Brussels, 01/09/2015 (Agence Europe) - Rather in favour of the Democrat party's ideas, the Washington-based think tank Center for Economic and Policy Research (CEPR) set the cat among the pigeons this summer by unveiling a study, on 13 August, concluding that the projected gains from the future transatlantic trade and investment partnership agreement (TTIP) would be very “small” and are “greatly overstated”.
According to the Washington-based CEPR, TTIP would only deliver modest gains of 40 cents per person per day in the US, and €0.20 per person per day in the EU. Supporters of TTIP have touted the supposed gains, but these gains would be easily dwarfed by the losses the great majority of workers would experience due to increased inequality, the US CEPR warns, underlining that the initial studies on TTIP did not examine the costs from protections for pharmaceuticals and other non-tariff barriers. “The projected gains from the proposed TTIP would be so small that it would take 38 TTIPs to make up for the long-term damage the US economy has suffered over the last decade”, says Washington-based CEPR co-director, Mark Weisbrot.
Led by economist David Rosnick, the Washington-based CEPR study looks at a widely cited study by the Centre for Economic Policy Research in London (not affiliated with the Washington study), which estimates that by 2025, under an ambitious scenario, TTIP would increase average consumption in the US by 20-40 cents per person per day, and average consumption in the EU by €0.10-0.20 per person per day. According to the London-based CEPR, tariff reductions under TTIP would increase US GDP by only 0.04% by 2027, Rosnick notes, raising consumption by a little more than a dollar per person per month in the US. In Rosnick's opinion, these optimistic projections come from the London-based CEPR's “significant underestimating” of the costs from patent protections for pharmaceuticals, copyright enforcement and other protections under TTIP “that could increase the price of a product by thousands, or tens of thousands, of percent”. (Emmanuel Hagry)