EU shifts trade focus to BRIC nations

The European Union has signalled a shift towards a trade policy that is more assertive and focused on its relations with the major powers including the "BRICs" - Brazil, Russia, India and China.

The EU is New Zealand's second largest export market and third largest source of imports. Globally it accounts for the largest share of world trade and its share has held steady at around 17 per cent over the past 10 years.

That excludes trade among EU member states. Its two-way external trade last year was €3.2 trillion ($5.6 trillion) and fairly evenly balanced between exports and imports.

European Trade Commissioner Karel de Gucht last night released an outline of the EU's trade agenda.

While it regards cutting tariffs on industrial and agricultural goods as "still important", the EU sees the larger challenge for trade liberalisation as lying elsewhere: in improving market access for investment and services, opening up government procurement, better protection of intellectual property rights and unrestricted supply of raw materials and energy.

It lists completion of the WTO's Doha Round as the top priority. But the Doha talks have dragged on for nine years, progress is glacial and it rates only three paragraphs in a 15-page document.

Bilateral relations with the US, China, Russia, Japan, India and Brazil must now be "even more of a major priority", it says.

The EU is negotiating a free trade agreement with India (a process on which New Zealand has also embarked).

Brazil is central to the South American bloc Mercosur, with which the EU has recently relaunched negotiations.

China is its second largest trading partner, but it cites a lengthy list of trade concerns including inadequate enforcement of intellectual property rights, industrial policy measures aimed at import substitution, forced transfers of technologies and measures to grant Chinese producers preferential access to raw materials.

It says similar issues arise with Russia.