Trade Policy

BACKGROUND

EU trade policy is the common policy of the European Union in relation to agreements with states on matters linked to tariffs, market access and trade-related policies such as public procurement or competition. Since the blockage of the WTO Doha Development Round, the EU and its trading partners have embarked on a plethora of bilateral and bi-regional trade agreements, or wider association or cooperation agreements including trade agreements. In addition to bilateral agreements, the EU also counts with unilateral trade policy instruments (e.g. Generalised System of Preferences, currently being revised). The EU is also party to plurilateral trade agreements, such as the WTO Government Procurement Agreement (GPA) and is an active partner of the negotiation of a future Environmental Goods Agreement (EGA).

The current EU trade strategy ‘Trade For All’ of 2015 (new EU trade policy strategy expected to be published on 17 February 2021) attempted at having a more responsible trade policy based on EU values. It included some voluntary actions to promote responsible management of supply chains and to promote the uptake of fair and ethical trade schemes (section 4.2.4), building on the recognition in a 2009 policy document of the role of Fair Trade and other trade-related sustainability schemes to sustainable development. In 2018, after consultation with Member States and stakeholders, the EC adopted a 15-point plan to make EU trade and sustainable development chapters more effective ¨for which a consensus has emerged¨.


WHAT ARE THE FTAO’S VIEWS?

Despite the small improvements of the above-mentioned “Trade for All” strategy and 15-point plan, EU trade policy remains mainly targeted as a tool to open markets for EU companies abroad, guarantee cheap low-added value inputs access to the EU, while offering protection to some sectors, like EU farming and the agri-food industry, which typically benefit large economic actors over small EU farmers. For example, the EU-Mercosur agreement, not yet ratified, is an example of the insufficient strength of sustainable development and climate action commitments in EU trade agreements, which are relegated to weak “Trade and Sustainable Development” chapters. FTAO supports climate change and sustainable development commitments becoming “essential clauses” of EU trade agreements.

The inclusion of a ¨fair and ethical trade¨ section in the ‘Trade For All’ strategy was a step in the right direction and FTAO strongly supports the proposal by the European Parliament Fair Trade Working Group on the need for a dedicated Fair Trade section in the next EU trade strategy. However, promoting the uptake of bottom-up good practices is far from enough.

The FTAO welcomes the introduction in November 2020 of a new complaint mechanism which, through a complaints form, allows civil society and other actors to inform the lack of compliance of sustainability and human rights commitments. The FTAO looks forward to actively contributing to the upcoming revision of the above-mentioned GSP scheme and of the 15-action plan in 2021, with the aim that EU trade policy truly becomes an instrument to achieve EU´s sustainable development and climate action commitments.


FURTHER READING

Non-paper about strengthening the Domestic Advisory Groups

FTAO’s submission to the Consultation on the Trade Policy Review

From local to EU level: Scaling Up Fair Trade in Europe, FTAO

Trade: Time for a new vision: The Alternative Trade Mandate (FTAO & Other CSOs)

Setting course for sustainable trade (Friends of the Earth Europe)

Non-paper from the Netherlands and France on trade, social economic effects and sustainable development

 


Find out more on our work and views on other EU policies (such as on Sustainable Corporate Governance & Human Rights and Environment Due Diligence) here.