European Commission Directorate-General for Trade

United States

No other economic relationship in the world is as integrated as the transatlantic economy.

The EU and the US economies account together for about half the entire world GDP and for nearly a third of world trade flows.

The transatlantic relationship also defines the shape of the global economy as a whole as either the EU or the US is also the largest trade and investment partner for almost all other countries in the global economy.

EU-US economic cooperation

The EU and the US enjoy the most integrated economic relationship in the world, illustrated by unrivalled levels of mutual investment stocks, reaching over €2.1 trillion. Total US investment in the EU is three times higher than in all of Asia and EU investment in the US is around eight times the amount of EU investment in India and China together. Investments are thus the real driver of the transatlantic relationship, contributing to growth and jobs on both sides of the Atlantic. This can also be illustrated with approximately 15 million jobs linked to the transatlantic economy. It is estimated that a third of the trade across the Atlantic actually consists of intra-company transfers.

Non-Tariff Measures in EU-US Trade and Investment

The transatlantic relationship has an enormous potential which is far from being fully exploited. Given the low average tariffs (under 3%), the key to unlocking this potential lies in the tackling of non-tariff barriers. These consist mainly of customs procedures and behind the border regulatory restrictions. They come from diverging regulatory systems (standards definitions notably), but also other non-tariff measures, such as those related to certain aspects of security or consumer protection.

In 2009, a study was carried out for the European Commission which identified the most important Non-Tariff Measures (NTMs) that affect trade between the EU and the US, and estimated their economic impact. The main findings of the study were that the removal of half of the existing NTMs and regulatory divergences would translate into an increase in GDP of €163 billion until 2018 on both sides of the Atlantic.

• Read the study

Transatlantic Economic Council (TEC)

The TEC was set up in 2007 to guide and stimulate the work on transatlantic economic convergence

• Read the Framework for Advancing Transatlantic Economic Integration between the USA and the EU

The TEC brings together those Members of the European Commission and US Cabinet Members who carry the political responsibility for closer economic ties. The progress achieved through the many dialogues and other cooperation activities is traditionally reviewed by the TEC at its annual meetings. New targets for achieving the goals set out in the Framework for Advancing Transatlantic Economic integration are also usually fixed at TEC meetings.

After the relatively disappointing results of the initial approach, the new co-chairs of the TEC, Commissioner De Gucht, and US Deputy National Security Adviser for International Economic Affairs, Michael Froman, agreed in early 2010 to reposition the work of the TEC. It was agreed to focus the regulatory work of the TEC on economically relevant issues of mutual interest, to identify a number of issues where EU-US cooperation could produce achievable results in a reasonable time frame and to engage in a strategic discussion on selected global economic issues. The rationale of the TEC is clear: to ensure transatlantic convergence by preventing barriers and by creating new opportunities for business and thus contributing to the overall political priorities of generating growth and jobs.

The EU-US Summit of 20 November 2010 in Lisbon underlined the important role of the TEC and tasked the TEC "to develop a transatlantic agenda to stimulate growth and create jobs in key emerging sectors and technologies". The TEC was also asked "to identify ways to improve transatlantic consultation before regulators and agencies develop regulation in economically promising new technologies and sectors, to share best practices, and to develop joint principles with the aim of promoting maximum compatibility of regulations and the freest possible transatlantic flow of ideas, products, and services".

The last meeting of the TEC was held on 17 December 2010 in Washington DC.

• Read the EU-US Summit Joint Statement (Lisbon, 20 November 2010)
• Read the Joint Statement of the EU-US TEC meeting of 17 December 2010
• See latest documents related to the TEC

The TEC is currently the only EU-US high level forum in which economic issues can be discussed in a coherent and coordinated manner. It brings together the wide range of ongoing economic cooperation activities and provides for a platform to give political guidance and direction to this work. At the same time, the TEC provides for a political forum for discussing strategic global economic questions. Overall, the – so far untapped – potential of the TEC is considerable: it can serve as an important strategic and economic tool in the creation of a transatlantic market place. The TEC is one of the most important projects in transatlantic relations.

Three 'advisory' groups have been set up to help guide the work of the TEC: the Transatlantic Legislators' Dialogue, the Transatlantic Consumer Dialogue and the TransAtlantic Business Dialogue. In addition, civil society at large is consulted on the TEC's objectives and debriefed after its annual meetings. The reports of TEC meetings are available to the public.

Trade Disputes

Inevitably for two economies of such size with such a high volume of trade, the EU and the US encounter a number of trade disputes which are handled through the dispute settlement mechanism of the WTO.

Although they tend to grab headlines, disputes currently only impact some 2% of EU-US trade.

Supporting information

• Reports
• Texts
• Links