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GTAP Resource #4599

"The impact of an EU-US Transatlantic Trade and Investment Partnership Agreement on Biofuel and Feedstock Markets"
by Beghin, John, Christophe Bureau and Alex Gohin


Abstract
We assess the impact of a potential TTIP bilateral free trade agreement on the EU and US bio-economies (feedstock, biofuels, by-products, and related competing crops) and major trade partners in these markets. The analysis develops a multi-market model that incorporates bilateral trade flows (US to EU, EU to US, and similarly with third countries) and is calibrated to OECD-FAO baseline for 2013–2022 to account for recent policy decisions. The major policy reforms from a TTIP involve tariff and TRQ liberalization and their direct contractionary impact on US sugar supply, EU biofuel production, and indirect negative effect on US HFCS production. EU sugar and isoglucose productions expand along with US ethanol and biodiesel and oilseed crushing. EU sugar would flow to the US, US biofuels and vegetable oil to the EU. We further quantify nontariff measures (NTM) affecting these trade flows between the EU and the US. EU oilseed production contracts, and EU crushing expands with improving crushing margins following reduced NTM frictions. Our analysis reveals limited net welfare gains with most net benefits reaped by Brazil and not the two trading partners of the TTIP.

Keywords: TTIP, bilateral trade agreement, biofuel, ethanol, biodiesel, sugar, nontariff measure

JEL Codes: F13, Q17, Q42, Q48

The paper is complete and available at: http://www.card.iastate.edu/publications/dbs/pdffiles/14wp552.pdf

Introduction
This paper presents a quantitative analysis of a potential EU-US Transatlantic Trade and Investment Partnership (TTIP), a bilateral free trade agreement, with a focus on its implications for bioenergy and associated feedstock markets. The investigation accounts for EU and US current trade and farm policies affecting biofuel and feedstock markets and energy policies setting bio-energy regulations and targets in these respective economies. Recent assessments of a TTIP already exist (Akhtar and Jones 2012; Atlantic Council 2013 and 2014; Bureau et al....


Resource Details (Export Citation) GTAP Keywords
Category: 2015 Conference Paper
Status: Published
By/In: Presented at the 18th Annual Conference on Global Economic Analysis, Melbourne, Australia
Date: 2014
Version:
Created: Beghin, J. (2/26/2015)
Updated: Beghin, J. (2/26/2015)
Visits: 656
- Bioenergy
- Agricultural policies
- Preferential trading arrangements
- European Union
- North America


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