Growth in Europe has been mediocre and slower than in the US and Asia. As a result, Europeans fret over declining purchasing power. At the same time, the global order put into place after the Cold War is now increasingly fracturing under the pressure of renewed great power rivalry. For Europe, a trade-intensive economy that relies heavily on exports for economic growth, this is a particular concern. Europe’s response so far has been to help uphold as much of the WTO system as possible, while relying increasingly on unilateral regulations, and its status as one of the most important trading partners to many countries, to influence the development of regulatory standards overseas. But relying too heavily on regulation to set the agenda brings its own set of risks: it requires the EU to set more conditions on access to its own market. In doing so, it risks undermining EU openness and its importance as a trading partner, which is the reason why other countries follow its standards in the first place. There are increasingly signs that, in imposing these new conditions, the EU has gone too far.
Author: Aslak Berg, Research Fellow, Centre For European Reform.
This article is available on the CER website.
