A COMPASS FOR EU TRADE POLICY - OPENNESS AND ASSERTIVENESS IN CHALLENGING TIMES

In a rapidly changing and challenging world, the European Union (EU) is seeking to strengthen its competitiveness. The EU’s economic model, based on trade among its member states and with the rest of the world, has made the EU prosperous. However, new economic security risks have emerged due to geopolitical tensions, technological development, climate change, the pandemic and Russia’s war in Ukraine. The sustainability agenda also impacts trade policy to an even greater extent today. European companies contribute to the green transition and social sustainability, and without trade, the EU cannot deliver on its sustainability goals.

These risks and challenges highlight the need for a trade policy that maintains openness while managing security and sustainability concerns. The new European Commission 2024–2029, with a Commissioner for Trade and Economic Security in particular, must minimise risks and preserve openness to trade and investment. Trade policy should create market access and transparent and predictable rules for companies to buy, sell, and invest across borders. This enables trade to contribute to competitiveness, sustainable growth and economic development.

The Confederation of Swedish Enterprise proposes the following goals for EU trade policy:

• Increase and preserve market access by developing multilateral trade rules, negotiating free trade agreements, reducing regulatory divergence, and ensuring open trade in goods and services. This is “traditional trade policy” that is still needed to ensure European firms can benefit from all the opportunities offered by global markets. Without it, Europe cannot prosper.
• Address risks and distortions while remaining open by exploring partnerships, managing security risks while keeping investment flows open, addressing distortive subsidies, and defending the EU against economic discrimination. This is part of the new economic security paradigm in Europe, in which a combination of positive incentives and assertive measures are applied to make the world safe for EU businesses to trade.
• Promote trade for sustainable development by ensuring trade and the green transition are mutually supportive and that supply chain requirements are clear and work in practice. This is primarily part of the green transition as the EU takes steps to transform its economy towards a more sustainable economic model, a transformation that must be led by business.