EU defends 'green' trade, but still wants to expand its free trade agreements

"We have to take responsibility for putting trade policy at the service of climate policy." This sentence was pronounced by Emmanuel Macron on Saturday, December 2 in Dubai, during COP28. Criticising the trade agreements of the 1990s, the French president called on the World Trade Organisation (WTO) to integrate climate issues "to align our trade regime with the Paris Agreement".

As is often the case on the international scene, Emmanuel Macron made an offensive speech for the climate cause at a COP that proposed for the first time in the history of these events a day dedicated to world trade.

In particular, he took as an example the efforts required of European industries to decarbonise their production and explained that it was no longer possible to allow the import of products from industries whose "production practices make no effort".

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Emmanuel Macron could have cited the recent free trade agreement between the European Union and New Zealand. According to Brussels, this so-called "new generation" trade agreement is a model of its kind: the European Commission insists on the "unprecedented commitments" on the environment contained in this agreement, which incorporates the clauses of the Paris Agreement, and ensures that imported food will have to comply with EU standards.

"Trade policy must contribute to our carbon neutrality objectives and we must find good levers to respond to climate challenges. This is what we have done with New Zealand and the integration, not only of the Paris Agreement, but also of sanctions in case of non-compliance with the clauses of the Paris Agreement," said French MEP Marie-Pierre Vedrenne (MoDem - Renew Europe), contacted by France 24.

"Rules that allow us to move in the right direction"

"There is indeed real progress: in the event of a serious violation of the Paris Agreement, there is a sanction mechanism and we can consider a suspension of the free trade agreement," Mathilde Dupré, co-director of the Veblen Institute, which promotes the ecological transition, told France 24. "But that doesn't cover everything," she says. Violations of the Paris Agreement are not well defined. And the very construction of the agreement and its architecture are in opposition to our climate commitments because this kind of agreement promotes trade in all sectors."

The impact assessment published by the European Commission does not say anything else: "Additional trade flows between the EU and New Zealand will lead to an increase in GHG [greenhouse gas] emissions from the transport of goods", but also because of "its impact on the volume of economic activity in the agricultural sector, in particular the meat and dairy sectors", sectors that are particularly high emitters.

"Of course, we have to ask ourselves the question of changing our consumption patterns and producing more in Europe, but we won't eliminate all trade and all trade," replies Marie-Pierre Vedrenne. So we need rules that allow us to move in the right direction. This agreement with New Zealand must be a new minimum standard for future free trade agreements."

See alsoEU-Mercosur agreement: free trade before climate commitments?

The problem is that in parallel with Emmanuel Macron's calls and the treaty with New Zealand that the European Union is proud of, Brussels is continuing its negotiations with Mercosur (Argentina, Brazil, Uruguay, Paraguay) to find an agreement after more than twenty years of discussions, to the detriment of environmental issues, according to its critics.

The draft free trade agreement between the EU and Mercosur is considered "obsolete" by many observers, who point to the shortcomings regarding social and environmental issues, and in particular with regard to the deforestation of the Amazon rainforest.

"For trade negotiations, the software has not yet been updated"

"The EU had made a shift after the Covid crisis by wanting to take into account sovereignty and climate issues in its trade agreements, but now there is a sense of panic among some, in the Commission and among the Member States, to want at all costs to conclude an agreement with Mercosur before China, but I say 'be careful', warns MEP Marie-Pierre Vedrenne. We need to get away from this ideology of wanting to conclude trade agreements no matter what it takes."

"The EU's trade policy is lagging far behind in aligning with its own climate commitments," Dupré said. Even though there have been significant shifts – regulation on imported products from deforestation, carbon border adjustment mechanism – for the major trade negotiations, the software has not yet been updated."

See alsoCETA and Mercosur agreements: is European agriculture in danger?

Professor at Sciences Po Rennes and author of the book "The European Union's Free Trade Agreements" (Larcier, 2023), Alan Hervé joins the criticism of the EU-Mercosur treaty, while stressing to France 24 the weight of lobbies.

"New Zealand is a small country that had a left-wing government at its head, more on the same wavelength as the Europeans, and was in a weak position to negotiate anyway," he said. Mercosur is not in the same situation. In addition, in Brazil in particular, there are very powerful lobbies that lobby not to integrate environmental constraints. On the European side, there is also a strong economic interest in moving forward. And besides, if France cynically brandishes the environmental issue to justify its opposition to the treaty, it is rather the agricultural issue that poses a problem."

Such an agreement would put French farmers in competition with Brazilian and Argentinian farmers, in particular, whose cattle are doped with antibiotics. This fear also applies to the agreement signed with New Zealand, where farmers can use products such as atrazine and diflubenzuron, two chemical substances deemed toxic and banned from use on European soil.

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