Trade

“Making the European Union a fully-fledged player in international trade”. By Alain di Crescenzo and Marie-Pierre Vedrenne

Geopolitical tensions, the Covid-19 shock, the war in Ukraine, the factors of upheaval follow one another and confront our companies with increasingly growing instability. Strategic autonomy becomes, in this uncertain context, the compass of the European Union. It is time for the latter to equip itself with all the instruments of power in order to effectively guarantee the conditions of fair and loyal competition.

The French Presidency of the Council of the European Union, which has the ambition of sovereignty on its agenda, calls for the rediscovery of the notions of solidarity, unity and fair competition, which are part of the foundations of the European Union. Recent experiences show, and this is a positive element to underline, that these principles remain unifying in times of crisis and that European identity can still assert itself. The conviction of French SMEs, reaffirmed by a study that CCI France has just carried out, is that only a united and strong European response will allow major progress.

Reciprocity, a milestone that is becoming a reality. Between the “Buy American Act”, the virtual impossibility of accessing public markets in emerging countries or the “Buy Chinese”, our major competitors reserve public procurement for their national companies. An indisputable and unavoidable lever for growth, public procurement represents, with 2,000 billion euros per year, nearly 14% of the European Union’s GDP. In 2020, companies from third countries benefited from European public procurement for 50 billion euros, without compensation for European companies. It was time to restore the balance. With the agreement reached on the new instrument on reciprocity, a non-European company taking part in a public contract in the EU may be excluded or face a penalty of up to 100% of the amount of the public contract if this company has origin a country closed to European companies.

Coercion, a threat to be countered. Let’s be very clear about the state of the world, economic coercion is now commonplace: whether with US extraterritorial sanctions or China’s unilateral behavior contrary to international law towards Lithuania or Australia, the era of the confrontation is on. To be audible and credible, the European Union must quickly equip itself with an instrument aimed at combating coercive measures to prevent third States from putting pressure on our economies and our models of society. How? ‘Or’ What ? By strengthening the Union’s tools to fight against abuses and practices aimed at restricting our strategic commercial choices, and therefore our freedom of action in defiance of the most elementary international law. Let’s be ambitious, the proposal currently on the negotiating table at European level is interesting. The temptations to weaken certain European states by third countries must be stopped.

Standards, a strategic business asset. Another subject of international concern for businesses is that of the excessive weight held by non-European economic interests in Community standardization policy. It is fundamental to give European companies control over the production of our own technical references, especially since the new European industrial policy now aims to invest massively in key technologies: digital, energy transition, data or even cybersecurity. On these subjects, Thierry Breton’s recent declarations are positive and go in the direction of strengthening a more “autonomous” European standardization, at least without the risk of the presence of a dominant extra-European interest. These orientations must be followed by effect.

The means, a strengthening of the role of the “commercial prosecutor”. Created in July 2020, the function of “chief trade enforcement officer” aims on the one hand to help our exporters to fully benefit from the advantages of our trade agreements and on the other hand to strengthen the application of commitments in terms of sustainable development. . The French Denis Redonnet, who fulfills this function, must be provided with the human resources and the legislative levers essential to fulfill his mission. Europe must make its “enforcement” procedures more effective, as our major competitors are doing. In any international agreement, the implementation and respect of commitments remain the key, it is a simple question of balance and trust, and public opinion is increasingly sensitive to this. This is particularly true in environmental matters: the reform of the sustainable development chapters in trade agreements must ensure that any serious violation of environmental and social commitments can be sanctioned, except to empty all agreements of their substance. So to distort the game of competition and go against the objectives of the fight against global warming by accelerating relocations and CO2 leaks. It’s the same subject for the carbon border adjustment mechanism, another major priority of the French Presidency. Let’s give ourselves the means to enforce the balance in our international agreements, whether legal or financial compensation at the borders.

Today, the question for the European Union is not to withdraw into oneself, far from it. There will be no strategic autonomy without openness. The new European trade policy must succeed in creating the conditions for openness, while ensuring respect for the balances necessary for the proper exercise of world trade. The challenge is to sustain this newly reaffirmed ability to act together and coherently.

Alain di Crescenzo is president of CCI France. Marie-Pierre Vedrenne is a Member of the European Parliament, Vice-President of the Committee on International Trade and a member of the Committee on Employment and Social Affairs of the European Parliament.

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