US economists expect significantly greater benefits from the Transatlantic Trade and Investment Partnership (TTIP) for American farmers than for the EU producers.
Two recent studies of the US Department of Agriculture show that the abolition of customs duties and quantitative restrictions could amount to a increase in profit of 5.5 billion US dollars (5.1 billion Euro) compared to 2011 for the United States alone, due to additional exports particularly beef and dairy products.
The researchers used a relatively high average added tax for these products in their calculations. Perhaps surprisingly the study shows huge gains in the beef sector just through the reform of the quantitative restrictions, even if the EU ban on hormonal growth substances remains. In contrast the EU's agricultural export to the USA could rise by only 0.8 billion dollars (0.7 billion Euro).
If for example the trade barriers for meat fruit and vegetables without added tax would be removed, the US producers could, according to the study, further increase the sales with 4.1 billion dollars (3.8 billion Euro), this includes 2.4 billion dollars (2.2 billion Euro) just for pork.
At the moment the EU does not allow imported pork from the US, due to use of the growth hormone ractopamine in the USA. Furthermore the EU hygiene rules against Trichinella can be regarded as a disadvantage.
Price effects of liberalization
Other trade barriers which could be compared to high taxes, are the EU ban on the chlorine treatment of poultry, the EU import restrictions on genetically modified organisms (GMOs) in particular corn and the EU maximum levels for residues of pesticides on fruits and vegetables.
The end of the trade barriers in the USA would only increase the European exports by 1.2 billion dollars (1.1 billion Euro), mainly for fruit and vegetables. The authors acknowledge that the US rules for import licenses of horticultural products are difficult.
Overall the researchers expect that the comprehensive liberalization will lead to an increase in agricultural price levels in the US, while the EU price levels are expected to decline. The EU's current agricultural trade surplus for the US will be reduced but remain significant.
According to the economists on both sides of the Atlantic the gross domestic product could increase, however the estimated effect is low, about 0.33%.
More information: http://www.topagrar.com/news/Home-top-News-USA-wuerden-von-TTIP-deutlich-mehr-profitieren-2619575.html