EU must speak in one voice in trade crisis – by Zigmantas Balcytis

Trade dispute between Russia and Lithuanian must be on the agenda at the highest EU level .All EU Member states must be backed up by the EU when they undergo economic pressure from third countries.

The EU must establish a common economic protection mechanism to protect its Member States from unjustified trade distortions which harm economy of the Member States affected and weakens EU as a while.

Lithuania is successfully implementing its Presidency programme and the European Neighbourhood Policy especially with the eastern countries which is one of the key priorities of the Presidency. Thus, the pressure from Russia can be directly associated with Lithuanian Presidency and its ambitious agenda.

Russia is applying both economic and political measures without any official claims or evidence on the quality of Lithuanian production. However, in this case Lithuania as well as other Baltic Member States do not have any other alternatives.

The Baltic farmers are still unable to compete on equal terms with the farmers from more economically stronger EU Member States which receive significantly higher direct payments from the EU. As a result, Baltic Member Sates are forced to look for potential markets in other countries outside the EU where the agriculture is subsidized less than in the rest of Europe.

If we take a look at the trend of the growth of Lithuanian export we will see a significant increase in the export of food as well as agricultural production to the Russian market.

According to the data provided by he Lithuanian Department if Statistics  during the first quarter of this year  Lithuanian food production  export to Russia reached 19,1 percent or around 155 million euros  which  is the largest export share of food production to a single outside  market in all EU.

A common European economic protection policy should include the compensatory mechanism of all loss and expenses incurred by the affected Member State  that would allow implementing a principle of solidarity. A bilateral dispute settlement committee should be established at the EU level with the mandate to intervene into trade disputes between a Member State and another party .In trade crisis it would be more effective for the EU to speak in one voice and to apply adequate impact measures at the EU level.

If the EU fails to establish such a policy we will continue encountering similar harmful actions of third countries in the future. And that is a real threat not only to Lithuania but to all the Member States of the EU and Russia might not be necessarily the only country exerting pressure.

Leave a Reply

Your email address will not be published.