Gordon Brown has today launched a very thinly veiled attack on the European Commission’s trade deal with China on textiles in an article in the FT – summary here. His basic stance is towards those that have appealed for quotas is tough – protectionism is not going to save inefficient European economies. But there are a couple of problems with this. Brown’s arrogant and hectoring style grates with other EU Member States at the best of time, and during the UK Presidency this could be described as highly irresponsible. Secondly, China’s political system really stinks. So should we really be so willing to help sustain its economic boom?
Trade liberalisation is all very well, and indeed the way the EU has behaved on the China textiles issue looks quite ridiculous. Questions have to be raised as to whether the quotas would really aid EU textiles firms anyway – as many UK clothing firms have said, this will just prompt new efforts to source produce from the Indian sub-continent or Africa. Even for high quality goods, considerable outsourcing from Italy to the new Member States has already taken place.
On the other hand, Brown is very much in a position to be able to just shrug his shoulders at home. The UK’s manufacting base – historically weak – has never even assumed it could count on government support in the same way as in many other EU member states. Take the example of the bankruptcy of Rover – the government just shrugged its shoulders and told the locals to deal with it. Few other countries’ governments would have reacted that way.
Yet beneath all of this argument is a deep sense of unease. By giving the OK to freedom of trade with China, the EU is saying once more: we believe the Chinese state is a legitimate trading partner. The need for dmeocracy, respect of human rights etc. all seem to have conveniently been forgotten.
Link trade to reform, and I agree with Brown. But talking just in terms of the economics of trade, and doing this to rile EU counterparts, strikes me as a irresponsible approach.