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Country Report Lithuania Product Image

Country Report Lithuania

  • ID: 2138679
  • November 2014
  • Region: Lithuania
  • 25 Pages
  • The Economist Intelligence Unit

Negotiations on the Transatlantic Trade and Investment Partnership (TTIP) have reached a critical stage as domestic pressure has ramped up over the terms of a deal. The US and the EU account for almost half of the global economy, and lower barriers between the two would unleash a wave of economic activity whose effects would ripple around the world. However, the European Commission faces opposition from powerful EU member states and the US administration faces an increasingly assertive Congress. On balance, the Economist Intelligence Unit believes that economic headwinds and geopolitical tensions have increased the incentives for policymakers to reach an agreement on TTIP to boost growth, and that a deal will be signed.

On the EU side, the European Commission has been given a mandate to negotiate TTIP by the Council of Ministers. However, any agreement has to be approved by the European Parliament and the European Council. Adding a further layer of complexity, a legal and political consensus has emerged in recent weeks defining TTIP as a "mixed agreement", which means it would also have to be ratified by national legislatures. This would significantly increase implementation risks and constrain the Commission's room for manoeuvre. In Germany for instance, both houses of parliament would have to back a deal.

While negotiations had initially been calm and low-key, the more recent emergence of a chorus of critical voices in some of the core EU countries has politicised the process. These critics have gained influence, especially in Germany, which traditionally supports free-trade agreements. A general deterioration in relations with the US amidst a spying scandal has contributed to the growing German public suspicion towards TTIP.

Country Report Lithuania

US-EU trade talks reach critical stage
Aversion to TTIP growing in some EU member states
Scepticism also high on US side
Election results create complications
Geopolitical tensions and growth worries mean that deal still likely

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