Brussels, Jan 12 (DPA) The balance of world wealth is moving towards rising Asian powers such as India and China, and the European Union should adapt rather than trying to fight it, the bloc’s designated trade commissioner said Tuesday.
The EU is the world’s largest economic grouping, but it has not yet managed to convert that wealth into political influence, making European leaders keen to strengthen their international clout.
The EU’s trade policy should “mark… a shift to economically important markets, particularly in Asia, as well as a deeper level of integration with our neighbourhood,” Karel De Gucht told the European Parliament’s trade committee.
“India, Canada, Ukraine, Latin America, the (Mediterranean area) are likely to dominate our agenda over the next two years… together with upcoming talks with Singapore and the updating of our trade relationship with China,” De Gucht said.
In particular, he called for a “higher level” of cooperation with China on matters of trade and investment. China is the EU’s second largest trading partner.
One prerequisite for that to happen, however, would be a move by China to allow its currency to appreciate. EU leaders regularly complain that the renminbi is undervalued, hampering European efforts to export to China.
China “must show its responsibility by being able to address thorny questions (of trade), such as currency misalignment”, De Gucht said.
At the same time, he also called for closer commercial ties with the US, which is still the EU’s number one trading partner.
“With the US, the real challenge is not tariffs at the frontier, but the barriers behind the border, predominantly owing to differences in regulation… Tackling non-tariff barriers will be my primary focus” in talks with the US, he said.
And he called for a renewed impetus in trade talks with Russia, warning that the Eastern giant’s decision to launch a customs union with Belarus and Kazakhstan had hampered its move towards World Trade Organisation (WTO) membership, something the EU has long advocated.
Russia is “presently acting contrary to the engagements it has taken with the EU” by putting up tariffs which it had earlier pledged to lower, De Gucht said.
De Gucht said that he was “optimistic” that the Doha round of WTO talks would come to a deal by the end of 2011, though not necessarily this year, as leaders of the Group of Eight (G8) leading economies demanded in July.
“I personally am confident that we are going to conclude the Doha round. I don’t know if it will be in 2010 or 2011,” he said.
“We agree on 90 per cent of the topics in Doha… We are not going to tackle all the problems (of world trade) in the Doha round, there is still time afterwards,” he stressed.
At the same time, the Belgian – a former member of the European Parliament (MEP), former EU development commissioner and one-time Belgian foreign minister – rejected calls by EU states such as France for an import tariff on goods from countries which do not have strict climate-protection laws.
“There is a big risk that there will be a slippage into a trade war” if such tariffs are introduced, De Gucht warned.
Instead, the EU should develop a “firm political approach which fits in with market laws,” especially WTO rules, De Gucht said.
The EU has already pledged to cut its greenhouse-gas emissions to 20 per cent below 1990 levels by 2020, sparking fears that European manufacturers might outsource production to countries with less stringent climate rules.
The EU’s trade commissioner is responsible for carrying out trade negotiations on behalf of the 27-member bloc. De Gucht has been nominated to fill the post for the next five years, but his appointment requires the parliament’s approval.
