EU Trade Policy

Boom of Bilateral Agreements caused by

- after 1995, multilateral negotiations are not progressing - agreements between 164 countries are complicated - more issues than j tariffs, environment and labour standard -coalitions divide

Open Strategic Autonomy

- always committed to open and fair trade -aware of the need to reduce dependce

EU-Korea FTA

- negotians launched in 2007 and fully operational since 2014 - most comprehensive FTA ever negotiated by the EU - import duties are to be eliminated on nearly all products - liberalization of trade in services

National Security Exception

- provides a way for governments to take any tariff action if views for national secutiry - pandoras box w high potential for abuse

Why arent bilateral agreements not the perfect substitute>

- unilateral bargaining power matters - causes negative trade diversion - increases complexity of trade

Gravity Model

1. SIZE the bigger the gdp of the countries involved in a bilateral traidng relationship, the more they trade 2. DISTANCE the farther away the smaller the volume of trade

Four Drivers that triggered new phase of trade strategy in the EU

1. WTO got stuck 2. Trump thought trading system was flawed 3. China joined WTO in 2001, but liberalization did not happen 4. Covid 19 trade is not flowing like it did

WTO Serves as a

1. negotiating forum 2. resolution mechanism for trade disputes

2 Main dimensions of EU bilateral agreements

1. neighborhood dimension, strengthens the eu trade and political relations with the ring of friends (mostly with Association agreements) 2. Global partner promoting peace, security, development (Cooperation agreements)

Two conditions for preferential bilateral agreements

1. tariffs and other trade barriers should be reduced or removed on substantially all sectors 2. countries that are not part of the agreement should not find trade more restrictive than before

Six policy areas of new EU strategy

1.Reform the WTO: eg, restoring a fully-functioning WTO dispute settlement with a reformed Appellate Body. 2.Support the green transition and promote responsible and sustainable value chains: eg, the Carbon Border Adjustment Mechanism (CBAM) as an autonomous measure. 3.Support the digital transition and trade in services: eg, pushing WTO agreement on digital trade including rules on data flow and privacy. 4.Strengthen the EU's regulatory impact by 'exporting' EU standard at an international level. 5.Strengthen the EU's partnerships with neighbouring, enlargement countries (Western Balkans) and Africa. 6.Strengthen the EU's focus on implementation and enforcement of trade agreements, and ensure a level playing field. It is therefore important to create the conditions for the ratification of agreements with Mercosur and Mexico, and to conclude ongoing negotiations, in particular with Chile, Australia, and New Zealand, which are well on track.

Cotonou Agreement

An agreement negotiated in 2000 to make the EU's relationship with associate ACP (African, Caribbean, Pacific) states more compatible with WTO rules.

Countries with which EU has signed CU agreements

Andorra, San Marino, Turkey

Enlarged Single Market

EEA, norway, iceland, liechtenstein and eu swiss bilateral accords

hub-and-spoke system

EU is a hub for a number of trade deals, each partner is negligible for the EU As a whole

consensus (wto)

In the WTO nothing gets decided unless there is consensus

Non-discrimination (WTO)

National treatment. "A WTO member must treat foreign products, services, and service suppliers not less favorably than it treats 'like' domestic products, services, and service providers"

Council must adopt any agreement

Negotiated by the Commission after the Parliament has give its consent

Dumping

Selling goods in another country below market prices

Balkans

Stabilization and Assocaiton agreements, Albania, North Macedonia and Serbia, and Montenegro are candidates

Anti-dumping duties

Taxes (tariffs) that bring the import price of the good that is being dumped closer to the price charged by domestic firms in order to avoid injury to the domestic industry in the importing country.

most favored nation

Trade status granting a nation the same trading privileges as other nations.

Single undertaking (wto)

Under WTO rules, there is a requirement for members to accept or reject the outcome of multiple multilateral negotiations as one package of reforms, rather than only choosing those parts with which they are most happy.

Reciprocity (WTO)

Wto members have symmetric mights and obligations

Footwear case

anti-dumping, EU commission investigation found evident state intervention, EU implemented higher duties on china and vietnam

MFN tariffs

are the highest that WTO members charge, by default to eachother

Euro-Med Association Agreements

asymmetric bilateral FTAs, since eu cuts tariffs faster than partners

Countries EU signed FTA agreements with

balkan states and other European states, Mexico, South Africa, Chile, Korea, Colombia and Peru, Canada, Japan, Singapore

Subsidies

can give favorable treatment to speciifc firms, makes competition unfair

Combined Nomenclature (CN)

determined rate of customs duty and good are classified

Reciprocity has a

dynamic understanding, more about change

countervailing duties

government tariffs to offset suspected subsidies provided by foreign governments to their producers

European Commission

has the task of negotiating trade matters with third nations on behalf of the Member States, right of initiative, supervises implementation

Harmonized System nomenclature

international classification that CN is based on

European Parliament

is co legislator with the Council on all basic EU trade legislation

Tariff bindings (wto)

once a tariff reduction ahs been negotiated and accepted, it becomes bound at the negotiated rate

Deep and Comprehensive Free Trade Area

recent development, involve FDI, Services, IP protection

GSP (Generalized System of Preferences)

rich states give trade concessions to poor ones to help their economic development, GSP+ for countries which implement international agreements, Everything but arms for LDCs

global value chains

sets of linked operations that organize the production of any particular product

Council and Parliament

sets specific mandates for which the Commision to negoitate in accordance with

Tariff Peaks

some pro ducts have relatively high tariffs amidst generally terrif levels