The European Union (EU) is the largest trad-ing block in the world. While EU trade policy is an exclusive EU competence that seeks to create jobs and generate economic growth, it has evolved over the years to support changing policy priorities in the Union’s external action. Thus, economic and social development have become interdependent and mutually rein-forcing components of the EU’s long-term sus-tainable development ambitions. As foreign governments increasingly count on protection-ist measures to curtail trade, the EU’s ambition to use trade policy as a tool for the promotion of “European principles and values” (1) becomes more important than ever. The ongoing COVID-19 crisis has led to a stagnation of global economic growth with estimates suggesting a contraction of the global GDP by up to 5,2 per cent. (2) In this context, the economies of devel-oping countries are predicted to suffer the most. The EU, with its commitment to multilateralism, free trade, and the promotion of social stand-ards, should lead efforts to tackle these chal-lenges in times of great economic uncertainty.
The EU manages its global trade relations with 72 countries through 41 existing trade agreements. Though these agreements vary in scope, they all abide by the principles of the World Trade Orga-nization ( WTO). Free Trade Agreements ( FTAs) grant preferential market access through recipro-cal market opening for developed countries, such as the Republic of Korea (hereafter South Korea), and emerging economies, such as the Socialist Republic of Vietnam (hereafter Vietnam). FTAs currently cover more than a third of EU trade, which could increase to two thirds if all ongoing negotiations are successfully concluded. (3) The new generation of EU preferential trade agree-ments seeks to encourage the establishment of stronger, values-based regimes by including dedicated Trade and Sustainable Development ( TSD) chapters in all comprehensive trade agree-ments since 2014.
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(1) European Council 2019: EU trade agreements, 26 Nov 2019, in: https://bit.ly/3lTy53e [16 Oct 2020].
(2) The World Bank 2020: Global Economic Prospects, Jun 2020, p. 3, in: https://bit.ly/2HbEU0M [16 Oct 2020].
(3) Damen, Mario / Igler, Wolfgang 2019: Free trade or geo-economics? Trends in world trade, European Parliament: Policy Department for External Relations, In-Depth Analysis, 27 Sep 2019, p. 23, in: https://bit.ly/2SZGAxc [16 Oct 2020].
