The European Union will act against any country that denies it access to scarce raw materials or energy resources it needs for growth, according to a draft document setting out its 10-year trade agenda, aims that could ratchet up tension with China and Russia.
EU wants Doha trade deal secured during 2011 Policy goals contained in the EU's 2020 trade strategy, set to be unveiled by EU trade chief Karel De Gucht next month, lay out Europe's determination to use legal and political muscle to open access to raw materials and break down market barriers that it fears could hamper EU industries' efforts to globalise.
Europe will push for the completion of global trade rules at the World Trade Organisation by the end of 2011; push for more trade in services and environmental technology; develop its high-tech sectors; pursue counterfeiters and close free-trade deals with countries covering half the EU's external trade, according to a draft obtained by Reuters. "We need to seize the opportunity for higher levels of growth abroad, especially in South and East Asia," says the 21-page document that sets out major target markets.
Among other aims, the EU plans to focus on restrictions on exports of raw materials and state subsidies by countries such as Russia and China, launching legal action at the World Trade Organisation and rolling out the EU's own legal arsenal. "We will use current trade rules to the maximum, pursue the establishment of a monitoring mechanism of export restrictions and push for international rules.
"The sustainable and unrestricted supply of raw materials and energy is of strategic importance for the competitiveness of the EU economy... A number of governments outside the EU are developing industrial policies that create supply bottlenecks and other distortions," says the document
China has denied reports it plans to cut export quotas on rare earths, but dwindling supplies of the minerals used in the production of high-tech goods from TV screens to wind turbines have triggered alarm around the world. EU efforts to tap China's booming markets have been thwarted by "insufficient enforcement of (intellectual property rights), an opaque standardisation system, burdensome certification procedures and industrial policy measures aimed at import substitution, forced transfer of technology and granting local producers preferential access to raw materials," the paper says, warning the EU will take WTO action to remove such barriers.
Countries that subsidise strategic sectors will also be subject to EU penalties such as protective tariffs according to the plans, a direct reference to China whose subsidy schemes the EU has begun to challenge this year. Europe's last trade strategy goals, published in 2006, highlighted the need for European firms to globalise.
The new goals aim more at using legal and political force to open access to the goods and markets of China, India, Brazil, Japan, Russia, the United States and other major trade partners. European production should focus on innovative, high-tech and environmental goods and services, and Europe will push for international tariff breaks for electronic goods and services and those that help fight climate change, the strategy says. But it will warn off countries such as France that have been pushing for green border taxes on goods produced in countries with less stringent environmental laws than the EU.
"The Commission remains of the opinion that the option of border adjustment measures raises a number of concerns." The strategy foresees boosting funds for retraining EU workers for more high-skilled jobs, with a focus on EU farmers. Next year will see the publication of several specific strategy goals, among them recommendations on using trade as a tool for development by implementing preferential tariff regimes for poor and crisis-hit states such as Pakistan.
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