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Proposal Would Allow E.U. to Retaliate Against Economic Pressure Proposal Would Allow E.U. to Retaliate Against Economic Pressure
(about 2 hours later)
BRUSSELS — The European Union on Wednesday proposed new measures that would allow it to punish parties seeking to influence its political policies through economic pressure, like trade restrictions or the boycotting of European products.BRUSSELS — The European Union on Wednesday proposed new measures that would allow it to punish parties seeking to influence its political policies through economic pressure, like trade restrictions or the boycotting of European products.
The European Commission, the bloc’s executive branch, put forward what it called an “anti-coercion instrument” relating to what it views as unfair trade pressure, arguing that new tools were necessary because of the “weaponization of trade for other geopolitical purposes.”The European Commission, the bloc’s executive branch, put forward what it called an “anti-coercion instrument” relating to what it views as unfair trade pressure, arguing that new tools were necessary because of the “weaponization of trade for other geopolitical purposes.”
The proposed measures would give the commission wide-ranging powers to impose punitive sanctions on individuals, companies and countries. The proposal includes tariffs and quotas; the restriction of intellectual property rights; and limiting access to the bloc’s financial markets, public procurement and E.U.-funded research programs.The proposed measures would give the commission wide-ranging powers to impose punitive sanctions on individuals, companies and countries. The proposal includes tariffs and quotas; the restriction of intellectual property rights; and limiting access to the bloc’s financial markets, public procurement and E.U.-funded research programs.
Officials said that the measures were needed because the bloc had been the target of economic intimidation in recent years.Officials said that the measures were needed because the bloc had been the target of economic intimidation in recent years.
“The European Union will not hesitate to push back when we are under threat,” Valdis Dombrovskis, the bloc’s commissioner for trade, told reporters on Wednesday, adding that the bloc will “stand firm in defending itself.”“The European Union will not hesitate to push back when we are under threat,” Valdis Dombrovskis, the bloc’s commissioner for trade, told reporters on Wednesday, adding that the bloc will “stand firm in defending itself.”
The measures would also limit the ability of individual member countries to veto retaliatory sanctions against third countries, something that has often undermined the unity of the bloc. Under the commission’s proposal, sanctions could only be blocked by a majority of member nations, circumventing the current requirement for unanimity.The measures would also limit the ability of individual member countries to veto retaliatory sanctions against third countries, something that has often undermined the unity of the bloc. Under the commission’s proposal, sanctions could only be blocked by a majority of member nations, circumventing the current requirement for unanimity.
Mr. Dombrovskis cited a recent case involving a dispute between Lithuania and China as one in which actions by Beijing could “clearly be a reason” to trigger the measures.Mr. Dombrovskis cited a recent case involving a dispute between Lithuania and China as one in which actions by Beijing could “clearly be a reason” to trigger the measures.
Lithuania, which is a member of the European Union, has accused Beijing of blocking imports of its products after Lithuanian authorities allowed Taiwan, which China considers a part of its territory, to open a representative office in Vilnius, the Lithuanian capital, in November.Lithuania, which is a member of the European Union, has accused Beijing of blocking imports of its products after Lithuanian authorities allowed Taiwan, which China considers a part of its territory, to open a representative office in Vilnius, the Lithuanian capital, in November.
He added that “restricting or threatening to restrict gas supplies as a tool to influence E.U. decision making” could also qualify as grounds for activating the measures.He added that “restricting or threatening to restrict gas supplies as a tool to influence E.U. decision making” could also qualify as grounds for activating the measures.
President Aleksandr G. Lukashenko of Belarus last month threatened to cut gas supplies to the European Union if the bloc imposed sanctions on his country over a migrant crisis on the border with Poland that E.U. officials say he orchestrated.President Aleksandr G. Lukashenko of Belarus last month threatened to cut gas supplies to the European Union if the bloc imposed sanctions on his country over a migrant crisis on the border with Poland that E.U. officials say he orchestrated.
Jonathan Hackenbroich, of the European Council on Foreign Relations, said that the European Union was also mindful of the pressures it had faced from the United States when it was led by President Donald J. Trump.Jonathan Hackenbroich, of the European Council on Foreign Relations, said that the European Union was also mindful of the pressures it had faced from the United States when it was led by President Donald J. Trump.
“The Trump experience has been one of the biggest shocks of the last years that influenced the European thinking,” Mr. Hackenbroich said, referring to retaliatory tariffs on steel and aluminum imposed by President Trump on some European countries, as well as secondary sanctions stemming from U.S. punitive measures on Iran and Russia.“The Trump experience has been one of the biggest shocks of the last years that influenced the European thinking,” Mr. Hackenbroich said, referring to retaliatory tariffs on steel and aluminum imposed by President Trump on some European countries, as well as secondary sanctions stemming from U.S. punitive measures on Iran and Russia.
“Now the thinking is mainly about China and Russia,” said Mr. Hackenbroich. “But what happened during the Trump years is still in the back of the Europeans’ minds.”“Now the thinking is mainly about China and Russia,” said Mr. Hackenbroich. “But what happened during the Trump years is still in the back of the Europeans’ minds.”
To become law, the proposal has to be approved by a majority of member nations and by the European Parliament. It is likely to face opposition from some member nations, including Sweden and the Czech Republic, which worry the measures may breach the rules of the World Trade Organization and be disproportionate.To become law, the proposal has to be approved by a majority of member nations and by the European Parliament. It is likely to face opposition from some member nations, including Sweden and the Czech Republic, which worry the measures may breach the rules of the World Trade Organization and be disproportionate.
Analysts say that the measures could enhance the bloc’s geopolitical clout, but that they carry a risk of escalating trade wars, instead of deterring them.Analysts say that the measures could enhance the bloc’s geopolitical clout, but that they carry a risk of escalating trade wars, instead of deterring them.
“The European Union has always professed to be a strong supporter of multilateralism, so they have to be very careful when designing such mechanisms,” said Fabian Zuleeg, head of the European Policy Center, which is based in Brussels. “But the key thing is that from a European perspective, the multilateral institutions are not capable of dealing with such challenges. So the European Union has to find parallel ways of defending its values and interests.”“The European Union has always professed to be a strong supporter of multilateralism, so they have to be very careful when designing such mechanisms,” said Fabian Zuleeg, head of the European Policy Center, which is based in Brussels. “But the key thing is that from a European perspective, the multilateral institutions are not capable of dealing with such challenges. So the European Union has to find parallel ways of defending its values and interests.”
One question, Mr. Zuleeg said, is how countries like China or the United States would react to deterrent measures from the European Union.One question, Mr. Zuleeg said, is how countries like China or the United States would react to deterrent measures from the European Union.
“If you apply that to a country which is very powerful, and which has a lot of potential to then put countermeasures in place, which are justified from their point of view, then you can quickly get into a very difficult situation which can escalate,” he said.“If you apply that to a country which is very powerful, and which has a lot of potential to then put countermeasures in place, which are justified from their point of view, then you can quickly get into a very difficult situation which can escalate,” he said.
France, which will take over the E.U. presidency in January, said in a statement through its trade ministry that the proposed measures fill “a critical gap” and would be a step toward “less naïve trade policy.”France, which will take over the E.U. presidency in January, said in a statement through its trade ministry that the proposed measures fill “a critical gap” and would be a step toward “less naïve trade policy.”
Most members of the European Parliament have been advocating for a more assertive stance on trade and foreign policy, and some welcomed the proposal.Most members of the European Parliament have been advocating for a more assertive stance on trade and foreign policy, and some welcomed the proposal.
Anna-Michelle Asimakopoulou from the Parliament’s trade committee called it “a necessary and important tool” to “deter blackmail and unfair practices.”Anna-Michelle Asimakopoulou from the Parliament’s trade committee called it “a necessary and important tool” to “deter blackmail and unfair practices.”
Bernd Lange, the chairman of the Parliament’s trade committee said it was important to have a broad definition of economic coercion, citing threats from the United States to tax digital companies in France as another example. “This is not about a license to kill,” he said. “This is about having the possibility to counter coercion measures.” Bernd Lange, the chairman of the Parliament’s trade committee, said it was important to have a broad definition of economic coercion, citing threats from the United States to tax digital companies in France as another example. “This is not about a license to kill,” he said. “This is about having the possibility to counter coercion measures.”
The U.S. representation to the European Union declined to comment on the proposal.The U.S. representation to the European Union declined to comment on the proposal.