Using trade policy for strategic ends will be harder than Macron thinks

To arms, citizens. Two years ago, the EU – under the leadership of the self-proclaimed “Geopolitical Commission” of Ursula von der Leyen – adopted the ambitious but vague goal of developing European “strategic autonomy” at the global level.

Although invoked almost daily in Brussels, the concept has remained ambitious, even abstract. Meanwhile, the EU faces real and specific threats, with China blocking Lithuania’s exports and Russia threatening to invade Ukraine. Now would be the right time to use the EU’s indisputable influence in trade policy for strategic ends to resist pressure from hostile governments.

Enter, to the sound of bugles and the roar of horses’ hooves, a cavalry charge led by Emmanuel Macron. The French president will lead the council of EU member states for the next six months – assuming he is re-elected in April – and will aim to overcome EU disunity and France’s own vulnerabilities to build power European geopolitics.

In theory, this is exactly what the EU needs: the leadership of a large Member State with its own renowned military, intelligence and diplomatic capabilities. For the presidency of the council, Macron adopted a rallying cry – “revival, power, belonging(“Recovery, power, belonging”) – with more than a burst of revolutionary zeal. He also has a personal motive to build a European strategic power independent of his traditional allies, after the humiliation of last September at having been ambushed by the Australia-UK-US security pact (Aukus) and its deal on nuclear submarines.

With excellent timing, the EU is creating a new commercial weapon, an “anti-coercion” legal instrument, which France wants to speed up. The tool will allow rapid retaliation with trade, investment and financial measures against illegitimate pressure from foreign governments. In the future, this will hopefully deter countries like China from intimidating EU states like Lithuania.

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But multiple vulnerabilities hamper France’s ability to lead the reorientation of EU trade policy for strategic ends.

The first is the foreign policy disunity within the EU towards China, Russia and the United States. Macron frequently disagrees with some member states in the eastern half of Europe, particularly over his previous emollience to President Vladimir Putin. Considering Russia’s belligerence towards Ukraine and Russian-linked mercenaries sent over French objections to Mali, where France is ending a peacekeeping force, this appears to have been a bad bet.

Likewise, despite being critical of Chinese trade policy, Macron in 2020 recklessly succumbed to German persuasion to back the EU’s bilateral investment deal with China. The deal, thankfully suspended, has caused consternation across the EU and within Joe Biden’s new administration in the US for making Europe appear weak.

Indeed, Macron’s skeptical attitude towards the United States suggests that he is too animated by French interests, especially the Aukus episode. Given the hesitations of Biden’s foreign policy and the possibility of another presidency of Donald Trump, he is right about the risks of reflective Atlanticism. But other European countries such as the Baltic States are not convinced that the EU, with its limited trade and financial sanctions instruments, can take over. The United States is Russia’s main interlocutor in this week’s discussions in Geneva on European security: European institutions are not invited. Support from other member states for France’s fury against the Aukus deal has been slow and moderate.

Second, France is often too politically vulnerable at the national level to use trade as an effective strategic weapon. A slightly childish but symbolically unequivocal way to punish Australia for Aukus would have been to strike the EU’s nearly completed bilateral trade deal with New Zealand, a country that bans nuclear submarines from its ports, while by blocking a parallel Australian deal. But both countries are beef exporters, the French presidential election is approaching, and the country’s cattle ranchers are notoriously loud. Paris chose to delay both deals until it was someone else’s problem.

Notably, the slogan “strategic autonomy” began as “open strategic autonomy,” but France argued vehemently last year to drop even an abstract reference to free trade. Other member states fear that the anti-coercion tool that France strongly supports will be used for protectionist rather than strategic purposes.

Finally, to achieve its ambitions for the EU, France needs Germany on board. Macron may have been gentle with Russia and China, but Germany has so far proven to be soft to the point of liquefying. German industry has criticized Lithuania’s mistrust of Beijing and lobbied against decoupling from China. Earlier this week, Philippe Léglise-Costa, French ambassador to the EU, was noticeably lukewarm about a confrontation over Lithuania. He said at a seminar in Brussels that, while member states should show solidarity with Vilnius, the EU should pursue any violation of trade law through the usual channels of the World Trade Organization and seek a solution. negotiated.

French cavalry charges have always been magnificent to watch, but in a European context they are more often announced than executed. The arguments in favor of centralizing some strategic power in the EU are strong. But Macron’s ability to deliver will require more European unity and French domestic resilience than is currently displayed.

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