How can trade contribute to growth and jobs? The role of EU trade policy Signe Ratso Director...
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Transcript of How can trade contribute to growth and jobs? The role of EU trade policy Signe Ratso Director...
How can trade contribute to growth and jobs?
The role of EU trade policy
Signe RatsoDirector Directorate General of TradeEuropean Commission
Outline
• Trade and growth
• Trade and jobs (new studies on factors contribution to trade)
• Greek exporters (firm level data)
• Trade policy
• Market access strategy2
Trade is a source of growth…•Growth in EU depends on global growth:
•EU countries can benefit from the emergence of new economic powers (Brazil, India, China and Russia) 3
…and trade supports jobs
• In 2007, extra-EU exports supported around 25 million jobs, which represented around 11% of total employment in the EU27.
• This represents an increase of 3 million export-related jobs since 2000.
4
…but in Greece less than in other countries
Employment supported by extra-EU exports as a percentage of total employment (2007)
5
- In Greece, in 2007, the sales of goods and services to the rest of the world supported the jobs of 128.000 people, which represents only around 3% of total employment.
- Moreover, (and contrary to what happen in the EU as a whole), the contribution of trade to job creation has decreased. In 2000, the jobs of 231.000 Greeks were supported by extra-EU exports.
•
6
Many factors contributed to this:
• Greece exports tend be more oriented towards extra-EU markets than the EU average but…
• the share of exports over GDP remains well below that of other (comparable) small EU Member States (for example Belgium)…
• while Greek exports have become less labour intensive than the EU27 average
7
Member States
Embodied employment in
Extra-EU exports (1,000
employees)
Employment shares
(%)
Embodied employment per million € of extra -EU
exports
Extra-EU exports
shares over total exports
(%)
Total exports shares
over GDP (%)
Extra-EU exports shares
over GDP (%)
2000 2007 2000 2007 2000 2007 2000 2007 2000 2007 2000 2007
Belgium 344 356 8.4 8.1 9.0 7.6 24.8 23.7 61.2 59.3 15.2 14.0
EU27 22,000 25,020 10.5 11.2 19.8 15.4 100.0 100.0 12.1 13.1 12.1 13.1
Greece 231 128 5.9 3.0 21.6 9.2 49.0 42.1 15.8 14.7 7.7 6.2
Looking at micro-data: many Greek firms are exporters….
02
04
06
08
01
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(%
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27 B
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8
….but they sell abroad only a small fraction of their output
02
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.e.c
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19 L
ea
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The average export share is 30% (export revenue/turnover of exporters; non-exporters are not included)
9
The weaknesses can be the basis of future export growth:
• The prevalence of marginal exporters can explain the disappointing export performance in manufacturing.
• On the positive side: marginal exporters can turn to foreign markets more easily than firms that have never exported.
• this process can lead to a long-term successful expansion of the export sector only if the bigger firms are involved
10
11
Trade and investment policy – how we engage with our partners
Bilateral agreements(mainly Free Trade Agreements)
Multilateral policy(WTO/DDA)
Market Access Strategy
Our trade strategy
11
Bilateral agreements – state of play12
Mexico
EFTA
Turkey
SAA
Caribbean ACP
Chile
South Africa
Columbia/ Peru
South KoreaEuro-MedCentral America
Agreements in force Negotiations concluded 12
Bilateral agreements – the way ahead13
Japan
Russia
Other ASEAN
Eastern Partners
Pacific EPAsMalaysia
India
Singapore
Mercosur
Euro-Med
Canada
Gulf countries
Ukraine
African EPAs
EPAs: Economic Partnership Agreements with ACP countries
Euromed: Forthcoming negotiations on deep and comprehensive Free Trade Agreements
Russia: Commitment to negotiate a Free Trade Agreement already contained in the Partnership and Cooperation Agreement of 1997
Negotiations ongoing
Negotiations under consideration
USA
13
The example of the EU-South Korea Free Trade Agreement
• 1.6 billion Euros in customs duties saved per year
• Creates new trade opportunities (after full implementation the EU is expected to increase goods and services exports by nearly 20 billion Euros)
• Access for service suppliers
• Tackling non-tariff barriers
• Enhanced access to government procurement
• Protection of intellectual property
• Strong competition rules
• Commitment to sustainable development
14
Market Access Strategy
• Cooperation between Commission, Member States and business to identify, analyse and remove barriers
• Importance of preventive action (“early warning”)
• 200 key barriers identified in more than 30 markets (publicly available on Market Access Database)
• Around 50 “success stories” per year• Strong focus on SMEs• Market Access Committee, sectoral
Market Access Working Groups and Local Market Access Teams 15
Local Market Access Teams• In more than 30 third countries• Local knowledge of the situation by EU
Delegation, Member States Embassies and business representatives
• Early warning function: easier to address potential barriers
• Assessment of the likely economic impact of market access barriers
• SME contact points available soon
16
Trade finance
• There is potentially also a liquidity crisis that is currently affecting trade conducted on an open account basis.
• Task Force for Greece and other MSs' Export Credit Agencies are considering solutions.
17
Conclusions
• The growth outside the EU is a great opportunity for EU countries: demand for exports and sources of investments.
• DG TRADE is actively pursuing new opportunities for EU firms (both through multilateral fora and bilateral negotiations and Market Access Strategy)
18