On 18 and 20 February, the 14th review of the European Union’s trade policy took place at the World Trade Organization (WTO) in Geneva. This was an opportunity for the members of the organisation to point out what they consider to be the excesses and shortcomings of this flagship EU policy.
The CAP pinned
Among these, the EU’s trading partners blame the high level of protection of the European agricultural sector during March 2017 to September 2019, the period under review. This provided an opportunity for the European representative, João Aguiar Machado, to highlight the EU’s efforts to abolish all distorting effects, such as sugar quotas (abolished in 2017). And to point out, in a thinly veiled reference to the United States, that this policy “contrasts sharply” with that of other important WTO members, reported a Geneva source. This decoupling policy will be increased in the EU’s post-2020 Common Agricultural Policy to reach 90% decoupled support in all direct payments, the ambassador said.
Standards under surveillance
Sanitary and phytosanitary standards (SPS) and measures in the EU, the world’s second largest agricultural importer, are perceived both as quality benchmarks and as barriers to trade. US Ambassador Dennis Shea said he was “deeply concerned by unjustified EU barriers to our agricultural exports”, citing pesticide policy and other non-tariff barriers.
The EU responded to members’ questions on this point, stressing the transparency and conformity of its procedures with the WTO SPS Agreement, including in the setting of maximum residue limits for pesticides. The EU also provides its developing partners with technical and financial support in this area, benefitting more than 80 countries in 2017-2018.
With regard to standards policy, some technical standards are also perceived as barriers to trade by some members. The EU stressed that, in developing its standards in sectors such as medical equipment, chemicals, and high-tech products, it was pursuing legitimate interests: protection of health and the environment.
The EU “that defends”, Green Deal, Brexit, etc.
Other issues frequently raised by members were the EU’s trade protection policy, in particular the introduction of a new method of calculating dumping based on the principle of “serious market distortions” and the protection measures on steel imports. The investment screening mechanism was also singled out.
Current affairs issues were also identified by members: Brexit, including the distribution of tariff quotas, taxes on digital services from EU member states, and the European Green Deal and its possible impact on trade issues.
On this subject, the EU representative underlined the contribution that European trade policy intended to make to the objectives of the Deal. Any carbon adjustment measures at the borders will be in line with the EU’s WTO obligations, Mr Machado also said.
United States, China
In response to US Ambassador Shea, who criticised the EU’s continuing trade surplus with his country, Mr Machado stressed that the EU’s trade relations were not “a simple calculation of how many goods in versus how many goods out”. Mr Shea also criticised the EU for using its free trade agreements (FTAs) and other technical assistance programmes to impose its “misguided domestic policy”.
Finally, Chinese Ambassador Zhang Xiangchen applauded the EU’s efforts in favour of the multilateral trading system and the reform of the WTO, but pointed out its misdiagnosis of the reasons for the crisis in the multilateral organisation (industrial subsidies, forced technology transfers, state intervention). He also deplored the “defensive” path that he said EU trade policy is taking. (Original version in French by Hermine Donceel)