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The European UnionThe European UnionTrade PolicyTrade Policy

May 2009

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AGENDAAGENDA1. Today’s Context

2. The EU in world trade

3. EU Trade Policy - Basic features

- How it works

4. Doha Trade Round

5. Bilateral agreements

6. Trade Policy Tools

Conclusion

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CONTEXTCONTEXT

• Globalisation and economic downturn– Global growth : 0.5% (IMF)

– Global trade to fall : 2.8% (IMF)

– EU GDP to fall -2.5%– EU exports down 3.5% (Nov) / Japan 35%

• Collapse in trade finance• Trade is part of the solution?

– G20 commitment– WTO monitoring

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EU remains a trading power…EU remains a trading power…

19% of world trade in 2007, 17% (goods), 27% (services)

First exporterSecond largest

importer

2007 leader in foreign direct

investment:

EU-27 provides €1100 bn (44%)

and recieves € 1100 bn (32%) in

2007.

A MAJORA MAJOR

TRADING POWERTRADING POWER

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The EU in world tradeThe EU in world trade – – 10 major EU export partners (2008)10 major EU export partners (2008)

1. USA2. Russia3. Switzerland4. China5. Turkey6. Norway7. Japan8. United Arab Emirates9. India10.Brazil

19%8%8%6%4%3%3%2%2%2%

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The EU in world tradeThe EU in world trade – – 10 major EU import partners (2008)10 major EU import partners (2008)

1. China2. USA3. Russia4. Norway5. Switzerland6. Japan7. Turkey8. Korea9. Brazil10.Libya

16%12%11%6%5%5%3%3%2%2%

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The EU in world trade 2007The EU in world trade 2007Share of (current) GDP in World GDP

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EU Trade policy - basic featuresEU Trade policy - basic features

Being the leading trade region

Strong interest in:

Open markets

Clear regulatory frameworks

Responsibility to:

EU citizens

Rest of the World

Need to reinforce EU

competitiveness on world

markets

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EU Trade policy – three strandsEU Trade policy – three strands

MultilateralMultilateralWTO – Doha WTO – Doha

RoundRound

Bilateral Bilateral FTAs / RegionalFTAs / Regional

UnilateralUnilateralGSP, EBA etcGSP, EBA etc

3 3 DIMENSIONSDIMENSIONS

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EU Trade policy - How we negotiateEU Trade policy - How we negotiate

The Commission negotiates

• On behalf of the 27 Member States – for certain areas MS are

present e.g. establishment, e.g. criminal sanctions

• Regular reporting to Council and the EP

• Full preparation of prior to negotiations…

The Council decides:• Directives for negotiations• Follows the negotiation

process• Councils approve the

results of the negotiation (generally by qualified majority) – sometimes MS ratify as well

Today, the European Parliament

• Is informed by the Commission

• Gives “assent” on major treaty ratifications (covering more than trade)

Tomorrow the EP co-decides • on legislation and trade on legislation and trade

agreements, but not on agreements, but not on negotiating directives.negotiating directives.

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TRADE POLICY AGENDA : TRADE POLICY AGENDA : GLOBAL EUROPE GLOBAL EUROPE

– Global Trade Talks (Doha Development Round)

– A new relationship with developing countries (particularly ACP)

– Bilateral Trade Agreements• Korea, ASEAN, India, Central America, Andean

Community, Ukraine, Euromed, • Mercusor, Gulf States, Libya, China

– Strategic partners • Russia, China, Brazil

– Defending European interests

– Promoting European values

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The Doha Development Round (DDA)The Doha Development Round (DDA)Context

• Launched in 2001

• Broad coverage – goods, agriculture, trade rules, services – but less than originally hoped (“Singapore issues”). Cancun 2003. Hong Kong 2005. Geneva 2006. Geneva 2008 (July)….2009?

• Who negotiates?

The big questions

• Where are we today?

• Will this make a difference for development?

• Will this be a good deal?

• And will we get there in the end?

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Reaching beyond the borders…Reaching beyond the borders…• Trade is no longer just about tariffs…

• Trade is not just about trade…

Environment (Copenhagen)Labour Rights (Belarus)

Human Rights (Danish cartoons)

Standards (Latin America)Licensing practices (China)

Domestic taxes (India)

TRADE

TRADE

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Removing trade barriers for EU exportersRemoving trade barriers for EU exportersMarket Access Strategy

Context

• Creating a new opportunities for EU exporters• Market Access Partnership launched in 2007 as a cooperation

between the Commission, member states and business – local expertise make trade barriers easier to identify and adress.

• Market Access teams created• Market Access Database (MADB) as an important tool to

record barriers under examination in EU trading partners.

Any success stories?

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Bilateral relations (FTAs)Bilateral relations (FTAs)

Context

• Globally more than 200 FTAs – (36% of global trade).

• FTAs top up what can be done in WTO.• ‘extended’ regionalism

The big questions

• Impact on the WTO system?• Spaghetti bowl effect?

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Who are we negotiating with?Who are we negotiating with? Economic Partnership (EPAs) with ACP Economic Partnership (EPAs) with ACP

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EU Trade policy – standing up for EU Trade policy – standing up for European InterestsEuropean Interests

The trade defence instruments

“Defensive” instruments to ensure fair trade and defend the interests of European companies…

... have been designed in line with specific WTO agreements recognising the right of members to counter unfair practices:

SafeguardsAnti-dumping Anti-subsidy

– Cutting edge of globalisation debate

– Green Paper Review exercise 2006-2007