Trade

EU takes over global trade stage

The international trading system created by the U.S. after the Second World War has a new leader — the European Union.

The EU on Friday announced the conclusion of a landmark trade agreement with Japan — covering economies worth about 30 percent of the world’s GDP. That comes after scoring a trade deal with Vietnam in 2015 and Canada last year.

As Trade Commissioner Cecilia Malmström said Thursday in an interview with POLITICO on a potential deal with the Mercosur bloc of South American countries, “only in tariffs we will be saving … billions!”

The EU is opening up one market after another to its exporters, slashing tariffs and aligning standards for products like cars, food and medicine patents.

And Japan isn’t the last deal to be had.

Malmström is also closing in on a trade deal with the Mercosur bloc, which will be four times bigger than the deal with Japan in terms of trade volumes. The news about the Japan deal will add pressure on Mercosur to finalize the agreement. Trade talks with Mexico and Australia are also under way.

The chain of trade victories is important for another reason: As it strikes deal after deal, the EU is also shaping world standards at a speed that may leave the U.S. lagging.

For example, Europe’s system of protecting the names of gourmet foods, so-called geographical indications, is taking over a wider swath of the globe. With every trade deal signed with the EU, more and more countries subscribe to the principle that Champagne can only come from the Champagne region in France and Parmigiano Reggiano can only come from Northern Italy. As Malmström noted Friday, the Japan deal “ensures the protection in Japan of more than 200” such European foods.

The accord with Tokyo also means Japan will follow the same car standards as the EU, meaning cars don’t have to be tested twice when sold in each other’s markets, making life easier for exporters.

EU-linked trade agreements are piling up at the same time the U.S. is retreating from the world stage. U.S. President Donald Trump’s decisions to withdraw from the Trans-Pacific Partnership, renegotiate the North American Free Trade Agreement, and to block the World Trade Organization’s dispute settlement system, along with his threats to hit China with tariffs, have raised the risks of a global trade war, for which there is little appetite elsewhere.

That leaves the EU as the indispensable partner for world trade — something ardent Brexiteers will find difficult to accept.

The Japan deal came on the same day that Commission President Jean-Claude Juncker announced a breakthrough in Brexit talks. A key to that was a significant British concession: In the absence of any trade deal that guarantees the same — the U.K. will unilaterally “maintain full alignment with those rules of the Internal Market and the Customs Union” which prevent the need for customs checks between the Republic of Ireland and the United Kingdom. This weakens the U.K.’s negotiating position, as the EU now has this guarantee as a fallback.

Malmström’s announcement Friday was also a clear signal to the U.K. of what it will miss out on once it leaves the EU.

When asked whether the U.K. would be able to remain in the trade agreement with Japan, she replied: “The very day that the U.K. leaves the European Union, it also leaves all the trade agreements that we have with third countries.”

Original Article

Politico

The post EU takes over global trade stage appeared first on News Wire Now.

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  131. Once I originally commented I clicked the -Notify me when new feedback are added- checkbox and now each time a comment is added I get 4 emails with the identical comment. Is there any method you’ll be able to take away me from that service? Thanks!

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  191. Today, I went to the beach with my children. I found a sea shell and gave it to my 4 year old daughter and said “You can hear the ocean if you put this to your ear.” She put the shell to her ear and screamed. There was a hermit crab inside and it pinched her ear. She never wants to go back! LoL I know this is completely off topic but I had to tell someone!

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