Free Trade Agreements
The Communication "Global Europe: Competing in the World" from 2006 sets out that trade policy can contribute to creating growth and jobs in Europe. It argues that our openness to others, and their openness to us, are critical and mutually reinforcing factors in European competitiveness.
Traditionally, barriers to trade were addressed mainly through reductions in tariffs. But to create open markets in the 21st century, Europe needs to look beyond tariff reduction to the trade barriers that lie behind borders. As tariffs fall, these barriers - such as restrictive regulations or standards - become increasingly important. There is therefore a need to step up our engagement with the major emerging economies, particularly in Asia, where there is potential for growth.
This is why the European Commission proposed a new generation of competitiveness-driven bilateral free trade agreements with key partners, in which economic criteria is a primary consideration. The Commission will ensure that these agreements are a stepping stone for future liberalisation, not a stumbling block, by building on the WTO: tackling issues which are not ready for multilateral discussion and by going beyond the market opening that can be achieved in the WTO.
EU-Chile Association Agreement
Negotiations on the EU-Chile Association Agreement were concluded in 2002. The Agreement covers the main aspects of EU-Chile relations, i.e. political, trade and co-operation. The trade provisions of the agreement entered into force on an interim basis on 1 February 2003. The Agreement entered fully into force on 1 March 2005, after ratification by all signatory parties.
EU-Korea Free Trade Agreement
The Council authorised the Commission in April 2007 to negotiate a comprehensive Free Trade Agreement with the Republic of Korea, with two main objectives: to reciprocally liberalise all trade in goods and services and to tackle existing and future non-tariff barriers to trade.
In May 2007, negotiations were launched in Seoul. After eight rounds of talks, the negotiations have been completed and the agreement has been initialled on 15 October 2009. On 9 April 2010, the Commission adopted a proposal for a Council Decision authorising the signature and the provisional application of the FTA - see COM(2010)136.
The agreement was signed on 6 October 2010, approved by the European Parliament on 17 February 2011 and ratified by the Korean National Assembly on 4 May 2011. It provisionally entered into force on 1 July 2011.
EU-Mexico Economic Partnership, Political Cooperation and Cooperation Agreement
Mexico was the first Latin American country to sign a partnership agreement with the EU (in 1997). The Agreement, called the EU-Mexico Economic Partnership, Political Coordination and Cooperation Agreement, entered into force in 2000 and has considerably strengthened bilateral relations between the EU and Mexico. The Agreement has established a Free Trade Area (FTA) between the EU and Mexico that has enshrined their bilateral trade relations in a preferential framework and has helped to enhance their bilateral economic ties.
EU-South Africa Trade, Development and Co-operation Agreement (TDCA)
The EU and South Africa signed the Trade, Development and Co-operation Agreement (TDCA) in Pretoria on 11 October 1999. The Agreement covers five areas of co-operation: political dialogue, development co-operation, co-operation in trade and trade related areas, economic co-operation and co-operation in other areas. The TDCA establishes preferential trade arrangements between the EU and South Africa, along with the progressive introduction of a free trade area. The TDCA's trade-related articles were provisionally applied since January 2000. The Agreement fully entered into force on 1 May 2004 after ratification by all signatory parties.
FTA in negotiations
EU-ASEAN - Free Trade Agreement
In April 2007 the Council adopted a mandate for the European Commission to start Free Trade Agreement negotiations with ASEAN countries (Burma - Myanmar, Brunei, Cambodia, Indonesia, Laos, Malaysia, Philippines, Singapore, Thailand, Vietnam). The European Commission decided to go for a regional approach on the ASEAN negotiations. In May 2007 the EU-ASEAN economic ministers meeting in Brunei agreed to enter into negotiations for a Free Trade Agreement.
Seven negotiations rounds were held with the ASEAN. At the last round in March 2009, both sides agreed to take a pause in the negotiations in order to reflect on the appropriate format of future negotiations.
In spring 2009 the Commission presented a report on the EU-ASEAN negotiations. In this report the EU underlined its intention to remain engaged with the region. It was announced that EU should be ready to engage in bilateral FTA negotiations with individual ASEAN countries. Such bilateral FTAs could constitute "building blocks" that the EU and the ASEAN may wish to consolidate in due course into a region-to-region agreement.
In 2010, negotiations with Singapore and Malaysia were launched.
EU-Canada Comprehensive Economic and Trade Agreement (CETA)
At the June 2007 EU-Canada Summit, leaders agreed to carry out a joint scoping study to lay the foundation for a future trade agreement. The conclusions of this study, which was presented at the October 2008 EU-Canada Summit, persuaded the leaders to agree to begin negotiations on a Comprehensive Economic and Trade Agreement. Negotiations began in October 2009 and have both an ambitious timescale, both sides aim to complete negotiations within two years, and an ambitious scope.
As well as addressing tariff issues and investment, negotiations aim to address the non-tariff barriers arising from differences in regulation and to strengthen regulatory cooperation. This is the most ambitious attempt yet to reduce non-tariff barriers between two mature economies. One major difficulty which beset previous negotiations of this type appears likely to be overcome as for the first time Canadian Provinces and Territories, which have substantial regulatory powers, are fully associated with the negotiations.
The eighth round of negotiations took place in Brussels on 11-15 July 2011. The next round is scheduled for Ottawa in October.
EU-GCC Free Trade Agreement
In 1991 the Council authorised the Commission to negotiate a Free Trade Agreement with the countries of the Gulf Co-operation Council (GCC), i.e. Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. The conclusion of such agreement was made conditional upon the establishment of a customs union among the GCC member states.
In December 2001 the GCC Heads of States decided to advance the entry into force of a GCC Customs union to January 2003 and to simplify the Common External Tariff to two groups: products that are exempted of duties and products with 5% duty. This decision encouraged both parties to proceed more rapidly in the negotiations. The common External Tariff is in effect since 1st January 2003 with some exceptions (linked to transitional periods and to a list of prohibited products).
The intention is for the agreement to cover all areas of trade relations; notably industrial, fisheries and agricultural goods.
EU-India Free Trade Agreement
The Council authorised in April 2007 the Commission to negotiate a comprehensive Free Trade Agreement with India. The negotiations were launched in June 2007 and are still in progress. Two main objectives are: reciprocally liberalising all trade in goods and services and tackling existing and future non-tariff barriers to trade.
During the last EU-India Summit, held on 10 December 2010, it was aggreed to intesify the negotiations with a view to concluding them swiftly. Many intersessional meetings have taken place. The next negotiation round is planned after the summer.
EU-Malaysia Free Trade Agreement
The negotiations were launched in October 2010. Negotiators met for the first round of negotiations in Brussels in December 2010.
The fourth round of negotiations took place in Kuala Lumpur on 12-15 July 2011.
EU-Singapore Free Trade Agreement
Singapore is the first ASEAN country with which the EU launched bilateral FTA negotiations. The first negotiating round took place in Singapore in March 2010.
The seventh round was held in Singapore in June 2011.
EU-Ukraine Free Trade Agreement
Negotiations on a comprehensive new EU-Ukraine agreement began in 2007. Originally referred to as the "New Enhanced Agreement", it will cover all aspects of the EU-Ukraine relationship, including a particularly ambitious free trade agreement (FTA). At the EU-Ukraine summit held on 9 September 2008 it was agreed that the new agreement wouldl be an Association Agreement. Negotiations on the FTA aspects began immediately after Ukraine's accession to WTO, in February 2008.
Negotiating an EU-Ukraine FTA is part of the EU's wider policy of creating a stable and prosperous European neighbourhood through closer economic ties. The EU is Ukraine's largest trading partner and closer economic ties offer major benefits for both parties. The ambition is for a deep and comprehensive FTA, going far beyond WTO rules, which will not only include significant reductions in tariffs but also a high degree of regulatory approximation. The removal of non-tariff barriers through regulatory alignment, including effective enforcement, will be the most important way in which the two markets can be integrated.
The seventeenth round of negotiations took place in Kiev in June 2011.
Association agreements with FTA component
EU-Central America regional Association Agreement and EU-Andean Community regional Association Agreement
A decision was taken at the Vienna EU-Latin America and Caribbean Summit, held on 12-13 May 2006, to open negotiations for an Association Agreement between the EU and Central America and for an Association Agreement between the EU and the Andean Community. Negotiating mandates were given to the Commission by the Council on 23 April 2007.
The EU and Central America have concluded the negotiations for an Association Agreement in May 2010. After its legal review, the text was initialed in Brussels in March 2011. This Association Agreement includes a comprehensive trade pillar which is expected to enter into force during the first half of 2012.
Negotiations between the EU and the Andean Community for a region-to-region Association Agreement were suspended in June 2008.
In Jauary 2009, the trade negotiations between the EU and three Andean countries – Colombia, Perú and Ecuador - restarted, aiming at a Multiparty Trade Agreement. After nine rounds of negotiations a successful conclusion was reached with Columbia and Peru in February 2010. The trade agreement is expected to enter into force during the mid 2012.
Although Ecuador and Bolivia decided to suspend their participation in the negotiations, the agreement preserves its region-to-region approach allowing other Andean Community countries to negotiate their accession to the agreement. Discussions are ongoing with the Ecuadorian authorities to look into ways of resuming negotiations. Contacts are also maintained with Bolivia.
EU-Mercosur regional Association Agreement
At the EU-Latin-America Summit held in Rio de Janeiro in June 1999, the Heads of State and Government decided to launch negotiations on Association Agreements with Mercosur and Chile. In September 1999, the Council adopted negotiating directives, which allowed the Commission to start negotiations with Mercosur in April 2000. The parties agreed that the target date for the conclusion of these negotiations was to be 31 October 2004. This target was missed and the negotiations were suspended.
Negotiations were re-launched at the EU-Mercosur Summit in May 2010. The sixth round of negotiations took part in Brussels on 4-8 July 2011. The next round is scheduled in Montevideo on 7-11 November 2011. Until now negotiations have focused on the "normative" part of the agreement. Both sides are also working internally on the preparation of their market access offers, but no date has been agreed for the exchange yet.