EU trade policies, Germany, Latest news

German presidency and trade: strong emphasis on sovereignty issues and bilateral trade agenda

The German government officially released its fifteen-page work programme for the coming six months as it prepares to take over the rotating European Union presidency. To say the least Germany’s presidency comes at a very critical time for the EU.

Berlin’s text largely aligns with the EU’s general direction of travel in the face of the current geopolitical context and in the aftermath of the COVID-19 pandemic. However there are also divergences in outlook with, say, the European Commission, in key policy areas.

Competition and producing locally in pharma, agriculture

For example, Germany reiterates its goal to see the EU’s merger control policy change to allow the creation of Alstom-Siemens-style industrial mergers. Berlin is also silent in those fifteen pages on whether it wants to bring forward the European Commission’s much-desired reciprocity in public procurement instrument – even though the German text is sprinkled with references to public procurement policies.

The tone of the German government on issues related to supply chain resilience and reduction of import dependency is notable for being less ‘liberal’ than the Commission’s approach to these issues post COVID-19.

“We want to agree on concrete measures for greater autonomy of the EU in securing medical supplies with the member states. Of particular importance to us are securing the quality of active ingredients, greater transparency and diversification of supply chains and European cooperation in expanding active ingredient production for critical medicines,” reads the German text (loosely translated by yours truly).

“We want to strengthen the agriculture and food industry as ‘systemic’ sector (systemrelevante Branche) with a view to supplying the European population”, the text also says.

Full-on bilateral in trade

In terms of EU commercial diplomacy, the text reveals that for Germany there are four priority areas for the EU, listed in the following order: EU-US relationships – both political and commercial, EU-UK relationships, EU China, and EU African Union (including supporting the the African Continental Free Trade Area).

To the spite of many NGOs, which have already been writing to the German government and campaigning strongly against pursuing current FTAs – and notably against the Mercosur Association Agreement – Berlin sees the EU’s current FTA agenda as a top priority. Indeed it dedicates a very long paragraph to the matter.

“The conclusion of free trade and investment protection agreements is a fundamental contribution to the diversification and security of supply chains and to needed growth dynamics. We aim for swift progress in finalising the agreement with Mercosur and the modernised agreement with Mexico,” Berlin writes.

“We want to support the European Commission in bringing negotiations with New Zealand and Australia to a close, and to make progress in discussions with Chile, Indonesia and Tunisia.”

As to the sustainability issues raised by NGOs and others, the programme says that trade policy is one instrument to foster it, yet it also points to desired changes in the EU’s broader foreign policy instruments.

And what about the WTO?  The “modernisation agenda” for the WTO is mentioned in half a sentence dedicated to trade policy, the second half of which is precisely dedicated to the EU’s bilateral agenda.

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