EU trade policies, European Parliament, Latest news

Dombrovskis delivers solid hearing in bid for EU trade chief post

Valdis Dombrovskis, Executive Vice-President for An Economy that Works for People, at his hearing in the European Parliament’s international trade committee. The Latvian seeks approval to assume responsibility for the EU’s trade portfolio. Credit: EP

The nominee to become the European Union’s next trade commissioner impressed the international trade committee of the European Parliament with his grasp of policy detail and concrete answers to thorny questions in one of the bloc’s most sensitive policy areas.

Valdis Dombrovskis, who already serves as executive vice-president of the European Commission  set out his vision for the trade brief and how he would deliver on EU policy goals at a hearing on Friday (2 October). Dombrovskis, a 49-year-old former Latvian prime minister, is set to fill Phil Hogan’s shoes after the Irish commissioner resigned in late August.

Now that the parliament’s political groups are deciding on Dombrovskis’ fate ahead of a formal vote in plenary, the initial sense is that convinced many. The international trade committee is set to recommend by “a large majority, one abstention” his endorsement by fellow MEPs, parliament sources say.

Cooperation, credibility and trust as guiding principles

Dombrovskis provided MEPs with his vision for EU trade, with a strong focus on international cooperation, credibility and trust to lead in times of crisis.

“Europe is a trusted global leader in the area of free and fair trade. Countries and regions around the world view Europe as a reliable and rewarding partner. This is why we have the best network of free trade agreements in the world,” Dombrovskis said.

In a gentle jab at the United States, Dombrovskis continued: “Europe’s global leadership has not been built by lecturing or attempting to impose our point of view. We have succeeded at the negotiating table by looking our partners in the eyes and finding areas of mutual interest.”

New ‘trade and climate’ initiative at WTO

On sustainability, which is a key concern for many MEPs and citizens with regards to trade, Dombrovskis announced that he is poised to launch a green initiative at the World Trade Organization seeking to tackle climate change and “focusing on green goods and services.”

“Building on the initiative of trade in environmental goods, which unfortunately stalled, [we] want to expand it not only for goods but also for services,” said Dombrovskis. The Environmental Goods Agreement negotiations were a plurilateral tariff deal on environmentally friendly goods that almost succeeded but ground to a halt in late 2016.

The idea is “to have something on the table already for the next ministerial conference,” which should be happening in June 2021 in Nur-Sultan, Kazakhstan.

Dombrovskis said that the plan is to cooperate with “like-minded countries” in groups like the Friends for Advancing Sustainable Trade, or FAST Group, and with the Ottawa Group.

No renegotiating Mercosur

The thorny topic of Mercosur and related environmental concerns was in the limelight at today’s hearing.

“One of the most urgent sustainability issues is to protect the Amazon rainforest: these are the lungs of our planet. Our best advantage is that we have an ongoing partnership discussion with Mercosur countries,” Dombrovskis said in his opening remarks.

Dombrovskis said that he would keep Mercosur on standby for ratification until Brazil and other Mercosur countries demonstrated their willingness to implement the sustainability provisions.

But when asked about his “exit strategy” if talks were to fail, Dombrovskis rejected the idea of straight out binning the Mercosur text.

“On reopening [of negotiations] of Mercosur, well that would not be the most straightforward course of action. Twenty years we negotiated, we conclude, and the first thing we throw it out and say, ‘no, we want to renegotiate everything?’ I think we are also losing credibility as international partner,” Dombrovskis explained.

“But we will be very clear on pre-ratification commitments. And by the way, we achieved very good results for example with Vietnam. […] That’s what we are exploring,” said Dombrovskis.

Transatlantic trade

As for trade relations with the US, Dombrovskis said that he wants to pursue dialogue.

“I will spare no effort in revitalising our strategic relationship with the United States. I will bring a fresh impetus to Transatlantic work on trade, technology, taxation, the reform of the multilateral trading system, including disciplines on industrial subsidies,” Dombrovskis said.

But Dombrovskis also said that the EU should not be afraid of imposing the WTO-sanctioned 4 billion USD in tariffs on US goods if Washington walks away from the table.

Realist on China

Dombrovskis showed cautious realism when speaking of China—Brussels “should pursue a results-oriented engagement with Beijing,” according to the executive vice-president.

“I co-chair the high-level economic dialogue with China in my current role. This gives me a clear understanding of the political and economic reality,” said Dombrovskis. “We will work to enhance our trade and investment relations with China, notably by concluding the comprehensive agreement on investment. However, our partnership must be restructured to be reciprocal, balanced and fair.”

Eyes bigger than stomach?

The executive vice president, whose current economic portfolio holds the title An Economy that Works for People defended taking over yet another dense topic by arguing that these dossiers feed into each other.

“We are discussing a lot how we are actually putting trade in a broader economic context […], and here my coordinating role as Executive Vice-President could actually be a valuable asset,” Dombrovskis stated.

As trade may soon become one more feather in his already very full cap, he ascertained that the role of executive vice-president is one of coordinating across directorates. With an incoming new Irish commissioner – Mairead McGuinness is the nominee – stepping into financial services, this means that he will be able to delegate many of his current responsibilities in this area.

“So far, it seems like all executive vice presidents are managing with their workload,” Dombrovskis quipped before adding, “And definitely I’m committed to engage very actively and very strongly in trade policy.”

Next steps

Following the INTA committee’s recommendation, the Conference of Committee Chairs will confer on the nomination on Monday (5 October). The conference will then provide its conclusions to the Conference of Presidents, and the MEPs will vote on whether to give their assent to Valdis Dombrovskis taking on his new role in plenary on 7 October.

 

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