MercoPress. South Atlantic News Agency

Netherlands aligns with “protectionist” French policy in trade deals conditions

Emmanuel Macron welcomes Dutch Prime Minister Mark Rutte for a working lunch at the Elysee Palace in Paris in February. REUTERS

France and the Netherlands have joined forces to urge the European Union to enforce environmental and labor standards more forcefully with countries the bloc signs trade deals with, according to a document anticipated by the Financial Times.

The initiative comes as the EU tries to negotiate a new trade deal with Britain, which formally left the bloc on Jan 31, amid concerns that it might seek to undercut EU labor and environmental standards to boost its competitiveness.

The involvement of the traditionally strongly pro-free trade Dutch underscores a shift in European thinking on the need to protect domestic industry and jobs, a French diplomat said, as the coronavirus pandemic batters the global economy.

A more assertive China and US President Donald Trump's more protectionist 'America-First' agenda have also helped to reshape European attitudes towards free trade.

In their joint proposal sent to the other 25 EU member states, the French and Dutch trade ministers urge the European Commission to be ready to raise tariffs against trade partners that fail to meet their commitments on sustainable development.

“Trade policy instruments can provide additional leverage to the implementation of international environmental and labor standards,” the document said.

The EU should link tariff reductions “where relevant” to the effective implementation of trade and sustainable development provisions and be willing to take action when those provisions are breached, it added.

An official at the European Commission, which handles trade policy on behalf of EU member states said the proposals were “timely” and would be taken into account in a policy review announced by Trade Commissioner Phil Hogan and planned for later this year.

The French and Dutch, who want the proposals applied both to deals under negotiation and to updates of existing trade pacts, urged the Commission to inform member states more regularly on the impact that trade deals have on European jobs and domestic industries.

The document also says a commitment to the Paris Agreement on climate change must be a pre-requisite for any trade pact. Trump has decided to ditch the climate pact.

France has long favored a more protectionist stance on trade. As early as his first EU summit in 2017, President Emmanuel Macron said attracting foreign investment should not mean exposing Europe to “the disorder of globalization”, and he cautioned the EU against being too “naive” in global trade.