We live in time of economic crisis where economic flows are volatile, and there hasnt been

any right solution how to stop that. Europe has been trying to land on its feet for more than
seven years since crisis occurred and progress that has been made wasnt enough to create
critical mass that will light up the fire of once strong European economy. What if the solution
lies in implementation of trade agreement, in this case a very specific one called TTIP? There
are divided opinions whether TTIP is a good or bad thing for European Union, people are scared
of deeper crisis because they had suffered financially and socially enough. Fear also comes
from the fact that the USA has many multinational companies (corporations) that could take
over the European market which could crumble European standards. This is not the only fear,
yet another one come from the fact that the USA has a wider range of GMO products than the
Europe, which Europeans fear it could flood European market and endanger health of all
Europeans. Those are merely a fragments that worry Europeans across all 28 countries. The
exact problem lies in the fact that TTIP isnt recognized as a possible advantage rather than
disadvantage, threat or something unwanted on European territory. People often forget that
every coin has two sides, so does TTIP.

Firstly, it is well known in economics that when there are more countries to trade the impact of
money flow generated from trade will have more positive effects on all included countries due
spillover effect. TTIP results trade agreement where export/import will increase in both
included parties (USA and EU28). Secondly, such matter creates an opportunity for specific
products that might have struggled on domestic market by allowing the access to a much
bigger market. Furthermore, evidence that confirms this argument can be found at case of
NAFTA (North American free trade agreement) that had boosted Canadian economy which
resulted with much better standard of living and reduced impacts of crisis intervals that struck
the USA. Similarly to the NAFTA case the TTIP should have similar effects, if not stronger.
There is no doubt that TTIP could cause loss of jobs which will result with higher
unemployment. Why? Well, the answer is pretty simple, if the Europe produces the same goods
as the USA by lower production costs, it is logical from the point of the USA to import such
good rather than producing it by its own. As previously stated such thing leads to slightly higher
unemployment and requires structural reform. Reduction of barriers and tariffs between the
USA and EU caused by the TTIP might cause some externalities. For example, there could be
reduced trade flows with third countries, but the money that has been used to overcome barriers
and tariffs between EU and USA will stay in the EU countries causing better convergence of
specific EU regions. But the true question is, what will happen with countries that are not

included in the TTIP agreement? Will Europe abandon trade agreement with countries such as
Turkey that has customs union with the EU? Not only that trade flows will reduce between EU
and the Turkey but also Turkey in that case wont be able to do much since its not the EU
member and it has been struggling to become one for some time now. On the other hand, the
main problem of the TTIP is lack of transparency, by this I am not saying that Commission
hasnt been transparent, but rather it hasnt been transparent enough. To put it in another way,
such transparency wasnt enough to convince people that TTIP could bring benefits. Otherwise
there wouldnt be so much those who doubt and oppose the agreement.

Realisation of the TTIP can only mean good for Europe, especially European small and medium
enterprises (SME). Because along with the European market there will be more possibilities on
American. I am confident that European small and medium enterprises will overpower the
American, since they are core of the European economy. Europe constantly invests in
development of small and medium enterprises whereas the US economy is mostly made of
multinational companies and I strongly believe that European advantage is in the quantity where
Europe should exploit it as an advantage. Moreover, I consider that positive effects will
overcome the negative ones. International political economy has proven so many times that
trade agreements have boosted economies for all including parties, and that should also be case
in of TTIP. Along with economical stability TTIP should result also with political stability
which Europe needs more than ever and in that case TTIP seems like a strong cure for
euroscepticism which is currently present.

To conclude the essay, no matter on negative effects that TTIP could bring to trading
parties history has shown that there always have positive impacts on the certain economies that
were part of trade agreements. In the case of the TTIP, Europe is the one that must take huge
advantage of whole trade agreement which will allow better economical and political stability.