EU seeks to complete trade deals in two years

The European Commission hopes to complete bilateral trade agreements with South Korea, India and ten south-east Asian countries within two years at the latest, according to negotiating mandates for trade agreements which it is expected to adopt on 6 December.

The mandates, which will have to be approved by the member states, have been drawn up after extensive discussions with the countries involved. Officials say that South Korea in particular is keen to reach agreement quickly, hence the one-year timetable, while the negotiations with India and ten members of the Association of South-East Asian Nations (ASEAN) are expected to take two years. India has signed up to this timetable, an official said. The Commission fears that, without target dates for completion, talks could meander on inconclusively as they did with the proposed agreement with the four Latin American countries of the Mercosur trade bloc.

A senior Commission official said that while bilateral trade agreements in themselves were nothing new, the increased emphasis on bilateral deals did reflect new EU priorities.

Previously the Commission had soft-pedalled on bilateral trade agreements, fearing that pushing such deals might be interpreted as undermining the now deadlocked Doha round of trade talks within the World Trade Organization.

David O’Sullivan, Commission director-general for trade, warned recently that, if Doha was not restarted within months, it might be a decade or more before a new multilateral agreement could be reached.

Meanwhile bilateral deals are proliferating, not only between the US and its trading partners but also among developing countries themselves. The EU, said a senior official, could not afford to sit on the sidelines while other countries gained competitive advantages from bilateral deals, not least because this would tend to undermine support for free trade within the EU.

A senior EU official said that the new bilateral deals should be seen as part of the Lisbon Agenda, aimed at fostering EU competitiveness. The world, he said, had changed dramatically since the Doha talks were launched in 2001. Asian countries had emerged rapidly as key trade partners and much of global business was now structured around international supply chains. It was no accident that the new bilateral negotiations were with Asian countries, he said.

Officials also pointed out that trade barriers increasingly took the form of non-tariff barriers related to such issues as government procurement policies and product regulations, and the need to ensure fair competitive conditions and investment opportunities. Such issues had either not been central to the Doha talks or were removed from the Doha agenda early on.

• Trade Commissioner Peter Mandelson will next week launch a review of trade defence mechanisms such as anti-dumping duties and safeguard clauses. In a green paper to be approved by the Commission on 6 December, Mandelson will ask member states whether the current rules need changing to reflect that many European companies have outsourced production to third countries and so suffer from penalty import duties. The paper is designed to draw on the lessons of cases like the decision to impose duties on imports of shoes from Asia which divided member states. It will focus on the definitions of "community interest" and "standing", or whether groups of companies are representative of the industry as a whole.

The European Commission hopes to complete bilateral trade agreements with South Korea, India and ten south-east Asian countries within two years at the latest, according to negotiating mandates for trade agreements which it is expected to adopt on 6 December.