Interview with Kai Büntemeyer, Managing Partner of Kolbus
Is TTIP of any importance at all for companies with their own production in the US?
Kai Büntemeyer: TTIP is just as important for companies that have production facilities in the US as it is for companies who don't manufacture anything there. Because all cross-border processes are still hampered today. More by bureaucracy than by customs. It is not the case that we would be excluded from the market by high customs in the US. It is simply the bureaucracy that makes it seem meaningless to many to enter the market actively there. Kolbus has a small production plant in the US. We managed to co-ordinate our complicated ERP systems for production planning and control on both sides of the Atlantic with each other. And then the bureaucracy comes into play.
Certain designations are not accepted, different regulations are applied. TTIP is enormously important precisely for a German company that wants to establish itself in the US market.
Then is the dismantling of this bureaucracy the greatest benefit of TTIP?
Büntemeyer: The agreement would result in the obstacles to the co-operation that extends across borders ceasing to exist. It's not about the fact that your own production facility has been set up in the US because high protective tariffs have made it too expensive to export machinery there. That is still the case in Russia or also in China, for example. As a highly specialised manufacturer of machinery for a specific purpose, we don't have to have our production close to the market. It would be enough for us if the bureaucracy were simpler and we could save some costs as a result.
The EU has already entered into over a hundred trade agreements. Why are we only now negotiating one with the US?
Büntemeyer: The reason for that is very unfortunate. The launch of the bilateral negotiations on free trade agreements is a consequence of the deadlock in the free trade discussions at the World Trade Organisation. It is only since then that bilateral agreements have come to the forefront. They are only the second-best solution. All the experts know that these kinds of agreements should not be concluded bilaterally, but multilaterally.
How would the mechanical engineering industry react to a TTIP agreement?
Büntemeyer: Companies have long lists of projects in mind. Whether it be weighing up new products, or tapping into new markets, enhancing products through co-operation or accelerating developments. All these plans are still on the back burner at the moment.
There is a great deal of talk about reindustrialisation in the US. Wouldn't TTIP come at exactly the right time for that?
Büntemeyer: Definitely. The revival of the manufacturing industry in the US is progressing in leaps and bounds. I believe that that is a great opportunity for many mechanical engineering companies from Germany. They would build up value creation in the US with a great deal more energy if they could. In the end, both sides will benefit from that, that is obvious. American producers will overall get just as much from that as their European counterparts. And that's why there's some relatively big momentum to do it. So the prospects seem relatively good that something could happen. There is of course a variety of interested parties – that means that not every American or every European has the same interests.
Critics say that TTIP would primarily benefit large corporations.
Büntemeyer: That is utter nonsense. Of course you need to be of a certain size to be able to work transcontinentally. We also have over 1,000 employees, although we conduct ourselves decidedly in the manner of an SME. But I see the threshold as 50 employees, and it's been a long time since that was a major corporation. But in the end, every resident in the enlarged economic area will benefit. Then we'll get more growth as a result, and consumers will be able to afford more on both sides. But it is unfortunately strangely difficult to campaign politically for a project that everyone will benefit from a little but in equal measure. It is much easier to push for a project that a few will benefit a lot from.
Why does a free trade agreement with the US of all things bring so many critics out of the woodwork?
Büntemeyer: I look at these critics with a very sceptical eye. I believe that for many it's simply about retaining power and privileges, and there are sometimes some dubious backgrounds to that. Actually, we never wanted bilateral agreements, because we know that multilateral versions through the WTO would be much better. Initially, the critics concentrated on sabotaging the WTO negotiations. They have succeeded in that in the meantime. But even a bilateral agreement between the US and the EU would be a giant step forward on the road to free global trade. That is why this bilateral agreement is again bringing the opponents of free trade back onto the scene. And in the process some very malicious coalitions emerge. These are people who are against all forms of freedom.
What do politicians have to do, what have they done wrong so far that has led us to having a discussion in public, large parts of which are irrelevant?
Büntemeyer: The politicians should have had the courage to call a spade a spade. The detail that TTIP will bring a little benefit to a great many people is important. It also has to be underlined that it is precisely Germany as an export country that will benefit from free trade with the US. Then it has to be stressed that it is primarily goods that will be exchanged, and services less so. For of course we still have the Atlantic between us. Cleaning crews can easily come over from Poland, but it's not very likely that they will come over from America. Sectors in which Germany is especially strong will be promoted by TTIP. If we want to remain strong and if we want to get on, then we also have to be brave about supporting it. Germany doesn't have any raw materials, but on the other hand we are world champions at exporting. Our prosperity could never have developed without global trade.
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