Cage Analysis Administrative

830 WordsJun 17, 20134 Pages
The second element of the CAGE analysis is the administrative distance between two countries. In this case we will be discussing the administrative distance between Germany and the United States. First of all Germany and United Stated do not belong to a common trade block. Although lately rumors occurred of the European Union and United Stated creating a free trade area called the Transatlantic Free Trade Area (TAFTA) or Transatlantic Trade and Investment Partnership (TTIP). However it seems highly unlikely of that free trade are coming into existence due to a number of differences in regulations, trade barriers, etc. Tariff barriers such as the ones imposed on agriculture are politically sensitive. Disagreements exist on regulatory…show more content…
The growth of the EU's economic power has led to a number of trade conflicts between the two powers. However both are dependent upon the other's economic market and disputes affect only 2% of trade. In 2007, a Transatlantic Economic Counsel was established in order to direct economic cooperation between the European Union and the United States. The counsel was lead by the US Deputy National Security Advisor for International Economic Affairs and the EU's Commissioner for Trade. The US and the EU do not see eye to eye on everything, one of the key issues is genetically modified food. The EU has felt domestic pressure to restrict the import of genetically modified food until their safety is proven satisfactory. The US on the other hand is under pressure from its agricultural industry to force the EU to accept imports. They behold the EU's restrictions as protectionary behavior. Economic barriers between the EU/EFTA and the US/NAFTA are considering all relatively low and some efforts have been made to relax trade relationships such as the single sky aviation agreement and the establishment of the Transatlantic Economic Counsel as mentioned before. However the EU and US have many trade disputes, which the majority of them end up before the World Trade Organization, which they are both member off. All industrial imports into Germany are subjected to an "Import Turnover Tax"
Open Document