Is Free Trade Dead?

 

 

 

 

 

 

 

 

 

 

 

Is Free Trade Dead?

Amid growing opposition to supranational institutions – as epitomized by the latest Brexit referendum – and scepticism towards free trade agreements like TTIP and CETA, Politico seized the opportunity to host a symposium (behind a paywall, for Politico Pro subscribers) devoted to the current challenges faced by the EU’s trade agenda. It is against this backdrop that it asked policy-makers, trade representatives and academics from around the globe to share their view on the future of trade politics. My contribution to the debate is available hereafter.

Europe needs more serious debate on trade

Free trade is an essential part of the European Union’s founding principles. Even Brexit cannot change this. And yet the negotiation of a new generation of trade agreements has become highly politicized across the Continent.

Many EU international agreements are “mixed agreements,” meaning they cover subject matters that fall both under EU and national competence. Amid growing public hostility to free trade, several countries have claimed the right to subject agreements that fall under exclusive EU competence to the vote of their national parliaments. But is this really necessary?

The legal answer is a resounding no. The political one, unfortunately, is an unqualified yes.

The mismatch between European law and political reality has more to do with the unprecedented scale of these new agreements than a full rejection of free trade.

These new trade agreements touch on a wider scope of policy areas. Given their rather intrusive approach to domestic regulatory autonomy, the interests at stake are now also of constitutional significance. They affect private companies, civil society organizations, individual citizens, and third-party states.

Opposition to these deals comes from a resistance to unprecedented forms of deep, economic integration. Even in the post-Brexit political debate, the most contentious issue is not trade — the Leave camp want to remain in the internal market — but the free movement of people. The options on the U.K.-EU negotiating table will be lighter forms of economic integration, such as the U.K. becoming a member of EFTA and/or the European Economic Area.

Although negotiations for new-generation trade agreements require more parliament involvement than in the past, the current framework does not adequately address growing public demand for greater transparency and civil society involvement. The time has come for a more informed public reflection on the pros and cons of deeper forms of economic integration.

This is especially crucial given that these deals are not purely economic but — in some cases more than others — also have strongly geopolitical and cultural ambitions. Unfortunately, an increasing number of political leaders appear to be captivated by the vocal protesting minority instead of engaging in more serious reflection about the meaning and purpose of free trade in Europe.