European Commission President-elect Ursula von der Leyen Tuesday called for sharper trade weapons to take on U.S. President Donald Trump.
Von der Leyen tasked her pick for trade commissioner, Phil Hogan, with developing new retaliation powers to hit back specifically against countries that are blocking the dispute settlement system of the World Trade Organization — namely, the United States.
“I want you to look at how we can strengthen our trade toolbox,” von der Leyen told Hogan in her mission letter. “This should include upgrading the EU’s Enforcement Regulation to allow us to use sanctions when others adopt illegal measures and simultaneously block the WTO dispute settlement process.”
Von der Leyen also hinted at a more muscular approach toward Chinese subsidies, telling Hogan to “work with the Executive Vice-President for … Digital Age [Margrethe Vestager] to address the distortive effects of foreign subsidies in the internal market.”
The EU has been looking at ways to tackle China’s massive subsidies, but trade chief Sabine Weyand last week ruled out applying EU state aid law “extraterritorially.”
The president-elect also confirmed there would be a new “chief trade enforcer” post, appointed by the College of Commissioners, who will work under Hogan’s “direct guidance to monitor and improve the compliance of our trade agreements.”
Lastly, von der Leyen said Hogan should “contribute to the design and introduction of the carbon border tax, working closely with the commissioner for the economy. The carbon border tax should be fully compliant with WTO rules.”