The Transatlantic Economic Council

Background TEC

The Transatlantic Economic Council (TEC) is the most recent addition to the existing set of transatlantic institutions. It was established by Section IV of the Framework for Advancing Transatlantic Economic Integration between the United States of America and the European Union signed on April 30, 2007 by U.S. President George W. Bush, German Chancellor Angela Merkel (the then President of the European Council), and EU Commission President Jose Manuel Barrosso. The TEC has several permanent members: on the European side, the Commissioners for External Relations, for Trade, and for the Internal Market and Financial Services, and on the U.S. side, the Secretaries of the Treasury and Commerce and the U.S. Trade Representative.

TEC is co-chaired by a U.S. Cabinet-level official in the Executive Office of the President and by a Member of the European Commission, collaborating closely with the EU Presidency. The current co-chairs are Allan Hubbard, Assistant to U.S. President G.W. Bush for Economic Policy and Director of the National Economic Council, and Guenter Verheugen, Vice-President of the European Commission and EU Commissioner for Enterprise and Industry.

The Transatlantic Economic Council aims to make transatlantic cooperation more transparent and provides a channel for stakeholders to make their views known. This is why the TEC meets with its Group of Advisers, who are tasked with articulating the views of citizens, consumers and producers on both sides of the Atlantic on the priorities that should be pursued. TEC is tasked with achieving both regulatory convergence in various industries (Annex 1 of the Framework) and progress on the following Lighthouse Priority Projects, priority growth programs aimed at enhancing transatlantic economic integration (Section III and Annex 2 of the Framework)

• Intellectual property rights
• Security standards for international trade
• Promoting the recognition of U.S. GAAP (Generally Accepted Accounting Practices) in the EU by 2009 or sooner
• Innovation and Technology
• Regular dialogue to address obstacles to investment

The April 30 Framework was ratified neither by the Senate Foreign Relations Committee as a treaty, nor by the House Foreign Affairs Committee as a law. Although EC President Jose Manuel Barrosso spoke of TEC as “a permanent body, with senior people on both sides of the Atlantic ,” TEC enjoys as much political support as the two appointed officials can gather. It is imperative, then, that political support does not ebb in time.

Angela Merkel’s successful efforts to secure agreement on this matter from Slovenia and Portugal , the two countries with which it shares the EU trio presidency until 2008, show that the EU is game on ensuring political continuity. One hopes that TEC potential will not fall victim to the political battle between Congress and the White House or lie fallow because of declining support for transatlantic integration in the next U.S. Cabinet.

The EU-U.S. economic partnership is the deepest and largest bilateral trade and investment relationship in the world. Trade flows across the Atlantic are running at around $1.7 billion a day. The EU is home to almost 70 percent of total outward U.S. investment. In 2005, American companies invested four times as much in Belgium as they did in China the following year.

Some facts:

Annual bilateral trade: US$909 billion (Euro 620 billion)

Combined trade: 40 percent of world trade

Combined Gross Domestic Product (GDP): 40 percent of world GDP

Bilateral investment flows provide 14 million jobs

For further information:

Transatlantic Economy News

Text of the TEC Agreement (30 April 2007)

TEC: Review of Progress under the Framework for Advancing Transatlantic Economic Cooperation between the United States of America and the European Union

Report: Advisory Committee on International Economic Policy (ACIEP) Meeting (10 March 2008), U.S. State Department

Report: Second Meeting of the Transatlantic Economic Council in Brussels, Belgium (15 May 2008)