Commission Sides with Rutte over Macron on Industrial Policy

Emmanuel Macron Mark Rutte
French president Emmanuel Macron speaks with Dutch prime minister Mark Rutte during a European Council summit in Brussels, June 24, 2018 (Elysée/Philippe Servent)

The European Commission has sided with the Netherlands and smaller nations against a Franco-German proposal for industrial policy.

The decision is a victory for Dutch prime minister Mark Rutte, who has formed a loose alliance of likeminded Central and Northern European member states to prevent a lurch to protectionism in a Europe without the UK. Read more “Commission Sides with Rutte over Macron on Industrial Policy”

Biden Did Not End Trump’s Trade War with Europe

Kamala Harris Joe Biden
Vice President Kamala Harris and President Joe Biden of the United States deliver a news conference outside the White House in Washington DC, May 13 (White House/Adam Schultz)

During last year’s presidential election, Joe Biden promised to end America’s “artificial trade war” with Europe. His predecessor, Donald Trump, had imposed $7.5 billion worth of tariffs on European aluminum and steel.

Biden has relaxed the tariffs, but not abolished them. The EU has completely pulled down its retaliatory tariffs on bourbon whisky and Harley-Davidson motorcycles.

If anyone deserves credit for ending the trade war, it’s the EU. Read more “Biden Did Not End Trump’s Trade War with Europe”

Dutch and Spanish Leaders Share Vision for EU

Mark Rutte Pedro Sánchez Charles Michel
Prime Ministers Mark Rutte of the Netherlands and Pedro Sánchez of Spain speak with European Council president Charles Michel in Brussels, July 20, 2020 (European Council)

Less than a year ago, Mark Rutte and Pedro Sánchez were on opposite ends of the debate about the EU’s coronavirus recovery fund. Sánchez and other Southern European leaders called for grants financed by EU-issued bonds. Rutte and his allies preferred loans. The two sides eventually split the difference.

Now the two prime ministers, one center-right, the other center-left, have made common cause for a version of European “strategic autonomy” that is more liberal than Emmanuel Macron’s.

In a joint “non-paper“, the Dutch and Spanish leaders endorse strategic economy as a means to an end — growth and security — but not an end in itself. They caution it mustn’t become an excuse for isolation and protectionism. Read more “Dutch and Spanish Leaders Share Vision for EU”

What to Make of the EU-UK Trade Agreement

European Union flags
Flags of the United Kingdom and the European Union outside the Berlaymont in Brussels, January 29, 2016 (European Commission)

I haven’t read the 1,246 pages of the EU-UK trade agreement, so I’m going to rely on trusted sources to make sense of the accord.

First, a couple of notes on terminology.

This treaty, the EU-UK Trade and Cooperation Agreement, governs the future cross-Channel relationship. It is due to go into effect on January 1, although it will still need to be ratified by the parliaments of the European Union and the United Kingdom as well as the European Council.

Last year’s withdrawal agreement regulated Britain’s exit from the EU. It provided for a one-year transition period, which expires on December 31, and included a protocol for Northern Ireland, which keeps the province in the European single market for goods and effectively (but not legally) in the EU customs union to avoid the need for a border with the Republic of Ireland.

Both treaties have been unhelpfully referred to as “the deal” in the English-speaking press, but only the withdrawal agreement was crucial. The trade agreement, while good to have, since Britain does most of its trade with the EU, was always optional. Read more “What to Make of the EU-UK Trade Agreement”

“Strategic Autonomy” Divides Europe’s Top Liberals

Angela Merkel Emmanuel Macron Mark Rutte
German chancellor Angela Merkel, European Commission president Ursula von der Leyen and French president Emmanuel Macron watch Dutch prime minister Mark Rutte walk into a European Council meeting in Brussels, July 18 (European Council)

Emmanuel Macron and Mark Rutte belong to the same European liberal family, but they take different views on the future of the liberal world order.

The French president believes Europe should become less reliant on the United States and foreign trade. He argues for “strategic autonomy” in everything from the digital economy to defense to environmental policy.

The Dutch prime minister has doubts, rooted in decades of Dutch Atlanticism and centuries of overseas trade.

Both have allies.

Macron has the support of German chancellor Angela Merkel and European Commission president Ursula von der Leyen, a former German defense minister.

Rutte is backed by smaller countries in Central and Northern Europe as well others in the European Commission. The Financial Times reports that plenty suspect “strategic autonomy” is a fancy way to dress up French protectionism; are wary of formally endorsing the principle if it means undermining NATO and open trade; and are skeptical of the push for reshoring of industry and supply chains.

They have reason to be. Read more ““Strategic Autonomy” Divides Europe’s Top Liberals”

Cyprus Votes Against EU Trade Deal with Canada

Nicos Anastasiades Mette Frederiksen
President Nicos Anastasiades of Cyprus speaks with Prime Minister Mette Frederiksen of Denmark in Brussels, February 20, 2020 (European Council)

First tiny Wallonia threatened to derail the EU’s free-trade agreement with Canada. Now Cyprus, with a population of 1.2 million, is putting at risk a treaty that covers nearly 500 million consumers and 28 percent of the world’s economy.

Cypriot lawmakers voted 37 to eighteen against the Comprehensive Economic and Trade Agreement (CETA), which eliminates nearly all tariffs between Canada and the EU and includes mutual recognition of professional qualifications and product standards.

It’s one of those product standards the Cypriots are unhappy about. They argue CETA should close the Canadian market to foreign ripoffs of their national cheese, halloumi. Read more “Cyprus Votes Against EU Trade Deal with Canada”

Why Kosovo Is Lifting, But Will Likely Reinstate, Tariffs on Serbia

Kosovo’s new prime minister, Albin Kurti, is partially lifting his predecessor’s 100 percent import tariff on Serbian goods. He has offered to lift the tariff completely if Serbia suspends its derecognition campaign. If it fails to reciprocate, the tariffs will be restored in June.

Since reciprocation would imply Serbian recognition of Kosovo’s independence, it seems inevitable the trade sanctions will be back soon. Read more “Why Kosovo Is Lifting, But Will Likely Reinstate, Tariffs on Serbia”

Dutch Senate Could Torpedo EU-Canada Trade Deal

Mark Rutte
Dutch prime minister Mark Rutte arrives in Brussels to meet with other European leaders, February 12, 2015 (European Council)

Dutch parliamentarians narrowly approved an EU trade agreement with Canada on Tuesday, but ratification of the treaty faces an uphill battle in the Senate, where Prime Minister Mark Rutte’s ruling parties do not have a majority.

If the pact isn’t supported by the Netherlands — one of the EU’s most liberal and free-trading nations — it would call the bloc’s ambition to uphold the global trade regime in lieu of American leadership into doubt.

Since Donald Trump was elected in 2016, the EU has completed free-trade agreements with Japan and South America. The first went into effect in 2019, the second has yet to be ratified. Read more “Dutch Senate Could Torpedo EU-Canada Trade Deal”

Germany Can’t Blame Trump for Its Slowing Economy

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HafenCity Universität station of the Hamburg U-Bahn, Germany, February 18, 2019 (Unsplash/Danijel Durkovic)

Germany may be heading into a recession. Its economy shrank .1 percent in the second quarter of this year.

Donald Trump’s trade war with China is partly to blame, but it has also exposed Germany’s home-grown vulnerabilities: an overreliance on exports and weak domestic demand. Read more “Germany Can’t Blame Trump for Its Slowing Economy”

Arguments For and Against Macron’s Mercosur Threat

Angela Merkel Emmanuel Macron
German chancellor Angela Merkel and French president Emmanuel Macron meet on the sidelines of a European Council summit in Brussels, June 20 (Elysée/Soazig de la Moissonniere)

French president Emmanuel Macron has threatened to hold up ratification of an EU trade deal with Mercosur unless Brazil’s Jair Bolsonaro does more to fight fires in the Amazon Rainforest.

Canada, Finland, Ireland and the Netherlands have backed Macron up. Germany is less sure. Donald Trump is expected to side with Bolsonaro at the G7 summit this weekend.

Here are the arguments for and against the threat. Read more “Arguments For and Against Macron’s Mercosur Threat”