On 18 February, the European Commission presented its new Communication on Trade: An Open, Sustainable and Assertive Trade Policy. The communication outlines the EU’s trade strategy for the coming years. The CRM Alliance welcomes the EU’s more assertive approach on trade and efforts to ensure an unrestricted access to raw materials required for the EU green and digital transition.
Open Strategic Autonomy
As expected, the new trade policy builds on the principle of ‘Open Strategic Autonomy’ and aims to establish resilient and sustainable value chains. Although the communication does not contain any concrete actions in the field of critical raw materials, the Commission does recognize that the EU’s economy relies on imports to provide access to raw materials. The Commission will identify strategic dependencies in industrial ecosystems and enhance dialogue with third countries in strategic areas for EU competitiveness. The new trade policy will work towards ensuring a stable, rules-based and open trading system allowing the diversification of supply chains and an undisrupted access to critical supplies.
Sustainability at the heart of EU trade
While the concept of Open Strategic Autonomy might be the building block for the new trade policy, sustainability will be a defining pillar within the strategy. Trading partners will need to ratify and implement Multilateral Environmental Agreements on chemicals or waste, and adherence and commitment to the Paris Agreement will be an essential element in future trade an investment agreements. Additionally, the Commission will review its 15-point Action Plan to ensure the effective implementation and enforcement of the Trade and Sustainable Development Chapters (TSDs) in trade agreements. When it comes to establishing sustainable and responsible value chains, the Commission will soon publish a proposal on mandatory due diligence. The implementation of the Carbon Border Adjustment Mechanism should also ensure that EU climate policies can no longer be undermined by carbon leakage.
A more assertive approach
Besides taking a ‘green’ approach on trade, the EU will also become more assertive towards trading partners. The Commission will prioritize WTO reform and focus on the correct implementation and enforcement of free trade agreements. The EU will make better use of its trade toolbox – one of its most powerful tools for global influence – and is working on a legal framework to counter market distortions caused by unfair foreign subsidy tactics.
The CRM Alliance welcomes the Commission’s green and assertive approach on trade, especially when it comes to ensuring a secure access to raw materials and better protecting EU industries against unfair competition from the outside.