Europe seeks to set global trade rules after Trump steps back

BRUSSELS (Reuters) – If Donald Trump’s ditching of a U.S.-led trade alliance with Pacific Rim nations wasn’t a gift to the European Union, then it must be the next best thing.

The president’s decision on his first day in office effectively pulled the United States out of the race to frame global trade rules. With Washington preoccupied by an attempt to renegotiate its existing NAFTA treaty with Canada and Mexico, the EU has an opportunity to become the top setter of common business standards in a series of new deals.

Still the world’s biggest trading bloc, the EU is recovering its self-confidence after a long economic crisis and Britain’s vote to leave the union. Now it has much of Asia and Latin America in its sights for trade treaties, while a far-reaching pact with Canada will already enter force in September.

Japan turned to the Brussels this month to seal a deal on creating the world’s biggest open economic area, after being dumped by Trump’s scrapping of the 12-nation Trans-Pacific Partnership (TPP) free-trade accord in January.

EU trade chief Cecilia Malmstrom – who until Trump’s election had been struggling to persuade Tokyo to agree tough trade-offs – acknowledges the change of fortunes.

“I do not regard President Trump as a gift maybe, but it is true that many countries have started to look around more broadly,” she told Reuters. “Other countries feel that they need to look out for new friends and other allies, so yes, it has increased interest in cooperation with Europe and with others.”

Import tariffs are already low between developed economies, so negotiations now focus more on agreeing common standards. The aim is to make it easier and cheaper for firms to do business in differing markets, avoiding the need to tailor-make products to meet varying local rules, be they for cars or cheese.

For a graphic on EU trade deals, click

While China is seeking greater influence, the battle has largely been between U.S. and EU standards as…

Read the full article at the Original Source..

Back to Top