The EU Preferential Trade Agreements: Defining Priorities for a Debt-Ridden, Growth-Starving EU

The EU severe debt problem requires urgently the design and implementation of domestic pro-growth reform agendas in Europe. Opening markets to foreign competitors has always been a way to boost and buttress such agendas. A “Sleeping Doha ” Round leaves preferential trade agreements (PTAs) as the only channel for opening markets to foreign competition. In this context, this paper examines two questions: do the PTAs currently negotiated by the EU fit well the EU quest for growth? If not, what would be the appropriate PTAs? Looking at the potential sources of growth in the world during the next decades provides a first lesson. The EU needs a profound change of mind and approach in its international relations because its economic weight will decline dramatically and rapidly. Its current share in the world GDP (25 percent) will be cut by half by 2030 and by three by 2050. The cliché “the EU is the biggest global player in international trade and investment ” has lost any credibility. PTAs can satisfy the EU urgent quest for growth only if the EU partner fulfills three conditions: it has to be big enough to have an impact on the EU economy; it has to be big enough in the immediate future, not in two or three decades from now, because the EU quest for growth is urgent