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Deterrent Measures EU Plans to Take Stronger Action Against Unfair Trade Practices

Source: dpa 2 min Reading Time

The European Union plans to further strengthen its efforts to combat unfair trade practices, such as those commonly associated with China, according to information obtained by dpa ...

New Weapons! Chancellor Friedrich Merz and French President Emmanuel Macron, in particular, are calling on the European Commission to take tougher action against unfair trade practices by certain countries. Read here to find out what that might look like...(Image: AI-generated)
New Weapons! Chancellor Friedrich Merz and French President Emmanuel Macron, in particular, are calling on the European Commission to take tougher action against unfair trade practices by certain countries. Read here to find out what that might look like...
(Image: AI-generated)

At a summit meeting, the heads of state and government of the EU member states called on the European Commission to urgently develop new instruments to address trade imbalances. At the same time, the Commission, under the leadership of Ursula von der Leyen, is to make more effective use of existing EU instruments and continue the dialogue. German Chancellor Friedrich Merz and French President Emmanuel Macron had previously been the main advocates for this call to the Commission. Both want a new instrument that would enable a decisive response when third countries cause serious and systematic distortions of the EU single market through political or economic means. To this end, the Commission should be able to regulate access to the EU single market. China is cited here merely as an example, as the United States could also be affected if necessary.

Last Resort: Even Drastic Measures are Possible

The proposal even cites the immediate exclusion of a third country from the single market as a possible extreme measure. To make deadlocks within the EU unlikely, the principle of reverse qualified majority voting is to be applied. This means that a Commission proposal is considered adopted unless at least 15 countries actively oppose it. Together, these countries must also represent at least 65 percent of the EU’s population, as reported. Merz and Macron are also calling for opportunities for diversification, which would ensure that companies no longer make the mistake of becoming overly dependent on individual countries and their exports. There are also plans for stricter controls of the single market. Those who repeatedly commit violations would be punished with restrictions on access.

The EU Wants to Encourage Dialogue in a More Subtle Way

According to the European Statistical Office, the EU recorded a trade deficit with China last year amounting to approximately 360 billion euros ($410.4 billion). In mathematical terms, this corresponds to about one billion euros ($1.14 billion) per day. The causes include dumping, excessive and widespread subsidies, and currency manipulation in certain countries. The new set of measures is primarily intended to serve as a deterrent and to ensure that China, for example, agrees to engage in dialogue to resolve trade conflicts. A first step in this direction was China’s agreement last week to curb Chinese exports of hybrid cars to Europe, which could reduce imports of such vehicles into the EU by more than 50 percent.

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