International trade, alongside foreign policy, is the most vital external policy tool for the EU to secure growth, employment, and its competitiveness on the world stage. This is best achieved through a multilateral, rules-based trade order.
It is the best means to achieve fairness in international trade, legal certainty through a dispute resolution mechanism, and thus the best framework to secure investment, jobs and growth around the globe. The EU should continue negotiating and concluding agreements with countries and trading blocs all over the world.
The EPP Group wants the EU to be the champion of a rules-based trade order, for trade wars would result in a lose-lose situation for everyone and destroy many of the positive developments achieved over the last decades.
EU as a standard setter
During the 2014-2019 parliamentary term, we have achieved a considerable number of trade agreements with third countries such as Canada (CETA), Japan (JEFTA), South Korea, and Singapore. It is important to note that the EU managed to achieve new incentives for jobs and growth. Trade agreements stimulate many business sectors across the board, in particular manufacturing and services. Market access for European companies secures real reciprocity with our trading partners and creates a win-win situation. In addition, high environmental, food-safety and labour standards benefit European companies and create a level playing field.
Investment protection provisions create a favourable business environment. The EPP Group has always favoured including investment protection rules with solid and independent judicial dispute resolution bodies. To maximise legal certainty for investment, a joint and independent dispute settlement body is the best way forward. Rules must be reliable and enforceable for both parties.
We strongly believe in cutting-edge standards as this is the only way the EU can secure a global playing field as close as possible to our domestic standards. There must be no underscoring of environmental or labour standards. This is also a powerful tool to fight inhuman or environmentally-devastating trade including products or services based on child labour or deforestation, for example.
We believe in open markets and this is why it is vital for the EU to have trade defence instruments to have a level playing field. Subsidised exports or dumping practices undermine fair trade. Moreover, they ruin our domestic manufacturers and endanger thousands of jobs. This is why we need to fight protectionism. As a complementary measure, we have recently achieved a piece of EU internal legislation on the screening of foreign investment. This enables the EU to identify State-owned investors from third countries with no market access and to defend our domestic core businesses.
What we want to do in the next 5 years:
We have to pick-up on EU-US trade relations. The Juncker-Trump agreement has paved the way for negotiations to resume and defuse mounting trade tensions with the US. The EU and the US should aim at a transatlantic partnership of equals. The overall aim should be to reduce tariffs as much as possible and to scrap them altogether. Tariffs are barriers to trade stifling competition and innovation.
As Britain is leaving the European Union, we need to make sure that a comprehensive economic partnership rooted in trade is put in place. To date the UK has been an important contributor to the rules-based EU Internal Market. We should bring the future relationship with Britain as close as possible to the common market.
A comprehensive trade agreement with Mercosur (Argentina, Brazil, Paraguay and Uruguay) is a further priority. Mercosur plays a vital role as one of the world’s most powerful exporters of agricultural products. There is a great chance to arrive at common high standards for food safety and sustainable production of crop and meat. We need a fresh start to be able to finally conclude an agreement after almost two decades of negotiations.
China, as the EU’s second largest trading partner after the US, remains a medium-term priority of the utmost importance. Efforts should be undertaken to at least achieve a framework for future trade talks where market access and public procurement issues are paramount. ASEAN is a crucial trading partner for the EU too. We need to build on the successful EU-Singapore trade agreement reaching out to the other ASEAN states.
For the EPP Group, international trade is a powerful tool to secure jobs and growth to stimulate competition and innovation. Likewise, it is beneficial for European businesses to have ambitious environmental and safety standards all around the world. We are determined to work for a strong EU as a standard setter in world trade for the benefit of consumers and businesses alike.