Wednesday 20 January 2010

Karel De Gucht on international trade – with comments

The Summary of hearing of Karel de Gucht – Trade (12 January 2010) published by the European Parliament mentions most of the big issues facing the future trade Commissioner and the common commercial policy of the European Union, but the answers as summarised give little away.

Let us turn to the written answers sent by the Commissioner-designate Karel De Gucht to the Committee on International Trade of the European Parliament ahead of the hearing (7 pages).

De Gucht welcomed the strengthened role of the European Parliament under the Lisbon Treaty, as reinforcing the democratic legitimacy, effectiveness and transparency of the EU’s trade policy. The EP should have all the information needed to play its enhanced role. He promised that the EP will be informed and have an opportunity to express its views and make recommendations on major developments at all stages of trade negotiations (pages 4 and 5).

De Gucht stated his commitment to open markets backed up by rules-based international trading system, when he laid out his three priorities for the future Commission term (page 5-6):

1) A rapid conclusion of the Doha Development Agenda (DDA) would boost the global economy and create jobs. It would also prevent a protectionist spiral.

2) Bilateral and regional trade relationships are needed to complement the multilateral system, because key issues such as investment, public procurement, competition, intellectual property and other regulatory questions are currently insufficiently covered by the World Trade Organization (WTO).

3) Ensuring that trade policy works for people, in the EU and elsewhere, especially in developing countries. As an integral part of the Commission’s EU 2020 vision, trade policy must be at the service of broader policy goals, delivering results for citizens. In addition to economic benefits, trade policy can promote European values such as human rights, social justice and the protection of the environment.

Trade is an EU policy area with little legislation, but trade agreements with third countries and within the WTO framework, said De Gucht who mentioned several ongoing negotiations for free trade agreements (FTAs); page 7:

• Korea
• Andean Community: Peru and Colombia
• Central-America (perhaps)
• Iraq (partnership and cooperation agreement)
• A number of economic partnership agreements during 2010

Legislative proposals:

• EU rules on certainty for foreign investors
• An implementing Regulation on safeguard measures in relation to the FTA with Korea
• Review and renewal of the Generalised System of Preferences (GSP)
• Updating the trade defence measures


Well-rounded replies reveal little about the crucial issues and the choices to be made between different interests. We turn to some additional viewpoints and oral answers presented on blogs and other media in order to find potentially divisive issues.

Latin America

The blog IP tango reports that in trade discussions with Mercosur the sensitive issues reamin the same: for Mercosur some industries, services and also intellectual property, and for the EU agriculture.

With regard to the nations of Isthmus (Belize, Guatemala, Honduras, Costa Rica, El Salvador, Nicaragua and Panamá), IP tango notes that negotiations had already started, but were suspended after the coup in Honduras (June 2009). An offer has been presented by the Isthmus nations, but the EU has not replied. See: The EU meeting with Latin America: will be May the month to see Association Agreements between the two? (19 January 2010).


Indian and European negotiators will focus on whittling down differences over market access and intellectual property rights when they meet next week to push for a bilateral trade pact, reports the International Business Times: India, EU to focus on trade deal hurdles next week (19 January 2010). Problematic issues include sensitive issues like climate change and child labour, inclusion of public procurement, costly certificates for fruit exports to the EU, conformity procedures for the EU mark, and patent protection (including generic drugs).


Roddy Thomson for AFP reported on De Gucht’s comment on a “deliberate” policy by China to keep its currency undervalued, a “major problem” for global economic recovery: Incoming EU trade chief lashes out at China (12 January 2010).

Big business: Boon or bane?

European economic and business interests are an ideologically divisive issue. Some see corporate lobbying as a danger for higher European values in the world. Others perceive that external trade lies at the heart of promotion of our economic interests and the pursuit of prosperity, and judge the EU’s role accordingly.

Here are samples of both approaches.

On the Brussels Sunshine blog dedicated to more transparent lobbying, Pia Eberhardt commented on what she saw as De Gucht’s evasive answers and doubtful record on promoting the interests of big business above civil society: De Gucht on shaky ground on corporate lobbying (13 January 2010).

Global Issues picked up the same arguments, seeing Karel De Gucht, the incoming commissioner for external trade, as a champion of the interests of multinational companies: Europe: Shadow Falls Over New Leaders (18 January 2010).

From a viewpoint favourable to free trade, Tony Barber on the FT Brussels blog saw Karel De Gucht’s EP hearing performance as the best one that far, when he wasn’t afraid to speak frankly about his opposition to a carbon border tax, a policy favoured among others by French President Nicolas Sarkozy: [Untitled] (13 January 2010).

Blogger and international trade attorney Scott Lincicome hailed 12 January 2010 as A Great Day in the Fight Against Green Protectionism, starting with the statement: The EU’s new trade chief sounds great. Not only does Karel de Gucht oppose carbon tariffs out of practical and trade war concerns, but he also advocates multilateral agreement to eliminate barriers to trade in environmental goods.

Toby Vogel on the European Voice gave De Gucht four stars for his conduct during the EP hearing: De Gucht gives strong performance (12 January 2010).

Through the free trade think-tank ECIPE, big business itself calls for A modern trade policy for the European Union (January 2010; 38 pages).


The common commercial policy is an exclusive competence of the European Union, and with the enhanced powers of the European Parliament at least some of the political choices are going to appear more frequently on our television and PC screens.

Ralf Grahn

J.K. Educate yourself and brush up your language skills by reading EU-related blogs. Coulisses de Bruxelles, written by the journalist Jean Quatremer for the French newspaper Libération is an essential source of information and opinions about EU politics, and many of the comments on the blog are both educated and readable.

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1 comment:

  1. Economies based on making money on money instead of making things are burning out. Consumers in the USA can no longer support the global economy. The unemployment rate is much higher than reported and the vast underemployed and working poor can not even afford to buy the cheaper imports.
    The coming balancing of all this is not going to be pretty. The impoverished workers of the world will be losing their jobs too.
    Federal Chairman Ben Bernanke actually summed up the whole condition during the first President Bush stimulus package when he told Congress the best way to stimulate the U.S. economy is to buy "domestically produced goods" and this is bring a post-globalization era - where real global trading is involved and not the facade of moving factories from place to place for the sake of the cheapest labor possible. Free trade was not really trade. See and


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