Last September, TradeMoves posted about an opportunity for US small and medium-sized enterprises (SMEs) to tell US negotiators which trade barriers are disproportionately affecting their exports to the European Union (EU). The US International Trade Commission (USITC) received written submissions from SMEs and listened to interested parties at roundtables held around the country, and the information they compiled is published in a report entitled, “Trade Barriers that U.S. Small and Medium-Sized Enterprises Perceive as Affecting Exports to the European Union.” The full text of the report can be found here. The report first provides an overview of “cross-cutting trade barriers” affecting all SME exporters to the EU, categorized into four groups: standards and regulatory issues, intellectual property issues, logistical issues, and finance-related issues. The remainder of the report delves into sector-specific issues along with recommendations to increase SME participation in trade for that sector.
On behalf of US SME exporters of processed foods, TradeMoves submitted comments to the USITC on the complexity of the EU's tariff system which combines ad valorem tariffs with a specific agricultural tariffs based on the composition of the product. This system, known as the Meursing system, can act as a barrier to trade as determining the actual tariff cost for entering the EU market can be difficult to navigate.
The Census trade data cited in the report clearly illuminates why the EU is an important export market for US SMEs, regardless of the sector. As Ambassador Michael Froman stated when the report was released, “nearly 95,000 U.S. small businesses export to the EU, sustaining good jobs at home.” However, only 30 percent of the total value of annual exports to the EU come from SMEs. The Transatlantic Trade and Investment Partnership (TTIP), in its final form, will undoubtedly result in economic gains on both sides of the Atlantic. The report should help inform US negotiators as they work to create a business environment that can unlock the full potential of SMEs in the trans-Atlantic marketplace. As Ambassador Froman indicated, SMEs are “the backbone of economic growth, job creation, and a stronger middle class in communities across America.”
The 5th round of TTIP negotiations are scheduled to take place in Arlington, Virginia from May 19 through 23. USTR has provided a factsheet on how a successfully negotiated TTIP “will benefit workers, businesses of all sizes, and consumers.” More information on the next round of negotiations can be found on USTR’s website.
Please contact TradeMoves LLC for any additional questions on how the TTIP might benefit your company.
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