Brussels, 29/10/2008 (Agence Europe) - In a first speech due to be made at the Business Europe-organised conference on Tuesday 28 October in Brussels, Catherine Ashton warned against resorting to protectionism in response to the financial crisis. The new commissioner for trade said that, on the contrary, a WTO agreement concluding the Doha Round negotiations was more necessary than ever.
Following on directly from her predecessor, Peter Mandelson, Ms Ashton pointed out that giving into protectionist temptations would only make economic recovery more difficult. The commissioner affirmed that “the risk, particularly if the downturn is severe, is that countries restrict markets in an attempt to isolate themselves…I am convinced that this is a dead end. Not because openness is an end in itself, but because experience has taught us that it is the most effective way to achieve our broad economic, social and indeed political goals”. Ashton believes that a WTO agreement on the liberalisation of world trade is needed, negotiations of which have been blocked since the failure of the Geneva ministerial last July. Ms Ashton insisted that a global trade deal “has its part to play in addressing the current crisis…it will lock in the openness of the international economy. I can think of no more urgent priority for long-term global welfare”.
As well as the need for strong EU involvement in the Doha negotiations, Ashton appealed for a positive EU commitment in the global economy, in a context of lowering investment and falling demand. This commitment requires the opening up of markets and a good balance between regulation and reform, in order to survive the current crisis and ensure the sustainability of the European economy.
The commissioner explained that “it is clear that we must reform our systems of regulation at national, regional and global levels - smarter regulation…The task for politicians, and business leaders, in the months ahead will be to explain the difference between, on the one hand, the steps necessary to help our economies weather the downturn and to ensure that the regulatory gaps of this crisis are not repeated; and on the other hand, interventions and excessive use of public subsidies - while attractive today, will damage us tomorrow. We all know that protectionism makes recovery harder. But sometimes in the face of crisis, we risk throwing away what we know”.
In a speech that was quite general, Ashton obviously did not refrain from underlining the need for Europe to increase its economic relations with “the major economies of the next generation”, particularly Asia, and to negotiate with its key partners on issues that “will determine the EU' competitiveness in the 21st century”: investment, public procurement, competition, intellectual property and access to resources. As much for the domains that have been covered in a cursory way or not at all in the WTO field of action, the so-called “the Singapore subjects” (they were removed from the Doha negotiations due to pressure from developing countries during the 2003 Cancun meeting), which limit access to the market and create non-trade barriers. Commissioner Ashton insisted that they had to “ensure that our exporters, no matter how big or small, get fair treatment abroad”. She also promised to pursue the new market access strategy (EUROPE 9409 and 9606) launched at the beginning of 2007 by the European Commission as part of the EU's Global Europe strategy for trade. In this context, the commissioner highlighted the importance for the EU in the years to come to deepen economic, trade and regulatory relations with its main partners in order to guarantee better coordination of economic policies. The Transatlantic Economic Council and the senior level dialogue mechanism with China are, insisted Ms Ashton, going to be essential to this end.
The commissioner concluded by underscoring the role of opening up trade and investment in current policy. She promised to put the question of relations with China on the agenda and explained: “We have a clear overarching objective to move to a low-carbon, high growth economy. I known there are concerns in parts of our industry about how we do that. We will have to address these in the context of Copenhagen. But we also have a proactive agenda which we must pursue. I would like to see us, for example, improving access for European environmental investment and green technologies”.
Commission promises policy continuity
Before the speech by his new boss, Director General of DG Trade David O'Sullivan promised that there would be continuity in the European Commission's policy. As well as the Doha Round, negotiations for bilateral free trade agreements are obviously going to be a priority in the next few months. Despite questions still pending, discussions with South Korea are “more advanced and an agreement is possible in the next few months”. Discussions with India “are very dependent on its political context and its commitment to reform”. The challenge of discussions with ASEAN should be kept on the right track and the EU, according to O'Sullivan, should adopt the commitment of Brunei, Singapore, Thailand and Vietnam as a basis to moving forward, while paying full attention to the regional integration process. Finally, O'Sullivan promised that efforts would continue in order to complete the market access strategy and the strategy on the protection of intellectual property rights in developing countries. (E.H./transl.rh)