EU Trade Policy
How the EU negotiates trade deals as a single bloc, why this gives it enormous leverage, and the democratic tensions that arise when trade affects regulations and standards.
Trade as an Exclusive EU Competence
Trade policy is one of the few areas where the EU has 'exclusive competence,' meaning the European Commission negotiates trade agreements on behalf of all member states. Individual countries cannot sign their own trade deals. This pooling of negotiating power transforms the EU into the world's largest trading bloc, with a combined GDP rivaling the United States.
The Commission's trade leverage is enormous. When the EU negotiates with countries like Australia, Japan, or Mercosur, it represents a market of 450 million consumers. This scale gives the EU influence disproportionate to what any individual member state would have. The EU-Japan Economic Partnership Agreement, which entered into force in 2019, was the world's largest bilateral trade deal by GDP covered and would have been inconceivable for any single European country to negotiate alone.
