The EU’s measures on imported goods are facing criticism both explicit and implicit, and from both within and without.
A piece of research from the European Commission (EC) confirms complaints from overseas farmers that rules about pesticides for imported agricultural products will lead to significant food price rises.
Meanwhile, the US’ ambassador to the EU has issued a public criticism of Europe’s carbon border tax, accusing Brussels of a “double standard” on steel and aluminium.
US ambassador calls out EU CBAM
US ambassador to the EU, Andrew Puzder, has hit out at Brussels’ Carbon Border Adjustment Mechanism (CBAM) in an op-ed published in the FT, as trade tensions continue to simmer between the US and Europe.
Puzder claims that the EU CBAM, which levies a charge on high-polluting imports to ensure parity with environmental measures applied to domestic products, is a “tariff by another name”.
The ambassador compared CBAM’s coverage of steel and aluminum imports to the US’ decision to introduce tariffs on the same products to protect domestic industry under Section 232 of the Trade Expansion Act 1962, which he described as “a national security imperative”.
“Protesting against US national security measures while erecting protectionist barriers reveals a striking double standard”, Puzder wrote.
He compared the CBAM payment method of buying and then relinquishing carbon certificates corresponding to steel and aluminium emissions to the US’ “direct and transparent” approach of applying a 25% tariff rate to steel and its derivates, writing that “CBAM differs in form but not in substance”.
“At root, both policies are adjustments to protect domestic producers from unfair competition, whether from lax environmental rules or subsidised excess capacity.”
He concluded that Brussels’ criticism of US protectionism while continuing to roll out CBAM “erodes credibility”.
Brussels has yet to respond to the article.
Trade tensions
The op-ed follows ongoing criticism from Puzder and the Trump administration about EU regulations impacting American firms, including digital legislation.
Earlier this year Puzder called for talks between both parties about the EU’s Digital Markets Act (DMA) and other regulations that impact the US’ tech firms.
Designating the regulations “non-tariff trade barriers”, and said he hoped they’d be “able to break down some of these walls”, during talks – which never materialised.
In July, Brussels issued a fine totalling over US$1bn to Google for anti-competitive practices under the DMA, which US President Donald Trump claimed was “illegal and highly unethical conduct” in a social media post. He also threatened to levy “a substantial TARIFF”.
The tariff was never levied and, instead, the US administration’s Section 301 tariff rate between 10% and 12.5% lowers the import tax charged on many EU exports below the 15% charged under the EU-US ‘Turnberry’ trade deal, approved by Brussels earlier this year.
Environmental rules could limit EU agri-imports
Also unimpressed with Brussels’ environmental legislation: farmers exporting to the bloc.
Politico reports that research by the EC has corroborated farmers’ complaints that new rules banning foods with traces of hazardous pesticides will result in less products available and therefore higher costs for consumers.
The report by the EC’s Joint Research Centre found that coffee prices could rise by over 300%, while citrus fruits could be up by as much as 82%.
Food industry bodies from around the globe – representing Canadian grains, Californian almonds and Brazilian livestock – have claimed the rules could impact the livelihoods of workers in the sector, while trade experts have said that the legislation could be seen as imposing domestic standards on foreign producers in breach of international law.
Tensions have flared across a number of EU members states in recent years as farmers protested the progress of EU trade deals with counterparts known for agricultural exports, such as the South American trade bloc Mercosur and Australia.
Funding concessions were required to get the former over the line, while the latter also raised concerns among farmers owing to concessions on staple Australian agri-exports.
Elsewhere in the headlines
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Yesterday in Trade
- The EU’s Entry/Exit System has been criticised following claims that its introduction has doubled wait times at some airports
- Trump’s counter-demands for Iranian reparations following Tehran’s statement challenged progress in ceasefire talks
- The UK Trade Remedies Authority issued a notice on imports of Chinese, Mexican and South Korean suspension polyvinyl chloride (S-PVC)
