Renew: 28/03/2023 10:13
Issued by: 28/03/2023, 10:13 a.m
Brussels – The European Union will have new tools to deal with trade and economic pressure or intimidation by China and other countries. Member States and the European Parliament this morning agreed on the wording of the rules, which would allow the EU to apply retaliatory tariffs or import clearance restrictions in extreme cases. Some member countries are concerned that the possible use of the system will not lead to a trade war. It’s also why, contrary to the European Commission’s initial proposal, states are negotiating a greater share in deciding possible countermeasures.
Brussels came up with the idea of introducing trade options and economic defense last year in response to either Beijing’s aggressive trade practices or the protracted EU dispute over tariffs with the administration of former US President Donald Trump. A number of EU countries want to avoid the situation with Lithuania, with which China cut off trade ties because of Vilnius’ friendly policy towards Taiwan.
According to the commission, the rules agreed today should serve primarily as leverage for negotiations with third countries. The Union Executive in cooperation with member states will try to convince them to abandon coercive practices. If negotiations do not lead to a goal, the commission and the state will be able to decide on possible retaliation. This can take many forms, from introducing import fees to tightening licenses to restricting access to public contracts.
“Any countermeasures from the EU will only be implemented as a last resort,” the EU Council representing member states stressed today. These steps must also be in line with the rules of the World Trade Organization (WTO).
Today’s agreement must be formally approved by the plenary sessions of the European Parliament and the Council of the European Union. When that happens, a system of sanctions will be put into effect.
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