TRADE POLICY REVIEW:
Concluding remarks by the Chairperson
- Trade Policy Review: European Union
The thirteenth Trade Policy Review of the European Union has offered us a good opportunity to deepen our understanding of the trade, economic, and investment policies of the EU which remains the biggest trader of goods and services in the world and one of the most important members of the WTO and the multilateral trading system. Well over 1,000 questions were submitted to the EU before the meeting from 38 Members and over 50 delegations intervened, which itself underlines the importance attached to the EU's trade and investment policies and practices. Just as it was in the last Review in 2015, the EU remains of crucial significance to world trade; it is the second largest exporter and importer of goods, the largest trader of services and ranks first in both inbound and outbound investment.
I would like to thank the EU delegation, led by Deputy Director-General Joost Korte, our discussant Ambassador Roberto Zapata Barradas of Mexico and all the delegations that took the floor for their valuable contributions to this Review.
The EU is a major trading block not just because it is a big market of over 500 million people but also because it has an open and transparent trade and investment regime. Members appreciated that the EU, as a large open economy, continues to play a crucial role in the global economy and international trade. As Mr Korte pointed out in his opening statement, the EU remains firmly committed to the multilateral trading system and the principles which the WTO represents. Members commended the EU for its continued efforts to advance negotiations inter alia on agriculture, disciplines on fisheries subsidies, environmental goods, and trade in services.
It was also noted that the EU faces several internal problems. As stated by the EU on the first day, the euro crisis may be over and unemployment falling. However, the economic recovery across the EU is weak in general and uneven among the Member States. At the same time the international trading community faces many uncertainties - notably over Brexit, which will have implications for the EU's trading partners and the EU’s WTO Schedule of Commitments. In this regard, Members expected that any process to make adjustments to the Schedule of the EU as a result of Brexit would be open, transparent, WTO-compliant, and include consultations with third countries.
Nevertheless, despite internal problems and global uncertainty, the EU has not retreated from trade, nor has it introduced new policies intended to restrict trade. Instead it has continued to pursue trade liberalization through bilateral free trade agreements while continuing to provide non-reciprocal preferential access for developing countries under the EBA, GSP, and GSP-plus schemes. Furthermore, during the review period, the EU contributed to the successful expansion of the Information Technology Agreement, and is constructively engaged in the Environmental Goods Agreement and the plurilateral Trade in Services (TISA) negotiations.
Members welcomed the EU’s commitment to, and active participation in the WTO, including its efforts to make a success of the 11th WTO Ministerial Conference which will take place this December in Buenos Aires.
Members appreciated that, since the previous Review in 2015, the EU has undertaken several initiatives aimed at facilitating trade, including: its ratification of the Trade Facilitation Agreement; and the entry into force of the Union Customs Code to simplify and modernize customs procedures which includes the use of improved technology to facilitate trade.
Several delegations also noted that they were following with interest several new developments including; implementation of the new trade and investment policy initiatives in the Trade For All strategy of October 2015; the digital single market strategy; the e‑commerce package; and the implications of the ruling by the Court of Justice of the EU on competence relating to the EU-Singapore Free Trade Agreement. In addition, the importance of labour mobility and mutual recognition of qualifications were noted as well as the reform of financial services and the liberalization of railways and of port services.
Of course, not all the EU’s policies are seen as positive. In particular, many Members noted that agriculture remains an exception to the overall openness of the EU's trade regime. They expressed concern that the EU retains many complex and prohibitive tariffs on highly-traded products, such as agricultural products, fish, and some textiles. High tariffs, tariff escalation, non-ad valorem tariffs, and the many tariff quotas with high out-of-quota duties continue to be significant import barriers. At the same time, while some Members were concerned about the EU's approach to domestic support in the agricultural sector, they commended recent reforms of the Common Agricultural Policy towards less trade-distortive measures and fewer payments linked to production. However, they remain concerned about the total value of support, voluntary coupled support in all-but-one member State, and the absence of market access reform. Furthermore, while praising the EU’s role in getting an agreement on the elimination of export subsidies in MC10, they noted that the EU has yet to modify its Schedule to reflect the agreement.
Members were encouraged by reforms in fisheries policies and they urged the EU to increase transparency and take further steps to reduce support for fisheries, while welcoming the engagement of the EU in the negotiations on fisheries subsidies in line with the sustainable development goal target.
Members also raised concerns about the use of trade remedy actions and the trade impact of steel surveillance measures taken by the EU, and encouraged the EU to take such measures in accordance with WTO disciplines under its new regulations.
Recognizing the importance of protecting human, animal and plant health as well as the environment, some Members stated that a number of sanitary and phytosanitary measures in the EU are not based on objective criteria offered by scientific assessments of risk as required under the WTO SPS Agreement. In this regard, mention was made inter alia of: the EU's proposed regulations on endocrine disruptors; current maximum residue limits; and delays in the EU's authorization process for genetically modified products.
Other points that were raised several times in Members' interventions included the need for more information from the EU on the public procurement market, the investment regime, the concept of the multilateral investment court, geographical indications, the EU's actions on climate change, as well as various TBT issues including aspects of the REACH initiative.
In conclusion, Members welcomed the EU’s commitment to the multilateral trading system and appreciated that the EU remains open to trade and investment. However, several concerns remain, some of which have been raised in previous Trade Policy Reviews, such as agricultural policies, SPS and TBT measures, and the use of trade remedies. Furthermore, new issues that have arisen over the past two years, such as Brexit, should be addressed, recognizing that many WTO Members outside the EU are interested and will be affected by the results.
I hope that the EU delegation will take into account and further reflect on the many constructive comments, both broad and detailed, that it has received during this Review. Finally, I would like to thank all those that participated in our discussion, and I look forward to getting the answers to any outstanding questions within the next month, at which point the Review will be successfully concluded.