Let’s be realistic: for a less naive Europe in a globalized world
In the changing world economy, it is key for Europe to benefit from globalization, which represents an opportunity for its growth, jobs and competitiveness. In this context, Europe should be careful to avoid two pitfalls: one-sided openness and parochialism. It could set an example of well regulated globalization, based on shared game rules, thus ensuring an equal playing field for all.
The post-crisis world is a different world. The emergence of new players has changed the global wealth distribution.
The European Union has a number of cards to play. It is the world’s leading trade power with the highest level of openness and consequently the number one destination for foreign direct investment. It is in Europe’s interest to keep the world trading system open and fair and we should be the world’s promoter of free trade, which is key to economic growth and job creation but also to the elimination of global imbalances – a serious threat to the world economic stability. Deep and comprehensive multilateral agreements are essential to boost world economy and restore confidence in the international trading system after the crisis. Nearly 36 million jobs in the EU contribute to our trade performance. Yet we can only maintain and hone this competitive edge if we work together on building ways to more efficiently, firmly and strategically promote and defend our interests and common values.
This is a major issue: Europe’s credibility on the international scene depends on it, as does the longevity and development of our economies and societies.
The European Council meeting on 16 September 2010 set this new course. It agreed on the need for Europe to promote its interests and values more assertively and in a spirit of reciprocity and mutual benefit for Europe and its strategic partners. There are several ways in which we can put these principles into practice.
The European Union has a good tradition of international openness. The benefits of fostering open markets, trade and investment for our growth, jobs and the overall resilience of our economies are self-evident. Past experience has demonstrated that trade barriers are not a solution for economies that need, in priority, to improve their competitiveness and focus on high value added productions. Therefore, we remain committed to using this year’s window of opportunity to come to an ambitious, balanced and comprehensive conclusion of the Doha Development Round.
But we have to look beyond Doha. Our agenda has also to focus on market access for goods, services and investments, public procurement, protection of intellectual property, supply of natural resources and climate-related trade liberalization – just to name some of the main challenges.
On the subject of market access, to give an example, the EU has opened over 80% of its public procurement contracts to third countries, the other leading developed economies have opened less than 20% of theirs. And most of the emerging countries have made few or no commitment at all with the EU in this area. If Europe opens up its market to third countries, European firms should have access to those countries’ markets on equivalent terms, both for private orders and public procurement. It is quite simply a question of fair trading and it will enable Europeans to do more business.
Therefore, we would welcome ambitious procurement chapters in the bilateral and region-to-region free trade agreements that the EU is currently negotiating. It should guide our relations with all our developed and emerging partners, flanked by strategies tailored to each partner country’s actual development level.
To be more credible, Europe should increase its leverage to improve symmetry in the access to procurement markets. The next revision of public procurement procedures should allow for this. This rule should also apply at multilateral level, in the ongoing negotiations of the WTO Government Procurement Agreement.
Another field of action is the effective protection and enforcement of intellectual property rights, as well as State aid procedures. Can we be satisfied to see European firms purchased by firms from third countries with public support whereas our State aids are – rightly – strictly limited? Can we still accept that European firms face heavy restrictions to third countries markets, not least in the field of services, when Europe offers a non discriminatory access? Obviously not. Fair trading on a level playing field are basic rights and responsibilities.
It is our aim to promote and protect Europe’s strategic industrial and economic interests, to strengthen its cohesion and its place in globalization. Further efforts for market opening and monitoring of trade barriers and other restrictive measures hampering the free flow of goods, services and investment are necessary. It is also in our interest to define appropriate technology transfer conditions in order to maintain our technological assets. We therefore advocate a shared European approach based on best practices as the only way to maintain fair and undistorted competition. In the meantime, further efforts are to be made to increase the European innovation potential.
Yet it would be shamefully narrow-minded to ignore that the world and the international environment had changed. Europe needs to change its software. A Europe that shares, but denies parochialism, a realistic Europe that promotes and defends its interests while remaining faithful to its international outlook and developing its innovative capacity: such is the solid, active project we need to conduct to be equal to the global economic changes and meet the European people’s needs./.