MNI INTERVIEW: EU Lacks Focus For Trade Deals - EP's Winkler

The surprise failure of talks for an EU-Australia Free Trade Agreement should be a wake-up call for European Commission which has lost its focus on securing trade deals, the Vice-Chair of the European Parliament’s International Trade Committee told MNI, pointing to the need for a dedicated trade commissioner.

A tough position from Agriculture Commissioner Janusz Wojciechowski, who had taken flak over surging Ukraine grain imports into Eastern Europe, and the failure to appoint a dedicated trade commissioner following the resignation of Phil Hogan in 2019 were factors behind the setback, Iuliu Winkler said in an interview.

The Commission has blamed Australia for going back on an earlier agreement on farm quotas, an accusation rejected by Australia.

“Our whole economic security strategy is based on international cooperation so if we don’t find the global partners for that we will be in a very difficult position,” said Winkler, noting that the EU depends on international partners to implement policies such as its recently-announced Carbon Border Adjustment Mechanism, which would penalise imports from carbon-intensive producers.

The Australia deal was also aligned with the European Commission’s economic security strategy, aiming to free the bloc from over-dependence on undemocratic partners like China and Russia while ensuring access to critical raw materials vital for the green and digital transitions.

The trade role was assumed by Commission Executive Vice President Valdis Dombrovskis along with his existing job of commissioner for an economy that work’, a solution that Winkler thinks led to a lack of focus on trade.

LACK OF FLEXIBILITY

But Winkler suspects that the ultimate cause of failure was a lack of flexibility in the Commission’s negotiating mandate.

“If you look at the difference [between the EU and Australia] it is of symbolic value not financial value,” he said, “symbolism has to be resolved by political tools.”

By the end of the EU institutions’ mandate next summer, the Commission looks likely to have agreed just one new FTA, that with New Zealand, which should be ratified by the European Parliament this month. The last FTA was that agreed with Vietnam under the last Commission and ratified by the current EP in early 2020.

The New Zealand deal, with commitments on gender equality, sustainable development and tackling climate change, raised unreal expectations that the EU could do similar deals with other, bigger economies, Winkler said.

“New Zealand is a small-dimension economy and far from the sophistication of the EU economy … Imagine talking to India about the New Zealand deal, they would laugh in your face.”

The EU is also currently negotiating deals with India, Indonesia and Thailand among others, and Spain, which holds the EU’s rotating presidency even hopes to revive and finalise the stalled negotiations with Mercosur trade which have been going since 2000.