EU ‘protectionism’ risks a global backlash

Subject

EU protectionism.

Significance

The EU is seeking to promote externally its norms on green energy and digital commerce, as well as taking a firmer approach on foreign investment. However, the approach will likely be interpreted as protectionist by the bloc’s trading partners and could prompt retaliation across different policy areas.

Impacts

• UK absence from EU policy will mean the loss of a liberal voice both on trade policy and single market regulation.
• The EU will find it difficult to reform or even sustain WTO rules in the event of a second Trump administration.
• Increased tensions with trade partners could weaken the EU’s global influence in areas such as climate policy and technology regulation.
• Getting parliamentary approval for agreements with countries deemed to be pursuing climate-damaging polices will become much more difficult.