An Open, Sustainable and Assertive Trade Policy: EU to toughen up on Trade

On 18 February, the European Commission presented its new Communication on Trade: An Open, Sustainable and Assertive Trade Policy. The communication outlines the EU’s trade strategy for the coming years. The EU will toughen up towards trading partners and sustainability will be at the heart of the new trade strategy.


Open Strategic Autonomy


As expected, the new trade policy builds on the principle of ‘Open Strategic Autonomy’ and aims to establish resilient and sustainable value chains. The Commission will identify strategic dependencies in industrial ecosystems and enhance dialogue with third countries in strategic areas for EU competitiveness. The new trade policy should ensure a stable, rules-based and open trading system allowing the diversification of supply chains and an undisrupted access to critical supplies.


Sustainability at the heart of EU trade

While the concept of Open Strategic Autonomy might be the building block for the new trade policy, sustainability will be a defining pillar within the strategy. As Executive Vice President Valdis Dombrovskis mentioned during the press briefing, ‘adherence and commitment to the Paris Agreement will be an essential element in future trade an investment agreements.’ Additionally, the Commission will review the 15-point Action Plan to ensure the effective implementation and enforcement of the Trade and Sustainable Development Chapters (TSDs) in trade agreements. And when it comes to establishing sustainable and responsible value chains, the Commission will soon publish a proposal on mandatory due diligence. The implementation of the CBAM should also ensure that EU climate policies can no longer be undermined by carbon leakage.


A more assertive approach

Besides taking a ‘green’ approach on trade, the EU will also become more assertive towards trading partners. The Commission will prioritize WTO reform and focus on the correct implementation and enforcement of free trade agreements. The EU will make better use its trade toolbox and is working on a legal framework to counter market distortions caused by unfair foreign subsidy tactics.


Coming at a time of crisis, the EU’s new trade policy provides for a unique opportunity to establish a more sustainable growth model, while contributing to the economic recovery and supporting green and digital ambitions. Executive Vice President Dombrovskis will present the strategy to the European Parliament’s International Trade Committee on 24 February.

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