Protectionism, Europe’s challenge. Speaking at the Finnish Commerce Federation conference in Helsinki on trends in retail and wholesale, EuroCommerce Director-General Christian Verschueren highlighted the challenges facing the sector due to a rising tide of protectionism worldwide and within Europe:
“Over the last five years, countries across the world have moved towards protectionist policies. We see the US government pull away from existing and new trade agreements, and others, such as China and India step up the rhetoric and barriers against foreign goods and service providers. The WTO has noted a doubling in the number of restrictions imposed by national governments of G20 countries over this period (1). Meanwhile retailers and wholesalers struggle with discriminatory legislation imposed in a number of EU Member States aimed at protecting national competitors. This is a threat to free trade globally and to the Single Market in Europe, two of the building blocks we need to strengthen – rather than undermine – if we are to see growth and employment improve.”
Verschueren pointed to the 500 million euro annual benefit to EU exporters of the recently implemented Canada-EU trade agreement, and the major increase in the 86 billion euros of goods and services exports to Japan likely to result from removal of many Japanese barriers and tariffs after the outline agreement on an EU-Japan free trade agreement. This contrasts positively with the US government seeking to renegotiate NAFTA and the US-Korea trade agreement, withdrawing from the Trans-Pacific Partnership, and putting TTIP and the talks in Geneva on liberalising services (TISA) on ice.
“We have consistently argued that building new barriers to trade is wrong-headed, and ultimately makes everyone poorer. Seeking to protect national champions puts up prices for consumers and stops them benefiting from competition. It arguably also harms the very companies it seeks to shield from those forces, by making them less able to compete globally and themselves adopt the innovation that competitors may introduce. Retail and wholesale thrive on competition, and it is the only proven way of ensuring that consumers get a good deal, and the economy can grow.”
(1) The 2016 WTO report on national measures imposed by G20 countries noted a rise of cumulative restrictions from 546 in 2011 to 1196 in 2016.