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Europe Daily Bulletin No. 13064

17 November 2022
EXTERNAL ACTION / Interview trade
EU’s future ‘anti-coercion’ tool must be reactive, says Bernd Lange
Brussels, 16/11/2022 (Agence Europe)

The European Parliament and the Council of the European Union are expected to start interinstitutional negotiations (‘trilogues’) on the regulation establishing an ‘anti-coercion’ instrument shortly, after the EU Council adopted its mandate on Wednesday 16 November (see other news). The European Parliament’s rapporteur on the text and Chair of the Committee on International Trade (INTA), Bernd Lange (S&D, German), details what the Parliament hopes for concerning this dossier in an interview with EUROPE. (Interview by Léa Marchal)

Agence Europe - Your report on the ‘anti-coercion’ tool adopted in the INTA Committee in October (see EUROPE B13039A19) adds, among other things, an article to define certain terms. Why?

Bernd Lange - In the proposal by the Commission, it was quite vague what coercion is, what the union interest is, what concrete measures are.

In normal legislation, we always have Article 2, which gives us definitions. This was missing in this proposal, and therefore I introduced it.

So we have more clarity, because this is also quite tricky regarding foreign and security policy. This is a trade instrument and not a political instrument, and therefore we should really be precise with what we mean by economic coercion.

Your report also proposes to set a time limit for imposing countermeasures, whereas the Commission wanted to leave some flexibility to adapt to very different investigation cases...

This is an instrument of emergency. Now, with the timeline we introduced, I guess the whole procedure will take about one year even if this is not quite quick.

But of course I recognize that there is some need for proper investigation on the coercion measure. So it will take time, but in principle there should be a quick reaction on a measure, quicker than a normal World Trade Organization (WTO) case.

Member States want to have a say in the decision on recognising economic coercion. Do you think this is a reasonable proposal?

I guess it is a legitimate interest of the EU Council to want to be involved in the whole process and then in the decision making process. 

There are two crucial decision points. One is the determination of an investigation. And, secondly, the concrete decision of countermeasures.

These two points of decision do not have the same weight. The decision, if there is a coercion, is more based on the criteria we have developed and the investigation by the Commission. I guess this should be, in my point of view, the normal procedure.

The other point of decision, the countermeasures, is a little bit more complicated because of the consequences which might really harm Member States in a different way. The role of Member states could or should be here stronger than in the normal procedure. But let’s see, we will talk to the EU Council and I'm convinced that we will find a good compromise.

How should the EU act towards Beijing?

It’s clear that after the 20th Communist Party Congress, the political side of the game is much more developed than the economic side. Also, the change in the leadership positions makes this, I guess, quite clear. I see that there is awareness about the economic dependences between European Union and China. So it’s not just a one way ticket, it really depends on both sides.

Therefore, there’s a need to talk, and we should really intensify our dialogue with China to have some solution in the common interest, not hiding the question of values and the human rights issue.

And certainly we should also look to diversify our investments. 

Finally, on the subject of transatlantic relations, do you agree with the German Minister of the Economy that the time is right to relaunch discussions on a trade agreement with the United States?

It is totally unrealistic.

We have really a lot of items where we’re in competition, and the USA adopted just this Inflation Reduction Act (IRA) where they made a lot of subsidies for a lot of elements related to the green transition (see EUROPE B13054A2).

The second argument is, because of the political situation in the US, it is not possible to get from the Congress a Trade Promotion Authority. So there will be no basis for a trade agreement.

And this is also the reality of the United States in relation to other countries.

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