Trade agreements to protect our European way of life

Europe’s wealth and prosperity depend in large part on our open trade relations with the rest of the world. We are the most openly trading continent globally, geographically located between the largest economy, the United States, and the most populous and dynamic continents of Asia and Africa. Despite this enormous potential, Europe’s trade agenda is at a standstill. If we are to maintain our global leadership, agreeing on new trade agreements with the democratic world is essential to pursue our interests, protect our values and rebalance our relations with China. The face of global trade has changed dramatically in recent decades and centuries. Built on the bustling marketplaces of ancient civilisations, the emergence of medieval trade routes and the advent of modern globalisation, Europe's economic landscape has been shaped by centuries of commercial exchange. Yet the importance of free and fair trade to Europe is sometimes hard to grasp. Instead of marketplaces, containers are now the most typical face of modern trade and the interconnectedness of economies around the world. Picture those 96 million containers, which were handled in the main ports of the EU in 2022, all lined up in a row. They would stretch so far that they could go around the Earth's middle about 145 times. Last year alone, EU exports were worth more than €2.3 trillion, making the EU the world's second largest exporter after China. Europe continues to uphold its legacy, recognising the pivotal role of trade in driving economic growth, fostering innovation, and strengthening diplomatic ties. With over 30 million European jobs relying on external trade, and with the most of the world’s economic expansion expected to take place outside Europe’s borders, it is clear that our prosperity hinges on robust trade policies.

With over 30 million European jobs relying on external trade, and with the most of the world’s economic expansion expected to take place outside Europe’s borders, it is clear that our prosperity hinges on robust trade policies.

But challenges loom large on the horizon. The EU's trade deficit with China has soared to a staggering €390 billion in 2022, doubling in just two years. Despite the need for a revitalised trade agenda, we find ourselves grappling with the barriers erected by both left-wing and right-wing populist factions. But our trade policies are not just about economic gains - they embody our values and standards. For us, any trade strategy must reflect European interests, ensure reciprocity and safeguard vital sectors like agriculture. We reject the notion of retreating into isolationist fortresses. Instead, we advocate for engagement with the global community whilst nurturing strategic alliances, particularly within a Union of Democracies. Solidarity among Western nations is paramount, particularly in the face of formidable competitors like China. As such, we advocate for deeper engagement with regions like Latin America and the Indo-Pacific, rooted in the principles of fairness and mutual benefit. Therefore, we need new, fair and smart trade agreements in line with our European interests, values and standards, such as with Mercosur or Australia. Africa also beckons as a pivotal partner in our trade endeavours. A new paradigm of trade partnership with Africa must transcend mere economic transactions. It should prioritise mutual development, prosperity, and democracy, addressing global dependencies on key resources whilst empowering local communities. Central to our Group’s approach is a comprehensive de-risking strategy aimed at mitigating uncertainties and fostering sustainable growth, for example by diversifying our supply chain of critical raw materials through new smart trade agreements.

As we chart the course ahead, it is crucial to recognise that trade policy is not a solitary pursuit - it is a collaborative endeavour that requires coordination, innovation, and a steadfast commitment to our shared values. Europe's trade policy must evolve to meet the challenges of a rapidly changing global landscape. By embracing a smart trade agenda, we can navigate the complexities of the modern world while safeguarding our security, economic interests and competitiveness. Together, let us forge a road towards a more prosperous, interconnected, and equitable future for all.