The EU Trade Policy is an exclusive competence of the EU, meaning that only the EU, and not individual member states, has the authority to legislate on trade issues and conclude international trade agreements. The scope of EU’s Common Commercial Policy, as set out in Article 207 of the Lisbon Treaty, includes changes in tariff rates, trade agreements relating to trade in goods and services, foreign direct investments and the commercial aspects of intellectual property.
The main objectives of the EU Trade Policy are to essentially create growth opportunities for the European business community, by lowering barriers and providing better market access to third countries for EU exports and investments.
The EU has a leading role in promoting open and fair trade and supports the multilateral framework of rules and disciplines on international trade set out by the World Trade Organisation (WTO). Within this framework, the EU is currently engaged both in multilateral negotiations within the WTO, as well as in bilateral negotiations on trade agreements with major economic partners.
The Cyprus Presidency will take the lead in keeping up the pace in these negotiations, so that further progress can be made.
The Euro-Mediterranean Partnership was officially launched in 1995 with the “Barcelona Declaration”, aiming to establish a common area of peace, stability and prosperity in the Euro-Mediterranean region. The main objective of the trade partnership is to create a deep Euro-Mediterranean Free Trade Area, where trade in goods, services and investment, will be substantially liberalised.
The European Commission has recently been mandated to start negotiations for Deep and Comprehensive Free Trade Agreements (DCFTAs) with Egypt, Jordan, Morocco and Tunisia. DCFTAs will aim at progressively integrating the economies of these partners into the EU single market. Negotiations will start upon successful completion of the scoping exercises, which will determine each country’s readiness to proceed.
The launch of negotiations for a DCFTA, with one or more of the above Mediterranean partners, is possible during the Cyprus Presidency.
A study undertaken jointly by the EU and Canada in 2007, demonstrated that the liberalisation of their bilateral trade could provide substantial benefits for both sides.
Based on the above study, negotiations between the EU and Canada for an agreement that would deepen the trade and investment relations between the two parties were launched in May 2009. Both sides are committed to maintaining the rapid pace of the negotiations and it seems possible that negotiations could be completed by December 2012.
EU and China are currently investigating a number of options for deepening their bilateral investment relations. In this regard, a "Joint EU-China Investment Task Force" was launched in 2010 to explore the prospects for enhancing cooperation on investment.
One of the alternatives being considered is to negotiate a stand-alone investment agreement, in which case the existing Bilateral Investment Treaties between China and EU Member States would be replaced with a single agreement between China and the EU.
During the Cyprus Presidency, it may be possible to reach agreement for the launch of negotiations on an EU-China bilateral investment agreement, which will pave the way for increased investment flows between the two strategic partners.
Free Trade Agreements (FTAs) are designed to support trade liberalisation in goods and services and establish a more stable and transparent trading and investment environment. They are legally binding agreements, which can play an important role in supporting bilateral trade and creating business opportunities.
The launch of the negotiations for a FTA between the EU and Japan is projected to take place during the Cyprus Presidency. Negotiations will address all issues of shared interest, including tariffs, non-tariff measures, services, investment, intellectual property rights, competition and public procurement.
While the EU and the US enjoy the world's largest trade relationship (accounting for approximately a third of world trade), their bilateral trade relations still have great potential for growth.
At the EU-US Summit in November 2011, it was decided that a High-Level Working Group on Jobs and Growth would be created, with the aim of identifying mutually beneficial policies and measures which will boost transatlantic trade and investment and will support job creation, economic growth and international competitiveness.
The Working Group is expected to submit its proposals towards the end of 2012, among which there is a good possibility for a recommendation to initiate negotiations towards an EU-US Free Trade Agreement.
In 2009, the Council of the EU decided to support the opening of bilateral negotiations for Free Trade Agreements with Southeast Asian Nations (ASEAN). Singapore is the first ASEAN country with which negotiations have been launched. The negotiations are at an advance stage and it is expected that they could be completed during the Cyprus Presidency.
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