Chairman Lange, Honourable members,
While we now work together to deal with the terrible war in Ukraine, I am pleased to have this opportunity to engage with you.
The active involvement of the INTA committee is fundamental for the EU trade agenda and its success.
This is a good moment to pause, and take stock.
We are half-way through the current mandate.
Just over 12 months ago, I presented the new EU trade strategy to you.
I explained its genesis, noting that the world of trade is changing fast.
I highlighted escalating global tensions.
I pointed out an increasing tendency among certain players to weaponise trade policy for geopolitical purposes.
12 months later, this has regrettably been borne out. The Ukraine war is the worst possible manifestation of the global resurgence of raw power politics.
Geopolitical shifts are accelerating.
A clash of values is taking place in our neighbourhood, and on the global stage:
On one side stand those who believe in democracy, the right to self-determination, rule of law, and respect for international agreements.
On the other side stand those who believe in brute force.
In this world, we have to be more assertive. We have to stand up for our values.
We see the same tensions reflected in global trade.
Rules and values versus brute force.
Open and fair trade versus mercantilist power plays.
The weaponisation of trade shows no signs of abating.
We have no choice but to face up to this reality, and adapt.
That is why we launched the new Anti-coercion tool last year. We need to have the means to defend our legitimate interests and values, in full respect of multilateral rules.
The challenging situation in Lithuania proves this need in a very real and worrying way.
We need to ensure that our trade policy is geopolitically agile, while also serving our wider goals.
One year ago, I argued that our citizens expect trade policy to do more to support our top-line ambitions, like the green and digital transitions.
I think we can say with confidence that, yes, our trade policy is indeed evolving.
Let me illustrate what I mean.
The Commission Work Programme for this year places a great focus on the Green and Digital transitions.
We promised that trade policy would play a greater role, and we are delivering on that promise.
Already, we have sponsored 3 climate initiatives at the W.T.O. This follows through on the commitments I made to you in my hearing to become Trade Commissioner.
We made a proposal to combat deforestation.
We launched our proposal for a Carbon Border Adjustment Mechanism. This is now before the European Parliament for your scrutiny.
And we have just published a proposal on Sustainable Corporate Due Diligence.
On the digital side, we continue to pursue e-commerce negotiations at the W.T.O.
And we are pursuing digital partnership agreements with trade partners around the world.
These are welcome developments. They will help the EU.
Openness continues to be the means by which we express our global leadership.
It is our leverage for getting results.
We have a Green Deal, with ambitious binding targets.
But an ambitious climate plan at home is not enough.
Real change can only happen when we also encourage our global partners to change.
This is where the true strength of our global network of trade deals comes into play.
By engaging with our partners, by re-affirming our openness, we achieve results.
Trade in green technology helps to create jobs and lower emission levels all over the world. Trade agreements eliminate barriers and make green goods more affordable.
And we are taking every step to ensure that the Sustainable Development Chapters in our trade deals deliver good outcomes.
Already, we have seen noteworthy positive outcomes on labour rights, arising from bilateral deals.
Because when our partners sign trade deals with us, they commit to implementing internationally recognised core labour standards.
They agree to make continued and sustained efforts to ratify fundamental I.L.O Conventions if they have not yet done so.
This has led to positive achievements such as:
- The ratification of 3 I.L.O conventions in Korea;
- a new Labour Code in Vietnam reflecting the ratification of I.L.O Conventions; and
- new labour inspection laws in Georgia.
However, we are mindful of the fact that TSD chapters have the potential to do more, particularly on climate and sustainability outcomes.
This is why we are carrying out a detailed review of the 15-Point TSD Action Plan and enforcement of trade agreements.
The public consultation closed in November 2021, and we have published its outcomes online.
Two weeks ago, we published the report comparing different TSD approaches around the world.
Building on this very good basis, in the next months we will work with the European Parliament, Member States and all stakeholders to see where we can strengthen our approach.
It is important to have in-depth discussions, and hear different views and perspectives, to make sure that we get it right.
But let me be clear: we will not compromise on openness. In fact, openness is the key to getting good results, including on TSD.
We have heard a lot about strategic dependencies.
Some people believe we should roll back on openness in order to guarantee access to certain raw materials.
But the facts do not support this argument.
Yes, there have been supply chain challenges in recent years.
Yes, we experienced supply and demand imbalances in some specific sectors.
Disruptions notably arose for semiconductors and certain raw materials.
Yet in fact, trade openness was key in expanding the range of alternative sources of supply.
So we should not make hasty assumptions about the nature of this problem. In this context, the Commission has carried out a “bottom-up analysis” based on trade data.
It showed that out of 5,200 products imported into the EU, there are only 137 products for which the EU is highly dependent. This represents 6% of the total value of imported goods.
Of this group, 34 products representing just 0.6% of the total value of imported goods are potentially more vulnerable.
And for most of these products, industry itself is best placed to reduce dependencies, for example, through diversification of suppliers.
It is important that policy solutions are specific, and proportionate.
Well-known challenges in specific sectors should not be used as justification for public interventions across the economy.
Instead, we should focus our attention and resources on areas of strategic importance.
Our position is clear: we believe that EU competitiveness depends on continued integration in the global economy.
Moreover, the EU gains resilience from world markets being open.
We want to establish and pursue strong international relationships, in particular with like-minded partners.
That is why I look forward to the next meeting of the EU-U.S. Trade and Technology Council in May. The TTC is providing exciting new avenues for transatlantic leadership and standard-setting.
That is why we continue to pursue new agreements with global partners, such as Australia and New Zealand.
At the same time, when opportunities to diversify are limited, we should be ready to act autonomously.
Building our own capacity in specific strategic areas will improve our resilience.
Our large network of trade agreements helps to diversify our sources of supply.
But, dear colleagues, we should never lose sight of the number one purpose of trade: to create jobs and prosperity for our people.
From this perspective, the facts are very clear:
Europe remains the world’s number one trading bloc.
Our trade in goods and services represents 16.8% of global trade. This is notably higher than our share of world GDP, which stands at 15%.
And it is striking how our trade performance remained resilient.
Our share of global GDP has decreased from 16.3% to 15% since 2010.
Yet our share of global trade has only decreased by 0.1 percentage points in the same period, from 16.9% to 16.8%.
These facts are worth repeating, because it is sometimes forgotten how much Europe benefits from open, fair and rules-based trade.
The EU is the number one trading partner for 74 countries around the world, compared with 64 for U.S. and China.
The EU is the world’s number one investor, and the second most attractive destination for investments, after the U.S.
These are fundamental pillars of our economic performance.
And 85% of global GDP growth will happen outside the EU in the next 5 years.
We need to connect to this growth, giving our companies every opportunity to grow, innovate, and create the jobs that will drive the green and digital transitions.
Exports support 38 million EU jobs, up by 11 million since 2010.
This represents growth of 42%. Over the same period, total employment in the EU grew by only 6%.
Open trade, and an open approach to solving global problems, is serving Europe well.
Of course, openness must be underpinned by appropriate global rules, notably at WTO level. Therefore, we continue to work towards substantive outcomes at MC12, which will take place in June.
We are focusing on four priority areas: trade & health, fisheries, WTO reform & agriculture.
So, in summary, we must work together to maintain and build on this winning approach.
I look forward to hearing your comments, and I look forward to working closely with you to advance our open, sustainable and assertive EU trade agenda.
Thank you.