(S,P) The EU has in place the largest trade network in the world, with 45 applied trade agreements covering 77 partner countries. Learn how to tap into free trade.
The 4th Annual Report, which covers the period of 1 January-31 December 2019, covers 36 major preferential EU trade agreements which applied for a substantial period in 2019 with 65 different partners.
Despite tensions in the global trade arena, the report shows that EU trade agreements continued to facilitate fair and sustainable trade and solidify the framework of international rules.
Trade with the 65 preferential partners covered in the report grew by 3.4% in 2019, while the EU's total external trade grew by 2.5% overall.
The EU's trade agreements with Canada and Japan have especially boosted trade, by nearly 25% and 6%, respectively, since their entry into force.
The EU's trade agreements cover a third of the bloc's external trade with third countries and were worth €1,345 billion in 2019, according to the report.
The agreements contributed €113 billion to the EU's overall trade surplus of €197 billion and proved particularly important for European SMEs that trade outside the EU – whose number grew by an average of 6% between 2014 and 2017.
In a nutshell, the 2019 report shows:
EU agri-food exports to trade partners increased by 8.7% compared to the previous year. Exports of agri-food products to Japan even rose by 16%.
EU industrial goods exports grew from +1.9% in 2018 to +3.7% in 2019. The top three categories, including machinery, chemicals and transport equipment, saw growth rates of 1.5%, 6.3% and 5.7%, respectively. EU exports of machinery and pharmaceuticals to Canada saw impressive growth of 15% and 18%, respectively.
In addition, the report looks in more detail at the first year of implementation of the EU-Japan Economic Partnership Agreement and shows that the agreement:
boosted bilateral trade in goods by 6% across all sectors compared to 2018;
particularly favoured EU exports in categories with big tariff cuts, such as textiles, clothing and footwear, which grew by 10% on average, and;
supported a 16% surge in EU agri-food exports, which make up 12% of total EU exports to Japan.
The report also shows that in 2019, during its second year of entry into force, the EU-Canada agreement (CETA):
increased bilateral trade by almost one quarter (24.5%) compared to pre-CETA trade between 2015-2017;
helped industrial goods like machinery and pharmaceuticals increase by 15% and 18% over the past year alone, and;
moved Canada up from the 9th to the 8th largest market for EU agri-food exports. Increased access to the Canadian market under CETA tariff-free quotas saw the value of EU cheese exports to Canada increase by 15% in 2019, compared to 2018.
What is the Commission doing to improve the uptake of EU trade agreements’ preferences?
The Commission is strengthening its communication and outreach on new and existing trade agreements, including the development of dedicated guides facilitating the use of tariff preferences. Recent examples include
• A Guide on Rules of Origin in CETA9 and a fact sheet on textiles and clothing10 • A Guide on Rules of Orgin in the EU-Vietnam Free Trade Agreement
• Guidance on Rules of Origin in der EU-Japan EPA and SME Helpdesk
The Commission on 13 October launched its new portal “Access2Markets” (A2M), which provides information on 120 export destinations and sourcing conditions for all non-EU markets. Companies can pull up information on key aspects like tariffs, internal taxes, rules of origin, customs procedures and product requirements, trade barriers and trade flows. ‘A2M’, through its new ‘RosA’ (Rules of Origin Self Assessment) tool, also responds to stakeholder requests for clearer and more comprehensive information on the applicable rules of origin. Companies will be able to assess whether they fulfil rules of origin requirements to benefit from preferential duties. This should help companies, in particular smaller ones, to access key information on how to unlock the preferences and benefit from the agreements. A2M contains a static overview of most EU preferential trade agreements (including their Rule of Origin chapter).
The Commission/DG TRADE is also preparing the introduction of a Single entry point (SEP) for stakeholders’ complaints regarding market access barriers in non-EU countries, as well as on the implementation of labour, environment or climate provisions in trade agreements. This new centralised complaints procedure will streamline the Commission’s response to market access barriers and possible breaches of trade and sustainable development commitments.
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