It is estimated that value added of SMEs to the UK Economy in 2013, was 50% or €473billion. Of all businesses in the UK over 99% of them are SMEs, employing almost 15million people. It is therefore crucial that SMEs benefit from this agreement.
Primarily the current tariffs need to be eliminated. British companies struggle to compete in American markets due to the tariff barriers placed on their products.
UK Sports goods 32%
Synthetic Women’s Coats 16%
Secondly, there is a need for regulatory coherence. For SMEs gaining the knowledge and insight to export to the US is difficult. In order to meet different regulation, different testing, and different licensing small companies are expected to have a wealth of knowledge to navigate the various procedures. This results in a barrier for SMEs to trade on American markets. Through increasing transparency and aligning regulation TTIP can reduce these burdens.
Another big problem for SMEs are the complex and burdensome customs procedures. A comprehensive TTIP agreement would streamline this process, reducing administrative burdens and the hurdles needed for SMEs to export.
SMEs also struggle to see how their product fits within the US market. For example, 70% of products that the EU counts as cosmetics are classed as over the counter drugs in the US, subjecting them to a new level of compliance and regulation. A common appreciation of the identity of products would allow SMEs to export products with ease across both markets.
There will be a specific chapter in the TTIP agreement completely dedicated to SMEs. In this chapter we, the Conservatives in the European Parliament, wish to see all relevant SME regulation explained in full so that these businesses can consult a single document if they wish to expand into the US market.
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