The new geopolitics means that national security, defence interests, economics, including business and trade, have become increasingly intertwined. Global trade tensions have intensified: The US has dramatically reshaped its trade policy, driving average applied tariff rates to their highest level in over a century. US action on Venezuela and Greenland show the merging of foreign policy with national economic interests. Amid this climate of escalating protectionism and stand-off between economic powers, the EU finds itself vulnerable, ill-equipped to join the global arena of sabre-rattling and strategic coercion, writes Christina Kaul.
The European Union is a rules-based construction. This is the only way a community of 27 member states can operate effectively. Its greatest achievement – the Single Market – operates based on common rules. Likewise, the EU’s external trade policy is rooted in its support for a rules-based global trade system, reflected in its commitment to the World Trade Organisation (WTO).
Europe’s prosperity and economy depend on international trade. Mario Draghi’s competitiveness report emphasises ‘sustainable competitiveness’ and ‘open strategic autonomy’. These objectives require a strong, innovation-driven industry at home, a fully functioning Single Market, coupled with access to international markets abroad. One cannot exist without the other.
The current disarray in global trade is not solely due to the new US Administration. In reality, this new fragmented world has emerged gradually over recent years: Trade barriers have been on the rise, export restrictions have become fashionable since the Covid-19 pandemic, the rules-based global trade system has been increasingly paralysed.
The world has changed, and the EU must become more assertive in pursuing its economic interests abroad. The EU cannot emulate the present US-style approach to trade defence and its aggressive pursuit of national economic interests. The EU must remain committed to promoting a rules-based international trading system but needs to rethink its overall approach to international trade.
There is much discussion following Mark Carney’s speech at the World Economic Forum in Davos, about ‘middle powers’ joining forces to revitalise the rules-based international trading system. For the moment middle powers one by one try to boost and diversify their bilateral trade relations. This also applies to the EU: The Commission is busy with concluding new bilateral trade agreements, see Mercosur, India and Australia, although one might argue some of it is lacking real substance and consistency on approach. But a comprehensive EU Trade strategy needs to be more than that.
Given that the Commission holds exclusive EU competence in trade, it must fully exercise this authority in all its aspects. More of a ‘Europe first’ approach is needed. Trade enforcement is of particular concern. The EU’s record on trade enforcement remains underwhelming: In 2024, the Commission registered 410 active trade barriers, and only 44 were resolved – less than 10%.1 Some 65 per cent have remained unresolved for over 5 years, and 27 per cent for more than a decade. This points to systemic deficiencies in EU enforcement and lack of resources.
In an increasingly polarised and politicised international trade environment, the EU has a clear interest in diversifying both its trade partners but also its industrial export base. Focus is with concluding new trade agreements but diversification of exports has not yet been addressed.
Research shows that concentrated, strategically aligned sectors are more successful in receiving EU enforcement support, while fragmented industries lack the institutional backing to trigger action.2 When it comes to politically sensitive issues, particularly in relation to health, a lack of consensus often leads to inaction. The result is a two-tier enforcement record: Such inconsistent treatment undermines the EU’s credibility as a defender of the WTO’s rules-based order and leaves entire export sectors without meaningful recourse.
Exporters of fast-moving consumer goods (FMCG), a highly fragmented but export-oriented sector, often face discriminatory foreign requirements that the EU challenges much less frequently. In effect, some goods and industries get more enforcement attention than others, leading to a selective pattern of enforcement. DG Trade’s database on trade barriers reflects this prioritisation of specific industries 3.
Symbolically sensitive products illustrate the problem – alcohol, in particular spirits producers continue to face discriminatory excise regimes in Malaysia, Peru, and Türkiye, with little follow-up. Despite preferential market access having been already agreed, restrictions for EU tobacco-related exports in Mexico but also in Brazil, Argentina, and Vietnam persist unresolved. Energy drinks, where the EU is a major producer, are struggling with market access in many countries around the world.
The EU needs to become more assertive in defending and promoting its EU standards: European Food Safety Authority (EFSA) opinions should serve as the explicit foundation of EU trade policy.
The EU needs to move towards a much more proactive and assertive EU Trade Enforcement agenda – one that makes defending European interests abroad a strategic priority. The Commission must rethink its approach to EU Trade Enforcement. This requires an honest evaluation of deficiencies in the delivery and management of resources. Effective enforcement is not just about fairness in trade; it is a cornerstone of Europe’s industrial competitiveness.
1 EU Commission (2025). Report from the Commission on the Implementation and Enforcement of EU Trade Policy
2 Van Ommeren et al. (2021). The European Union and the Political Economy of Enforcing International Trade Rules
3 EU (2025). Access 2 Markets: Trade Barriers