Why Trade Is the European Union’s Best Foreign Policy Asset

Written by Antoine Latran

Introduction

There has been a number of debates over the years on the European Union’s place in the world. Despite France’s President Emmanuel Macron calls for a more coordinated Europe in terms of defence and military policies, the EU has never been a formal military power, as its inaction during various military conflicts proves. Despite the divisions within the Council on foreign policy issues, the European Union has found a way to implement its foreign policy through trade. By signing free trade agreements and schemes of preferences, the Union has a myriad of options to exert a global influence in the world.

In this column, French student Antoine Latran tries to explain why trade is and should be, Europe’s most effective asset weapon in terms of promoting its foreign policy. 

Normative Power: How the EU Shapes International Norms Through Trade

Normative Power is a concept established by Ian Manners in 2002. According to him, there was a gap in the literature regarding the European Union, as the division between “civilian power” and “military power” was inaccurate. He argued that the existing literature tried to describe the European Union with theoretical concepts usually related to states; which the EU is not.

The notion of Normative Power was, in Manners’ view, a notion more inclined to the EU’s nature and purpose: the diffusion of common regulations, ideas, and norms. In his own words, “the reinforcement and expansion of the norms identified have allowed the EU to present and legitimate itself as being more than the sum of its parts.” In other words, norms bring all European national economies together under the EU flagship. The normative power of Europe is in consequence fairly simple: made out of 27 countries and home to more than 300 potential consumers for foreign brands, the European Union is an attractive market for any firm. Foreign countries understand this and try to access this gigantic market through the use of foreign trade agreements. 

This normative power brings leverage to the European Union in the negotiation table, especially against smaller economies such as Singapore, with whom the EU recently signed a trade agreement. Through this leverage, the European Union has the power to bring in conditionalities like clauses on political regulations regarding the protection of human rights or the respect for the rule of law (Young, 2015). It has done so increasingly since the Treaty of Lisbon in 2009, as the European Parliament has gained more power, especially on environmental and labour issues (Rosén, 2017). Now that the EP has the power to veto these agreements, it makes sure that the Commission, which is in charge of negotiating trade agreements, issues some conditionalities to diffuse the values of the EU.  

These political conditionalities are key to the European Union and its foreign policy as they give incentives to the countries it is negotiating with to increase the rule of law, to comply with the Paris Agreements on climate change or to strengthen laws on human rights and child labour (Young, 2015). These clauses also bring an opportunity for the EU to modify domestic policies and regulations of target countries without having to openly interfere through political discourses and official declarations. Rather, it is all done behind closed doors, rarely catching the attention of the media. 

The political leverage of these conditionalities brings in exchange two benefits to the European Union. Firstly, by spreading norms through trade, the EU avoids having the reputation of an interventionist power, as opposed to the United States. The European Union has always had a rather “friendly” image, supported by privileging this diplomatic and indirect way of shaping countries’ regulations through norms. Secondly, by ensuring that countries with access to the European market are committed to sustainable development, European firms face less competition. Indeed, if foreign products are made respecting EU environmental regulations and working conditions, they are produced in a way that is closer to how European companies operate, making unfair competition less common.

This way of exporting norms through trade agreements has also led researchers to describe the EU as a regulatory power: “The main output of the Brussels machine rules that govern trade and that set standards for consumer protection, for the environment, for competition, etc. If the power to make rules is power than Brussels, in a modest way, is also a power.” (Cooper,2012) 

Considering the European Union’s past as a primarily economic union, it makes sense that the EU puts forward its foreign policy through economic measures in order to influence other countries’ regulations. The EU was built in part to become an economic organisation for cooperation, which is why the Commission and alike institutions have a limited sphere of action, especially in foreign policy, where member states tend to prefer using national institutions to make decisions. Therefore, as trade is an exclusive competence of the European Union, it chose to diffuse the norms and values of the EU by using the very purpose of its existence: the common market. 

Antoine Latran is a postgraduate at the University College London, in a MSc in European Politics & Policy. Antoine previously worked as a journalist in France, the United Kingdom and more specifically in Argentina at The Bubble, in charge of describing the European investments in the country. Passionate about the study of trade and the way the EU diffuse regulations through economical exchanges and foreign policy, he hopes to write extensively about EU strategies on these fields. Fluent in English, French, Spanish and Italian, Antoine is looking to get at the ESTT his first experience in the think tank world

References

Manners, I. (2002). Normative Power Europe: A contradiction in terms ?. JCMS, 40(2), 235-258. 

Young, A. (2015). The EU as a global regulator? Context and Comparisons. Journal of European Public Policy, 22(9).

Rosén, G. (2017). The impact of norms on political decision-making: how to account for the EP’s empowerment in EU external trade policy. Journal of European Public Policy, 24, 1450-1470.