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TTIP: Another Step in the (Lack of) Evolution in EU Trade Agreements

As the Transatlantic Trade and Investment Partnership (TTIP) approaches an eighth round of negotiations between the United States and the European Union, the debate regarding genetically modified organisms (GMOs, or crop plants bred with genetic engineering methods) continues to raise important stumbling blocks. Despite a large and growing body of scientific evidence showing that GMOs are no more risky for consumers or the environment than conventionally bred crops—much of it paid for by the EU and conducted by public sector scientists in Europe, public sentiment in Europe remains worried about them (although there is evidence that this concern is exaggerated).

Consequently, many European governments harbor official concerns about the effects of GM crops on human and environmental health. The EU has imposed arguably the strictest GMO regulations in the world, which it rationalizes on the basis of the precautionary principle, the view that any possible risk, however unlikely, provides grounds for bans or severe restrictions. Because the EU has approved only two GMO crop varieties for planting and has approved only a third of the 100 or so GMO crops grown in the US for import as food or animal feed, the precautionary principle could very well halt what would be the world’s wealthiest trade agreement. 

As Pierre Desrochers of the University of Toronto points out in an analysis (written for the new European Policy Information Center) of the Comprehensive Economic and Trade Agreement (CETA)—an agreement similar to the TTIP between Canada and the European Union—the EU’s use of the precautionary principle to obstruct the import of GMOs is nothing more than a non-tariff barrier to trade, conveniently protecting “otherwise uncompetitive locally produced foods.” Although the ban on GMOs is aimed at protecting the environment as well as the European consumer, GMOs actually cut down on environmental degradation that would otherwise occur with pesticides and herbicides. According to one study by the consulting firm PG Economics, between 1996 and 2012 GMO crops reduced pesticide spraying by 8.8 percent in the countries that planted them, while increasing yields and letting farmers produce more food on less land. And because farmers had to spend less time ploughing, weeding, and spraying their fields, carbon dioxide emissions from tractors and other farm machinery were reduced by 23.1 billion kg in 2011 alone. 

Of course, GMOs are not the only agricultural sector in which the European Union has used in the precautionary principle to protect domestic producers from external competition. Consider the inconsistencies in the EU’s restrictions on meat imports. As CEI’s Greg Conko has pointed out, the EU has for many years banned imports of beef from cattle that have been given growth hormones, as most cattle in the U.S. and Canada are, even though the scientific studies cited by the EU did not indicate a health risk. Nor did the EU ban the use of growth promoters in the pork industry. The difference between beef and pork is the fact that many European countries, particularly Denmark, are globally competitive in pork production, which means that the U.S. does not have a comparative advantage that will put the local pork producers of the EU out of business. In the case of beef, on the other hand, the U.S. and Canada have a clear market advantage, and the EU assumed European cattle ranchers needed protection. Thus, the ban on beef, claimed to be a measure to prevent miniscule health risks to consumers, is almost certainly just a protectionist provision by the European Union. 

Although a large issue in trade agreements in the past, as well as the most recent agreement between Canada and the EU, GMO’s are proving to serve as an obstacle yet again in the TTIP negotiations between the U.S. and the EU. Stalled on the issue, it seems that neither party will be able to benefit fully from trade of the freest kind. If the EU remains unpersuaded on the GMO issue, little progress can be expected. The hysteria towards GMOs will cause long-term problems for the EU, however, as the rest of the world continues to use GMO crops and outpaces the EU in agricultural productivity. Moreover, the wider benefits to the EU from TTIP should persuade the Council of Ministers that GMO policy should not cause the deal to stall any further. Therefore, it would be in the EU’s best interests to be more open in the current TTIP negotiations with the U.S., and overcome its “genetically modified fear.”