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13th Dec 2019

Hogan sets out trade plans at commissioner grilling

  • Agriculture commissioner Phil Hogan has been involved in EU trade negotiations before (Photo: European Commission)

The US needs to realise its common interests with the EU, be tough on China, and defend the multilateral rules-based trade - that is what Ireland's Phil Hogan, poised to be in charge of EU trade for the next five years, told MEPs at his grilling on Monday evening (30 September).

The current agriculture commissioner fielded questions from EU lawmakers for two-and-a-half hours. He is expected to be approved by the relevant committee.

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Trade has become a political focal point in recent years, with trade deals having divided voters, China competing unfairly according to critics, and the US administration fuelling a global trade war.

Brexit will also add to the bulging portfolio, as the EU and the UK will need to work out a trade deal after Britain leaves the block.

Hogan said he would work towards a more balanced and more mutually-beneficial relationship with the US, but that Washington needs to realise its mutual interests with the EU and shared concerns on China.

"It takes two to tango," he said, adding that he wants to build on the agreement reached between US president Donald Trump and EU commission president Jean-Claude Juncker in July 2018, when the bloc avoided tariffs on car imports threatened by Trump.

"Unfortunately we have not seen much movement on that agenda since then," Hogan said.

Washington and Brussels agreed to negotiate a deal to remove tariffs on industrial goods, but the talks have come to a deadlock as the US insists that agricultural goods must also be included, which the EU has ruled out.

But Hogan also said the EU should not lose sight of the "big picture".

"We trade €3bn a day with the United States and the EU-US relationship remains the largest and deepest economic relationship in the world," Hogan said.

"I'm committed to working on a positive transatlantic agenda," Hogan added.

MEPs quizzed Hogan on the impending US tariff on EU goods, following a World Trade Organisation (WTO) ruling on subsidies rearing the European aircraft manufacturer Airbus.

He cautioned saying "let's see what the extent of the decision will be in the form of retaliation, then we will have to evaluate it," but also added: "The EU needs to stand up for itself".

He recalled that a similar WTO decision is expected on US firm Boeing, making any US move on tariffs counterproductive, as the EU would also draw up a list of US products to be targeted by tariffs.

Hogan pointed to a July deal on importing more beef from the US, which he said is an example of the EU's willingness to solve problems through dialogue.

Hogan also pledged that he will do his "utmost to prevent the collapse of the WTO dispute settlement mechanism".

There are fears the WTO's main trade arbitration body will fail because the US has been blocking the appointment of judges.

He said the organisation needs to be reformed to maintain a global trade based on rules rather than the law of the jungle.

Hogan said he wanted to strengthen the rules on forced technology transfers, a level playing field, subsidies and transparency.

China

Hogan said, in a nod to France which initiated the tool, the EU should strengthen its investment screening program, aimed at checking investors, especially from China if strategic assets are at stake.

"I would like to see a coordinated and harmonised approach," Hogan said of EU countries, adding that "beefing up the screening mechanism is essential if we want to protect our critical technologies and our critical infrastructure."

The current system allows for an exchange of information among member states that have decided to participate in the scheme.

Hogan also vowed to press ahead with reciprocity in public procurement, meaning that Chinese companies should not be able to bid in EU public tenders if Beijing does not open its markets to EU firms.

Amazon

Hogan defended the EU's trade deal with South American countries Argentina, Brazil, Paraguay and Uruguay, following criticism from MEPs that Brazil's president Jair Bolsonaro's policies contribute to the Amazon fires.

France and Ireland have said they would not ratify the Mercosur trade deal unless Brazil does more to fight fires in the Amazon.

Hogan said that the deal itself was the leverage, and the only EU leverage, that made Bolsonaro soften his Amazon policies.

Hogan was less convincing on protecting labour standards. "I very much strongly support the use of trade and trade instruments and trade policy," he said.

Brexit and beyond

Even though the Irishman would be in charge of a post-Brexit trade negotiation, there was little time spent on the UK leaving the EU at the hearing.

"It is very hard to know what direction the UK will go because they can't seem to get a deal through the House of Commons," Hogan said, avoiding a question on what a future trade deal would look like.

He said the negotiating red lines of EU countries, and the parliament, such as level playing field, consumer protection, and standards, would be protected.

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