Competitiveness and economic security – how should EU trade policy contribute to the objectives of the Draghi report?

Key points

The EESC:

• believes that if trade is to make an effective contribution to the objectives of the Draghi report, trade policy must be closely coordinated with industrial policy and European economic security policy. This requires a common European foreign policy and security strategy, one of the main components of which is a foreign economic and trade policy;
• points out that the main objectives of this policy coordination should be in line with an integrated concept of open, sustainable and assertive trade policy, aimed at: a) securing the supply of critical raw materials and sustainability of supply chains in general; b) enabling Europe to be competitive and produce using the most advanced technologies and to lead fair and sustainable ecological and digital transitions; and c) contributing to a significant reduction in energy prices – a major factor in the loss of competitiveness of the European economy;
• believes that, in view of the current evolving circumstances, there is a need for unified action, and potentially for a response at EU level; this will require strong leadership, including making use of existing trade-defence tools if tariffs are imposed illegally, including retaliatory tariffs, economic diplomacy action, and WTO challenges. Trade diversification is also strongly recommended;
• proposes the establishment of an EU Investment Fund for Economic Resilience and Sustainable Competitiveness to help strengthen the financial capacity of the EU and the EIB’s lending capacity for supporting InvestEU programmes. The completion of the Banking Union and the Capital Markets Union would facilitate the transfer of private capital into investment at a significantly higher rate;
• stresses that, to ensure that EU trade standards remain effective in protecting the wider interests of the EU, civil society must have a role in the negotiation procedures. The structured participation of civil society organisations in the form of consultations during negotiations would provide an opportunity to highlight certain critical issues regarding the impact of agreements before they are approved.