Step Four: EU global FTA agreements
This step outlines the regularities of the completion of the trade agreements with EU, and focuses of some recent challenges to that process.
The EU FTAs with all other global jurisdictions (about 80 at the moment) have a common pattern:
- Approximately 80% of the content of the agreements apply the WTO rules, the rest deals with, typically, more liberalized in terms of tariffs specificities but also with more stringent non-tariff rules and standards, plus exclusions of some (typically few) goods and services;
- The most comprehensive FTAs is EFTA, it is also a participation in the EU single market and the customs;
- One of the rules to be vigilant about is the state aid (more restrictive than WTO);
- In other words, countries would easier become FTA partners of the EU if they are WTO members; exemption are permitted, however (e.g. for some WB countries);
- Other trade/customs union agreements do not prevent FTAs with the EU, even sometimes help (e.g. Mercosur, CEFTA).
Negative political sentiments and trade-related tensions may affect the FTAs and the trade with the EU. Two cases will be covered:
- The failure of the Trans-Atlantic Trade and Investment Partnership (TTIP) between the EU and the USA, for negative motives and attitudes on both sides, although similar motives were overcome in the case of Comprehensive Economic and Trade Agreement (CETA) between Canada and the EU;
- The impacts of USA-China disputes are likely to no negative impacts of the trade between China and EU, or lead to positive developments.
Key economic notions: EFTA, CEFTA (Central European FTA), Mercosur, trade related disputes.
Sources: EU Trade, EUROSTAT, CEFTA, MERCOSUR, independent analysis