Tony Barber

The election of Dervis Eroglu as Turkish Cypriot president appears at first sight to deal a severe blow to the latest United Nations-sponsored efforts at solving the Cyprus problem.  But appearances can be deceptive.  There may, in fact, be an opportunity for a breakthrough.  Crucially, however, it will require the involvement of the European Union.

Eroglu, 72, is usually dubbed a “hardline nationalist” in the international media on account of his long-standing commitment to Turkish Cypriot independence.  This is to miss the point that the Turkish Cypriots are economically dependent on Turkey and Eroglu can hardly act in defiance of the government in Ankara.  It is in the Turks’ wider diplomatic interests to bring about a Cyprus settlement.  They have already made it plain to Eroglu that they expect him to behave constructively. Read more

Tony Barber

Ask a minister in a European Union government what post their country hopes to get in the next European Commission, and the response is the same every time – something important to do with the economy.  Well, you can’t blame people for not hurrying to step into the shoes of Leonard Orban, the Romanian commissioner for multilingualism.

On the other hand, there aren’t enough top economic jobs for Commission president José Manuel Barroso to satisfy everyone.  Truth to tell, the Commission looks too big with 27 members.  But that’s the way it is, and that’s the way it will stay under the EU’s Lisbon treaty.  A guaranteed seat on the Commission seems a simple, visible way of making a country’s citizens feel connected to the EU. Read more

Tony Barber

Since February 1999, when the Organisation for Economic Co-operation and Development’s anti-bribery convention came into force - with the aim of reducing bribery of foreign officials in international business deals - the US has brought 103 cases, Germany more than 40, France 19 and the UK just one.  So says “Global Corruption Report 2009: Corruption and the Private Sector”, a study published on Wednesday by Transparency International, the anti-corruption watchdog.

From a British point of view, the report makes uncomfortable reading.  “UK companies still have a long way to go to increase their awareness and adopt robust anti-bribery compliance programmes,” it says. Read more

Tony Barber

According to an opinion poll, more than half of Denmark’s population has little or no confidence that world leaders will strike an agreement on fighting climate change at December’s landmark United Nations summit in Copenhagen.  It is just a hunch, but I reckon one impulse behind this pessimism is the widespread European suspicion that China, which recently overtook the US as the world’s biggest greenhouse gas emitter, will play an unconstructive role at the talks.

What if this suspicion is unfounded? Read more

Tony Barber

Two weeks ago, Russia announced that it intended to join the World Trade Organisation not on its own but as part of a customs union with Belarus and Kazakhstan.  It was a classic Russian initiative, combining brutal power politics with a healthy dose of surrealism.

For at the time of the announcement, Moscow was in the middle of a trade war with its two neighbours, banning imports of Belarusan dairy products and Kazakh meat.  Russia was also in the process of freezing a $500m credit for Belarus, which in turn was imposing new customs controls on Russian goods.  Acrimonious disputes of this nature do not usually precede the establishment of friendly arrangements such as customs unions. Read more

Tony Barber

The heady aroma of power without responsibility is wafting through the corridors of the European Parliament this week as legislators prepare to slap a blanket ban on the trading of seal products throughout the 27-nation bloc.

It seems little short of ridiculous that the assembly is poised to take this step just as the EU is about to hold a summit with Canada to mark the launch of negotiations on a comprehensive free trade agreement.  If the European Parliament goes ahead with the ban, the Canadians have made it clear that they will start an action at the World Trade Organisation.  Not exactly the best climate in which to pursue a liberalising trade deal, one might think. Read more

Tony Barber

The first time I interviewed Giulio Tremonti, he was in shirtsleeves and a pair of bright braces, puffing confidently on a cigar in Milan. At that time he was finance minister in Silvio Berlusconi’s centre-right Italian government, and there’s no denying it, he looked every inch the part.

Now, as Italians prepare to vote in their April 13-14 election, Tremonti is playing a more populist tune. He’s just published a book, Fear and Hope, which lashes out at globalisation and condemns “the dictatorship of the market”. He also calls for a “new Bretton Woods”. Today’s Tremonti, some may think, has more in common with his protectionist political opponents on the Italian far left than with the Tremonti of 2003. Read more

It is the $22m (€15m) question. How does Europe deal with Chinese imports? That is the hourly rate of the trade deficit with the rising superpower and it is causing angst on the continent.

Even a liberal such as Peter Mandelson, the EU trade commissioner, says the figure is on Europe’s mind. Having praised China’s rise as an unalloyed good for Europe and the world, he has recently taken to wielding the stick with Beijing, warning of a backlash if it does not itself open up to foreign companies.

Mandelson wants a two-way street. China’s vast cheap labour force is bound to mean its exports increase, he says. But there should be a flow of imports of the kind of upmarket goods in which Europe specialises the other way. Service providers should have more opportunity in China’s domestic market. In the meantime, the backlash has started.

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Trade deals garner headlines and photo opportunities. The talks leading up to them tend to be rather more mind-numbing, as countries haggle over whether pig bladders should be considered a sensitive product and just how many widgets should be allowed in tariff-free.

Trade talks between rich and poor countries have the added spice of David vs Goliath about them. With Doha apparently comatose once again, attention in Brussels has turned to negotiations with 78 ex-colonies.

The African, Caribbean and Pacific group (ACP) enjoy a quasi-marital relationship with the EU. It is enshrined in a legal document, the Cotonou agreement, and includes privileged access to EU markets. That arouses the jealousy of other poor countries that threw off their colonial yoke earlier, such as Latin America.

They have challenged the cosy arrangements at the World Trade Organisation and won enough battles to force a rewriting of the marriage vows by the end of this year. These will not be trade deals but "economic partnership agreements", a concept dreamed up in the Brussels bureaucracy. It wants to create clones of iteslf, with regional common markets that trade with each other and achieve economies of scale.

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The European Union is often compared to a bicycle: if it stops moving forwards it will fall over. The bicycle theory also applies to multilateral trade talks.

Hence negotiators keep having meeting after meeting to revive the Doha round, even if they appear only to be inching further down a cul de sac.

Trade ministers chatted in Paris early last week. Then on Thursday and Friday Peter Mandelson, the EU trade commissioner, hosted his counterparts from the US, India and Brazil in Brussels. The talks were, inevitably, “productive”, but just as inevitably did not lead to a breakthrough. You can probably write the closing statement for the next round in June yourself.

In the meantime, the EU ministers are preparing to jump out of the saddle.

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Amid all the distraction of the Paul Wolfowitz affair it’s easy to forgot that life goes on – in abject poverty – for the billions earning less than a dollar a day.

Europe has been vocal in its call for the Wolf to leave his lair. It is once again burnishing its pro-development credentials. But are they all that they are cracked up to be?

Heidemarie Wieczorek-Zeul, the German development minister, said this week that the EU was ahead of its target to dedicate 0.39 per cent of gross domestic product to aid in 2006, hitting 0.42%. The bloc already provides half of the world’s development aid. While she is not known as "Red Heide" just because of the colour of her hair, campaigners beg to differ.

Concord, the alliance of European NGOs released a damning report last week. It said around a third of aid was debt relief, housing refugees in the EU and even paying for foreigners to be educated at European universities. Belgium even tries to pretend its peacekeeping mission in Congo is aid. No doubt any Congolese chicory growers are benefiting from the troops’ presence.

In short, G8 pledges to double aid to Africa were not being met.

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When it comes to dealing with the rise of China it seems Europeans are from Venus and Americans from Mars. The popular phrase of Robert Kagan, the US commentator, appears more apt than ever when talking of the rise of the potential Asian superpower.

The US has acted decisively twice in recent weeks to try to force open the doors to the workshop of the world – to a predictable howl of outrage from Beijing. For the time being, the European Union is prepared to watch from the sidelines – and perhaps even benefit as US-China relations degenerate.

Five years after it entered the World Trade Organisation, the US feels China has not lived up to its obligations. Piracy is still rampant and too many ailing state enterprises are being propped up with subsidies, Washington says.

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Trade, apart from peace and prosperity, is always held up as the great EU success story. If only the EU could get its act together in other areas, such as foreign affairs, it would be a global power, the argument runs.
Lorenzo Bini Smaghi, an Italian member of the European Central Bank board, is suggesting that the unity on trade should be a model for countries in the eurozone to boost the currency’s political weight.
Yet in the last few weeks European solidarity on trade has been conspicuous by its absence.
Last year’s imposition of quotas on Chinese textiles angered nations of shoppers such as the UK and Sweden. They were riled again this summer when the European Commission ruled that Chinese and Vietnamese shoes were being dumped on European markets. Many are made by European companies that have outsourced production.

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