Advocating for openness, a rules-based system and multilateralism

In Buenos Aires this year, we will mark the 10th anniversary of the G20 summit. The European Union has an obligation to take on its responsibilities in the world, and to be able to shape the global agenda. We may be a geographically small continent, but the European Union is the second biggest economic power at the G20 table, representing 21.4% of total global gross domestic product, and only the leaders of China and India represent more citizens at the G20. But however powerful we are individually, our planet belongs to every citizen living on it, not just the biggest and strongest, or those most able to impose their wishes on others. This is why the multilateral approach is the fairest and most democratic way of governing and acting at a global level, and why the European Union will remain the leading global advocate of multilateralism.

Our world must be an open and rules-based world, sharing common principles and values. It is only in this way that we can reduce inequalities, develop fair trade, eliminate poverty and create jobs and opportunities for everyone. Multilateralism is also the only way to preserve our planet.

Our commitment to multilateralism includes a strong commitment to the G20. In the aftermath of 2008, the concerted actions of the G20 members to stimulate their economies and refrain from protectionist measures were crucial to avoid another Great Depression. This shows that only through working together can we solve the challenges of our fast-changing world, and ensure stability and continuity in global governance and the economic and financial systems we have come to depend on for our security and prosperity.

In recent years, the multilateral system has been put into question by growing economic and geopolitical tensions. The time has therefore come for Europe to play its full role internationally, and I will continue to work tirelessly to strengthen Europe’s role on the global stage. This applies to our work on climate change, on security, on the technological revolution of artificial intelligence and robotisation, and, perhaps most importantly, on reforming the global trading system. European sovereignty means that we harness our combined weight to shape the international order; it does not mean that we turn our backs on the world.

For the European Union, trade means jobs. For each €1 billion of EU exports to the rest of the world, we support 14,000 jobs. The European Union will continue to set a positive agenda on trade, harnessing the power of global markets to improve standards of living for all Europeans. Where others hesitate on global trade, we will step forward. But we also acknowledge that the global system needs updating, and that means reforming and modernising the World Trade Organization (WTO). There is momentum building, and we will work constructively with all our international partners to deliver these reforms.

At its Charlevoix Summit in June, the G7 reached consensus on the need to modernise the WTO and make it fairer as soon as possible, and the European Commission has received a mandate from national leaders to work on these reform proposals. We want to develop new rules in the field of industrial subsidies, intellectual property and technology transfers, and we will look to create a more effective and transparent dispute settlement process and body within the WTO. This, and other reforms, will help to strengthen the WTO as an institution, and ensure its place as a credible guarantor of our international trading system.

We must now build on the European and G7 consensus and work together through the G20 to implement these reforms swiftly. The G20 Buenos Aires Summit is an important moment to address the deficiencies of the WTO system. It will be a crucial stepping stone towards the work of Japan’s G20 presidency in 2019, where we are optimistic about the adoption of a roadmap on WTO modernisation.

Instability in our global trading system is not good for anybody. It is bad for business, workers, consumers and the entire economy. It hits Europe and other developed economies hard, but it hits other markets even harder. Fragile developing economies feel the shocks even more than we do, because often they do not have the capacity to cope with them. The economic and social impacts from external challenges are a big threat to these countries and their governments, however comprehensive the reforms they are putting in place to stabilise their economies. We owe a duty of care and support to our partners and our neighbours, whether near or far. This is why the European Commission continues to stand for free, fair and reformed trading rules for us all.

I firmly believe that commonly agreed rules do not tie us down. On the contrary, they set us free. They free us from the ‘winner takes it all’ system, and the law of the jungle, where only the biggest and strongest can prosper. There is no such thing as good unilateralism. There is no protection in protectionism.