Brussels, 06/07/2015 (Agence Europe) - In its latest assessment of the EU's trade policy, examined at its headquarters in Geneva on Monday 6 and Wednesday 8 July, the WTO hails the EU's endeavours to maintain the openness and transparency of its trading system.
“Overall, the EU remains an open and transparent economy and (…) plays a critical role in the multilateral trading system”, the WTO summarises.
The EU's trade with third countries is crucial for its economy: trade in goods and services with 107 countries accounted for nearly 35% of its GDP in 2013. Although its exports continued to grow in value and volume, the value of its imports, on the other hand, dropped between 2012 and 2103.
The EU's participation in world trade supports 31 million jobs in the EU, and its strong integration in the world value chains also supports employment in the rest of the world.
The WTO report also underlines the EU's role as a major actor in global investment: 45% of the total outgoing foreign direct investment (FDI) in the world in 2013 came from the EU, and the EU welcomed 48% of the world's incoming FDI. In order to remain an attractive destination for FDI, the EU is currently taking measures to continue the consolidation and completion of its internal market - such as the initiative for a digital single market.
While the EU is negotiating several large-scale bilateral free trade agreements (such as those with the USA and Japan) and deep and comprehensive free trade agreements (going beyond basic conditions governing trade in goods and services by including areas such as investment, non-tariff barriers and intellectual property), it continues to apply its GSP and GSP+ trade preferences schemes in support of developing countries. It also continues to apply its Everything But Arms initiative in favour of the least developed countries (LDCs). EU imports under the GSP stood at €217 billion in 2014, including €38 billion in goods coming from LDCs (in other words, 5% more than previously). The EU also remains “one of the most active members” of the WTO and has often asserted its resolve to conclude the Doha round, the WTO states.
The WTO report notes a large difference in the timing and costs of imports and exports depending on the member states - which is explained more by differences in other areas (like infrastructure) than by customs procedures and prescriptions. Furthermore, the EU is currently implementing the electronic customs initiative (including an automatic import and export system and a one stop shop) which will contribute to reducing the documentation processing time.
The most favoured nation (MFN) tariff profile of the EU has not changed since 2013. Its average tariff remains 6.5% and there are considerable differences from one product group to another: while nearly one quarter of tariff lines are duty free, agricultural products have a higher average level of protection and greater variation from one tariff line to another.
At the end of November 2014, the EU was applying 108 anti-dumping measures and 14 countervailing measures. By contrast, it has not applied any safeguard measure since 2005. Since 2013, the EU has opened 16 anti-dumping investigations - in other words, around two times fewer than over the previous two years. The number of countervailing measures (6) has remained almost the same.
The WTO hails the “significant reform” of the common agricultural policy (CAP) with the adoption of several directives and application regulations targeting the direct payments to agricultural producers and measures concerning markets and rural development, and the reduction to zero of export refunds for all agricultural products since July 2013. However, although the CAP reform can reduce distortion in EU production, the total amount of funding for agriculture and rural development remains above €50 billion per year. Furthermore, as in the framework of previous reforms, the measures on market access (including customs duties, tariff quotas and the special agricultural safeguard) are not directly affected, thus enabling agricultural producers to continue not to be affected by the changes in international prices.
The WTO report states that the large majority of EU sanitary and phytosanitary rules are based on international standards representing interim solutions. EU legislation aims to ensure the functioning of the internal market and a high level of consumer and environmental protection - often higher than in other countries belonging to the WTO.
In addition, the report underlines the positive developments in the EU's fishing system, the reform of which is presented as a positive element for responding to the concerns raised during previous assessments of the EU's trade policy. (Emmanuel Hagry)