EUCDW Resolution Europe must Protect its Strategic Interests

Europe must protect its strategic interests

I. Globalization affects all areas of our everyday life. Many Europeans experience the
benefits of being connected with people in other countries and continents. A third of
our national income is based on world trade. However, many citizens also many
consider globalisation as a cause of layoffs, social inequality and low environmental,
health and privacy standards.

International agreements, which set out the rules in these areas, are not always
respected. We cannot accept to have competitive disadvantages for European
companies to put jobs at risk as a result.

II. Europe stands for open and fair trade. However, we are not naïve ‘free traders’, as
Jean-Claude Juncker stated in the State of the European Union speech on 13
September 2017. Therefore, we must ensure that our companies can operate under
the same conditions as our trading. At the same time, we must defend the multilateral
trade system. We need to ensure that we have the instruments to tackle unfair
competition and dumping of products on the EU market in order to protect jobs. Wage,
social and environmental dumping by trading partners is unacceptable as a competitive

The EUCDW stands firmly behind the new anti-dumping policy of the EU, through
which market distortions can be addressed directly. The EU must have the instruments
to ensure a level playing field and to take action against countries or companies that
use unfair practices. More EU staff are required for the adequate application of these

III. As an important source of economic growth, employment and innovation, foreign
direct investment have always been an essential factor in the economic and social
development of the European Union. They have generated significant benefits for the
Union and its citizens by supporting, for example, the objective of the European
Commission to stimulate investment. For this reason, the EU maintains an open
investment environment and welcomes foreign investment.

The EU is one of the most open economies for foreign direct investment; the flow of
such investment to the EU is steadily increasing. More and more, these investments
are targeted towards strategically selected sectors and innovative, large companies.
Increasingly, these investments come from state-owned enterprises or investors with
close ties to governments.
Globally, however, restrictions on foreign direct investment have increased since 2016.
European investors frequently do not enjoy the same rights as foreign investors in the EU.

Moreover, the strategic focus of investments is on taking over European companies
which develop key technologies or support critical infrastructure for society and the
economy. The combination of these developments has caused legitimate concerns
among European citizens, companies and Member States. These concerns require
appropriate measures, as announced in the Reflection Paper on Globalisation of the
European Commission on the 10 May 2017 and in the State of the European Union
speech on 13 September 2017.

The openness of the Union towards foreign direct investment must be accompanied
by robust and effective political measures to ensure a level playing field. We want to
protect the economy of the Union against investments that pose a threat to the
economic base and to jobs in the EU.

IV. The ‘Investment Screening’ proposal of the European Commission is a step in the
right direction, but does not meet all requirements.

The proposal leaves control of foreign direct investment largely to the Member States
and limits controls to the areas of public safety and public order. Where projects or
programmes cover the interests of the Union, investments can be screened by the
European Commission.

If the control of foreign direct investment lies largely with the Member States, it remains
possible that a foreign investor chooses the country with the weakest investment
screening mechanism and subsequently has access to countries with stronger
investment screening mechanisms through the Internal Market.

The EUCDW proposes to extend investment control to strategic sectors, in particular
innovative technologies. Given the European Internal Market, it only makes sense to
organise the investment screening on a European level.

The EUCDW considers that the EU must exercise its competence over foreign direct
investment. Both the investment screening and the decision whether these
investments can be allowed, must lie in the hands of the Commission. The Member
States must be involved in the decision-making process on foreign direct investment.

Positions in 2017

EUCDW Resolution 'Europe must Protect its Strategic Interests'

EUCDW Resolution 'Europe must Protect its Strategic Interests'