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The EU and the WTO | Brussels, 6 July 2011

WTO report acknowledges EU’s firm commitment to open trade during crisis

In its assessment of the European Union’s trade policy the WTO Secretariat pays tribute to the openness of European markets and the transparency of the EU’s trade and investment regime despite intensified protectionist pressure during the global economic and financial crisis. The report published today concludes that this policy has helped stabilising the multilateral trading system. WTO Member countries and the WTO Secretariat will discuss the report today and on Friday, 8 July in Geneva.

The WTO Trade Policy Review notably outlines that:

  • The EU has a significant interest in undertaking further trade and investment liberalisation, in line with its recognition that an open trade regime is vital to enhance external competitiveness and economic growth. The fact that 85% of its total imports enter the EU under the Most Favoured Nation (MFN) regime illustrates the fundamental importance of the multilateral trading system for the EU.The EU has been a major driving force in the Doha negotiations and in integrating developing countries into the multilateral trading system:
    • The EU and its Member States are among the leading providers of aid for trade - in 2008, EU and member State support for trade-related assistance exceeded the target set in 2005 to provide €2 billion annually by 2010 (€1 billion by the EU and €1 billion by Member States).
    • In addition, in late 2009, the EU eliminated tariff quotas on imports of rice and sugar under its Everything But Arms scheme, an arrangement under the EU's Generalised System of Preferences (GSP) that grants duty-free and quota-free access to the EU market for least developed countries. Moreover, the EU has introduced new, more flexible rules of origin for products imported under GSP. The new rules are simpler and allow additional goods, in particular those processed in the least developed countries, to qualify for preferential treatment.
  • Competition policy in the European Union remains a central pillar of the Single Market, protecting consumers from abusive practices and preventing anti-competitive practices. Further improvement of the single market remains a priority for the EU, including in the framework of the Europe 2020 strategy.
  • The EU has been at the forefront of liberalisation in some specific services sectors: reforms in postal services and telecommunications stand out as significant achievements. Progress has been made in the liberalisation of the EU's internal market for services, which is work in progress.
  • The EU has made significant progress in implementing the reforms of the EU's Common Agriculture Policy (CAP). The budget spending on export subsidies has fallen to less than one-tenth the level of the early 1990s. The comprehensive reform of domestic support and export subsidies in the CAP has improved transparency and reduced trade and production distortions. The WTO recommends pursuing this path further.

The Trade Policy Review Mechanism is the most important transparency exercise of the WTO. It systematically and regularly analyses and assesses the trade policies of the WTO member countries and thus shows how well they comply with the rules, disciplines and commitments initially made. It outlines the trade policies and practices of WTO members and by doing so promotes a smoother functioning of the multilateral trading system.

The four largest Members in terms of trade volume are reviewed every two years. Currently, these Members are the EU (last reviewed in April 2009), the US (last reviewed in September 2010), Japan (last reviewed in February 2011) and China (last reviewed in June 2010). The next 16 Members are reviewed every four years. All other countries are being reviewed every six years. A longer period may be fixed for Least Developed Countries.

The review of the EU's trade policy is based on a report presented by the WTO Secretariat, a report from the EU and written questions from Members, to which the EU replies in writing. The EU has received more than 800 advance written questions. The WTO Trade policy Review meeting takes place in Geneva on 6 and 8 July 2011.

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