be concerns about the level of protection guaranteed by the EU’s recently negotiated so-called “Privacy Shield” (the EU’s personal data protection policy).
In CETA – and indeed TTIP – there is no mention of the precautionary principle which notably forms the basis of the ban on certain chemicals in the agricultural and cosmetics sectors. For its part the EU has been highly critical of the United States’ increased financial regulation following the crisis; and it has also attacked the provisions favouring SMEs regarding the North American public procurement market.

Right of Review of Our Laws

The necessary simplification of rules must not be used to reduce the scope of the rules. The risk is that each sector ends up either having the laxest standards or merely recognises equivalences without proper harmonisation. This would expose local producers – who focus on quality and sustainability – to competition that could put them out of business. As far as Registered Designation of Origin (known as AOC) is concerned, the Canadians have only recognised a handful of them; and the United States will not even entertain the idea.
But there is something about all this that is even more worrying than merely the survival of our businesses: these agreements also represent a new threat to our democracies because they allow the most influential commercial players to set regulations – thereby undermining the social contract. The main stakeholders being consulted in this process are the multinationals.

See also: “The future Trade Commissioner works to allay concerns about the Transatlantic trade deal”.

The agreements currently being negotiated – and that are still on the table – are designed to institutionalise the right of multinationals to review our laws and to give them the right to take legal action – in an arbitration tribunal – against a state if a multinational believes it has been wronged or aggrieved by public policy. As it is only available to international investors, this onerous measure breaches the principle of the equality of enterprises before the law; it would also discourage any future adoption of rules regarding financial stability, cultural creativity or climate.

Worrying Asymmetry
When it comes to the digital economy – a key driver of transformation and growth of our entire economic system and of social and political change – there is a worrying asymmetry between the American negotiators, who seem determined to exert power, and the EU which is still in the process of defining its global digital strategy.
While we are in favour of encouraging trade, we are not prepared to compromise on the European model in exchange for uncertain promises of meagre growth. Our approach is not prompted by fear – but rather by ambition.
Priority must be given to the development of local economic systems – vital for the creation of jobs – by adopting the equivalent of America’s “Small Business Act”: the aim would be to ensure that SMEs are guaranteed a slice of the market in public procurement contracts. The ever more rapid disruption of our economies means we need to preserve our ability to develop alternative models and to redefine a trade policy which is fit to meet the challenges of the 21st Century.

Details of the authors and members of the collective who co-wrote this article:

Benoît Thieulin, entrepreneur and senior academic at Sciences Po, Paris
Fabienne Delahaye, General Manager of the MIF Expo trade fair
Jean-Hugues Chezlemas, Director of CES +
Luc Delahaie from Chantier Naval du Grand Val
Laurence Ruffin, CEO of Alma
Thomas Huriez, Founder of 1083
Anthony Gratacos, President of SAS Gratacos
Matthieu Urban, Co-founder of Myfood
Rémi Roux
, Co-founder of Ethiquable
Arlette Rohmer, Founder of Jardins de Gaïa
Mathieu Grosset, Managing Director of Juratri
Arnaud Lelache, CEO of Agence française informatique

For more information go to:

LE MONDE | 19.09.2016 at 16.47 • Updated: 19.09.2016 at 17.12 | By Collective of Entrepreneurs

Translation (from French): Sean Klein
Authors: a group of entrepreneurs (see above)