Progress has been made, but more progress is needed.
Study assessing the impact of the COVID-19 crisis on the European Union's Internal Market and consumer protection prepared for the European Parliament.
In-depth briefing and analysis on the issues of digital trade and the geopolitics of trade provided to the European Parliament.
Testimony to the European Parliament on the geopolitical aspects of trade.
Diversification is important because it is associated with economic growth and reduced volatility.
China’s state capitalist economy poses a challenge to EU openness to foreign investment. In response, the European Commission 17 June published a White Paper on “levelling the playing field with regard to state aid”, contemplating sensible and balanced policies to protect the integrity of the European single market from subsidised foreign acquisitions. However, against the backdrop of collapsing global capital flows and limited existing FDI from China, there is little risk of excessive exposure, indeed a deepening of bilateral investment flows would be beneficial for both economies.
In this report, we have focused on trade and investment relations and have not attempted to define the many other policy instruments that the EU can and should pursue to increase its leverage towards China, and to protect its domestic economy while boosting domestic investment and trade.
As countries are struggling with the COVID-19 pandemic, shortages in medical equipment led to EU export controls and war-time like procurement of respirators. While the crisis is still unfolding, there is a debate on whether the EU is too reliant on global value chains for medical goods. Looking at the world market of medical goods for the EU, we argue that self-sufficiency is the wrong approach. Global medical markets are to the benefits of the EU and stockpiling and preparation are more effective in preparing for emergencies.
In the midst of the COVID-19 epidemic, the sharp collapse in the oil price has received little attention. Brent fell by 30% on 9 March, the largest fall since the 1991 Gulf War. The Russian ruble followed suit and its tumble highlights Russia’s continued dependence on resource extraction. The episode should be taken as a sign of things to come in a world where Russia’s main customers are going green.
Most foreign direct investment into Russia originates in the European Union: European investors own between 55 percent and 75 percent of Russian FDI stock. This points to a Russian dependence on European investment, making the EU paramount for Russian medium-term growth. Even if we consider ‘phantom’ FDI that transits through Europe, the EU remains the primary investor in Russia. Most phantom FDI into Russia is believed to originate from Russia itself and thus is by construction not foreign.