In 2022, our demands for a thorough review and update of the EU’s Trade and Sustainable Development approach were met with a reform process by the Commission. The new strategy better reflects our progressive principles, and includes an enhanced enforcement mechanism for environmental and labour provisions, roadmaps for sustainability implementation, and a more prominent role for civil society. In the latter part of this parliamentary term, we have seen this new approach reflected in the agreements with the UK and New Zealand which contain sanctions as a last resort for enforcing the Trade Sustainable Development chapter of the agreements. We consider this a benchmark for future agreements.
This flagship piece of legislation was launched following a strong campaign from our group, and negotiations are being led by the S&Ds. We are fighting to ensure all products and companies are included so that no products from modern slavery end up on our market. We support swift action in cases of widespread state-sponsored forced labour, and for victims to be compensated.
The trade agreement with Mercosur (Argentina, Brazil, Paraguay and Uruguay) has not yet been presented to Parliament for a binding vote, but even before this, the S&Ds led demands for additional provisions on environmental protection and tackling deforestation. We secured a new proposal from the Commission with additional measures to enhance protection of the Amazon and strengthen sustainability, which is still under negotiation with Mercosur partners.
Our group insisted that alongside negotiations for a trade agreement with Vietnam, we expected the country to reform its labour code and ratify outstanding International Labour Organisation core conventions. The Vietnamese National Assembly approved the trade agreement on the same day as adopting a comprehensive reform of labour laws and ratifying the International Labour Organisation convention of forced labour. The trade agreement now provides a solid basis for the EU to monitor the implementation, including through formal mechanisms with European and Vietnamese civil society.
The Energy Charter Treaty is an outdated investment agreement which protects investments in the energy sector in 53 (mostly European) countries. Over the past 30 years it has been used by energy companies to take legal action against government measures, often ones inside the EU which were intended to fulfil Green Deal objectives. Our group has led the campaign to exit the agreement and finally, in recognition of this, in 2023 the Commission proposed a co-ordinated exit of the EU and member states.
Our Group has long fought for greater attention to be paid to the impact of trade policies on women, and mechanisms to tackle discrimination. As a result, the recently-negotiated agreements with New Zealand and Chile both contain dedicated sections on trade and gender with commitments to implement relevant international conventions, joint agreements not to weaken protection for women, and joint initiatives to maximise women’s participation in trade.
The World Trade Organisation (WTO) remains at the heart of regulating global trade fairly, and the EU must remain a committed leader in defending it. Recent success in reforming fisheries subsidies and cooperating on the pandemic response has begun a revitalisation of the organisation. Substantially reforming the organisation is an urgent priority to ensure it is up to 21st century challenges. We look forward to a reform that encompasses the three pillars: the negotiating and monitoring pillars, the dispute settlement mechanism, and to unlock the current deadlock on enforcing global rules. We encourage countries to join the Multi-Party Interim Appeal Arbitration Arrangement while the Appellate Body remains blocked.
The global pandemic which exposed vulnerabilities in supply chains, Russia’s invasion of Ukraine, and the weaponisation of trade policy by China has shown the pressing need to ensure our trade policy can withstand global pressures. We have supported further opening the EU market to Ukraine to support its economy - with flanking measures to support affected European producers - and increased market access for neighbouring countries which are facing enormous pressure from Russia. Our group is strongly pushing for the opening of negotiations with Taiwan for an investment agreement, while upholding the One China policy. We urge continued de-risking and diversification of supply chains, and increased cooperation with like-minded partners on securing a reliable supply of critical raw materials. We support further development of the European Economic Security Strategy including strengthening the screening of inbound investment to protect critical infrastructure. We are supportive of developing the Indo-Pacific strategy and trade negotiations with partners in South-East Asia, but not at any cost and only with robust defence of EU standards and values. We support strong transatlantic relations and the creation of the Trade and Technology Council. We work for closer ties with Latin America and are investing political and technical capital to finalise the agreements with Mercosur, Mexico and Chile.
We have consistently fought for initiatives to prevent the exploitation of people in international trade. We are leading negotiations for new Corporate Sustainability Due Diligence legislation, which will require companies to undertake human rights and environmental checks in their value chains. We are also leading the initiative for the Forced Labour Regulation to ban products made with modern slavery from being sold on the EU market, with compensation for victims wherever they are in the world. We are strong defenders of the Conflict Mineral legislation to ensure key metals used in the EU are not fuelling violence. We are urging proper implementation of existing rules on Dual Use which requires export controls on items which have both civilian and military use, to ensure they are not used for human rights violations. A decade on from the Rana Plaza garment factory disaster in Bangladesh, much more still needs to be done in the textile sector to protect workers, clean up fast fashion and ensure compliance with International Labour Organisation standards. We support accelerating work on the Cocoa Initiative to tackle child labour and deforestation in the chocolate supply chain.
In this parliamentary term, we achieved a thorough review and progressive reform of the EU’s Trade and Sustainable Development strategy. The Resolution we adopted to welcome the new approach and guide the Commission in its implementation was a breakthrough. We are now strongly insisting this new approach is reflected in new and updated trade agreements. After many years of leading calls for sanctions-based enforcement, we welcome the inclusion of this in recent trade agreements, which is now the gold standard for future agreements. We strongly support the climate objectives of the Paris Agreement as an essential element of trade agreements, and expect strong commitments on the phase-out of fossil fuels, measures to support the Carbon Border Adjustment Mechanism to ensure fair carbon pricing between goods made in the EU and imported, and the liberalisation of of green goods and services, with the list of qualifiying products and services regularly updated. We support strong trade commitments on sustainable food systems, protection of biodiversity, improvements to animal welfare standards, and the joint promotion of circular economy objectives. We insist on non-regression clauses to prevent either party weakening standards, and urge more rapid action for environmental backsliding by partners. We strongly support trade initiatives on tackling deforestation, including the Deforestation Regulation and forestry law enforcement agreements with partner countries to regulate the trade in legal timber, and support local communities and smallholders affected by deforestation.
We insist that trade preferences for developing and the least developed countries must be asymmetrical and support diversification. Mineral-rich developing and the least developed countries must be able to progress upstream processing industries and not solely rely on exporting raw materials. We believe EU trade preferences must be inextricably linked to the promotion of human rights, labour rights, environmental standards and good governance in order to develop sustainable growth. We urge swifter action when countries systematically fail to meet their international commitments in these areas, and greater use of enhanced engagement with particularly vulnerable countries to prevent further backsliding. We are constructively engaging for fair and sustainable Economic Partnership Agreements with African, Caribbean, and Pacific countries, and a reform of the Generalised System of Preferences to support developing countries’ access to the EU market: for our group, this will never come with conditionality for cooperation on migration.
We believe the EU is at a critical juncture in ensuring our trade and investment agreements remain fit for the 21st century. We support the inclusion of further provisions on digital trade, and using innovations such as blockchain to facilitate the trade in goods. We welcome the standalone digital partnerships which are being negotiated with selected partners, as well as comprehensive digital chapters in Free Trade Agreements. We are strongly supportive of the e-commerce negotiations taking place at the WTO.
We stand fully behind consistent and fair application of trade rules, and the need for the EU to defend our sovereignty and autonomy. We recognise that this requires both multilateral and bilateral solutions to trade disputes, in particular while the WTO dispute settlement is blocked. We strongly support the newly updated EU rules on enforcing trade obligations, when facing non-compliance from partner countries. Our group also led on the creation of the new Anti-Coercion Instrument to equip the Union to take action when faced with economic coercion from third countries, which is a key part of the toolbox on Economic Security.
