Speech by European Commissioner for Trade Cecilia Malmström European Round Table of Industrialists
Ladies and gentlemen,
Thank you for inviting me here today. Today I want to talk to you about change – Trade is always changing, but every once in a while there are shifts that redefine how we do business.
As you are well aware, the world is interconnected in an unprecedented way – and Europe in particular. We want to shape globalisation, not to be shaped by it. It’s not only goods and services that we export through open global trade. It is our values and standards – sharing and enforcing them is a critical part of our response to globalisation.
As the EU we have particular power to do this. We are deeply embedded in global value chains – everyone does business with us, many want to do business with us. We are a market of 500 million consumers. And we have significant political weight to throw around.
90% of global growth in the next 10 to 15 years will take place outside the EU. If we want to shape globalisation, we will need to face it head on. One of the ways we do this is through an ambitious negotiating agenda.
Benefits of Japan agreement
We have finalised negotiations with Japan and now preparing to sign it. In this room we have the top business leaders in Europe. I do not have to tell most of you what an economic achievement this agreement is. Japan is the EU’s second largest trading partner in Asia, after China. In 2015 alone, the EU exported 58 billion EUR in goods and 28 billion EUR in services to Japan. The agreement is projected to increase this significantly.
At the moment Japan has custom taxes of: nearly 40% on beef up to 30% on chocolate 15% on wine up to 40% on cheese
Our agreement will break down these barriers and many others. All industrial products will be fully liberalised. We have strong commitments on services and investment. All these measures will stimulate business while passing on savings to consumers.
It will tackle other barriers for EU products too, like the lengthy procedures surrounding fruit exports. It will open up Japan’s services market to EU firms, and allow them to bid for more public contracts in Japan, like in the railway sector.
Our Japan agreement is the first we have negotiated with a chapter specifically on SMEs. We need to make sure that smaller firms have the information they need to take advantage of trade agreements.
SMEs are the backbone of the European economy. They represent 99% of all businesses in the EU. They have created around 85% of new jobs in the past 5 years. And this is not the only new development in our Japan agreement. Our chapter on Corporate Governance is another first. The EU and Japan are countries that share high standards in this area. The chapter commits us to: Transparency in publicly listed companies Accountability of management towards shareholders Fair exercise of shareholder rights And fairness in takeover transactions.
These measures will ensure a fair environment for EU and Japanese businesses to operate in, as well as building trust.
The EU-Japan agreement is the biggest bilateral trade agreement ever negotiated. It covers an area of over 630 million people, or a fourth of world GDP. When signed, approved and implemented, it will account for more than one quarter of the world’s GDP. It’s the most recent of our achievements. We hope that the agreement can be signed in July at an EUJapan Summit.
All of this, in the end, means jobs. For every additional 1 billion EUR in trade, that’s 14 000 extra jobs in the EU. As for the rest of our trade agenda, the provisional application of our deal with Canada is now in force. Mexico is another important trading partner of ours. The EU was Mexico’s third largest source of imports last year, after the US and China. We have had a long partnership with Mexico.
The agreement we negotiated with them in 2000 was a good one, but it needed an update. We have now updated it to the point where it’s basically a new agreement. An agreement for the 21st century, that includes topics like intellectual property and services, And it reflects our values with our first ever chapter on anti-corruption.
Elsewhere in Latin America we are negotiating with Mercosur. A large and highly protected market where EU business will be the first to get liberal access. We are making good progress in these negotiations, but we still need time. We do not want a fast deal at the expense of a good deal.
Our list of agreements now includes Singapore and Vietnam too. And soon we will have a deal with Chile. If sealed, it will be the first trade agreement we have with a chapter specifically addressing gender, as a pilot project. Chile has already done a lot in this field. Our policies are gender neutral, but they are not always gender sensitive. Trade and society at large are changing. Not so long ago the idea of women occupying positions among 50 of the largest companies in Europe would have been unthinkable.
Looking to the future, we just received a mandate to open negotiations with Australia and New Zealand.
Every negotiation concluded sends a message to the world. The EU and its partners are coming together to: shape globalisation, stand up for open trade, and to agree on a rule book that’s fair and works for everyone.
We stand against both uncontrolled liberalisation, unilateralism and the temptation of protectionism. And we need many allies these days.