The European Union-United States trade
and investment relationship remains the world’s most intensive even
after Brexit. Trade between the U.S. and the EU (minus the United
Kingdom) totalled around $1 trillion in 2018, about a third larger than U.S. ties with China. EU27/U.S. bilateral FDI stocks surpassed $4.5 trillion,
dwarfing those with China. Despite the frequently differing positions
of EU members on trade policy, the EU-U.S. relationship stood the test
of time and continued to deepen. But, over the last four years,
President Trump’s strictly transactional approach to trade policy, with
an obsessive emphasis on reducing bilateral deficits, has amounted
essentially to managed trade and is diametrically opposed to the
principle of non-discrimination enshrined in multilateral trade
disciplines, which Americans and Europeans worked together to establish.
There is little doubt that a Biden
Presidency would mark a toning down of EU-U.S. tensions and a return to
civility. Attitudes across the Atlantic will converge again in important
areas such as climate change. Surprisingly, voters who identify as Democrats are far more likely than Republican voters to support open trade, even though that is not the case in the U.S. Congress.
Although Biden appeals to many in the
rust belt and has supported steel tariffs in the past, the present
tariffs on steel and aluminium, based on Section 232
(national security), are hardly compatible with rebuilding alliances. A
way will be found to eliminate them or replace them with other
mechanisms. The threat of auto tariffs, which are widely opposed anyway,
is certain to fade. Biden, of Irish ancestry, has said that a trade
deal with the U.K. should be conditional on preserving peace on the
island of Ireland in line with the Good Friday Agreement. This is
generally seen as requiring a continued open border between Northern
Ireland and the Republic of Ireland, in keeping with the U.K.’s
withdrawal agreement from the EU.
Read more at:
What Should Europe Expect from a Biden Trade Policy? – BRINK – News and Insights on Global Risk
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