Trade harmony is the music of the free world order

In the whirlwind of summits held by President Joe Biden during his week in Europe — the G7, NATO, the United States and Russia, and a series of bilateral meetings — the one with the fewest comments may be the most important. EU-U.S. Summit Last Tuesday marked a tidal change in transatlantic relations and the waning influence of the West in the world.

The headlines focused on the most concrete achievement-an agreement to end the long-term trade war surrounding aircraft manufacturer subsidies. Welcome. Despite this, it missed the really important thing in the summit, which is actually the aviation transaction itself. A five-year suspension of trade sanctions may or may not resolve the conflict between Boeing and Airbus. More importantly, the conflict has subsided and integrity has been restored. Both parties are committed to policy-making guided by common values ??and interests, rather than dividing their issues.

Its impact goes far beyond the liberalization of conventional trade or the end of the tariff war during Donald Trump’s presidency. Both Europe and the United States are increasingly instrumentalizing trade policies to serve non-commercial value and geostrategic issues. This trend will now be more coordinated.

The summit statement clearly pointed out that trade is becoming a shared geopolitical tool that “helps tackle climate change, protect the environment, promote workers’ rights, and expand flexibility… supply chains.” Even if China is not mentioned, perhaps it is to pay tribute to Europe’s rigorous, “non-market economy that is destroying the world trading system” is undoubtedly referring to who.

The most important result is the establishment of the US-EU Trade and Technology Committee.Count it as a score for the European Union, where It is this Submitted to the incoming US government in December. Brussels may even be a little surprised at how Washington accepts and implements this idea. The committee will involve three of Biden’s cabinet members-the secretary of state, the secretary of commerce, and the trade representative-and various working groups covering everything from technical standards and data governance to investment screening and security and human rights issues.

We can reasonably hope for two positive results. One is a more consistent approach to managing the digital economy. This will make it easier to deepen digital trade and data transmission between the two economies. The United States has quickly adopted a more European approach to restrain private technology companies, which has helped.The latest sign of this transformation looks like Biden’s Appoint Lina Khan, As a competition regulator, criticizes the market power of technology giants.

The second is to strengthen cooperation in standard setting. This includes the Internet-the summit statement sets “the goal of promoting a democratic model of digital governance”-but should be extended to physical technology standards.Actively seek in China Leading the development of global standards, A tighter transatlantic approach is a game changer.

I have accepted the emergence of the “divided network”. The digital barriers between the United States, the European Union, and China are getting bigger and bigger because they set different rules for the digital economy. What I am more optimistic now is that the regulatory split on both sides of the Atlantic can be minimized. This will completely change the balance of influence on governance and standards adopted elsewhere, and put pressure on China to adapt to the Western model rather than the other way around.

Of course, the hard work remains to be done. Both parties are jealous of their regulatory sovereignty and are aware of their competition. In addition, the previous cooperation committee was also disappointing. But today is different: the perception of common vulnerability is stronger, the Trump era is still fresh in people’s memory, and the feeling that global economic rules are being quickly rewritten is overwhelming. Cooperating to formulate new rules is more promising than trying to resolve differences between the United States and Europe over the old rules.

None of this will make the traditional EU-US trade agreement more likely to be reached. But this is not the point. In the 21st century, trade policy increasingly seeks a common approach to domestic regulation-yes, smooth trade flows, but equally important is the development of global rules of the game.

The summit made Biden’s plan shine, showing that democracies in the world can work together to bring citizens better results than the alternatives advocated by the global strongman. With the revival of the relationship between the EU and the United States, the old liberal world order will continue to fight and then fight again.

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