布鲁盖尔研究所-战略外交经济政策的工具（英）-2021.11-131页_5mb

Summary of the Study: Instruments of a Strategic Foreign Economic Policy

This study, conducted by the Kiel Institute for the World Economy (IfW Kiel), DIW Berlin, and Bruegel, is commissioned by the German Federal Foreign Office to explore the instruments and strategies for a strategic foreign economic policy. It provides an in-depth analysis of the interplay between economic and political objectives in international relations, focusing on key areas such as trade, climate, technology, and monetary policy.

Core Content

The report emphasizes the importance of a strategic and integrated approach to foreign economic policy, highlighting the challenges posed by increasing great power rivalry, particularly between the US and China, and the shift from a rules-based to a power-based international order. It argues that economic interdependence is being "weaponized" and that Germany and the EU must actively shape international economic and political relations rather than pursue a strategy of decoupling.

Main Views and Key Information

1. Trade Policy

• Trade policy instruments are used to promote domestic economic welfare and influence foreign governments.
• These include tariffs, export subsidies, quantitative restrictions, trade defense measures, and rules on domestic value added content.
• The EU should continue negotiating and implementing ambitious trade agreements to expand its influence and discipline trade practices.
• The "Brussels Effect" plays a crucial role in setting international standards and influencing trade regulations globally.
• Sanctions are increasingly used to enforce international rules and deter violations, with the EU needing to enhance the credibility of its sanctioning mechanisms.

2. Industrial Economic Perspectives

• The Green Deal and Geopolitics: The EU's Green Deal will impact global trade by reducing fossil fuel imports and increasing demand for green technologies. It also raises concerns about carbon leakage and the need for a Carbon Border Adjustment Mechanism (CBAM) to prevent this.
• Green Hydrogen and Infrastructure: The EU should create lead markets for green hydrogen and ensure political clearance for major energy import infrastructure.
• Supporting Green Investments: Enabling green investments in partner countries is essential for promoting sustainable development and climate goals.
• Digital Technologies and Geopolitical Tensions: High technologies are both a trigger and a victim of geopolitical tensions. The EU needs to strengthen its position in the digital ICT industry and promote digital trade and services.
• EU-US Cooperation: Closer cooperation between the EU and the US is necessary to influence global standards and counter China's economic influence.

3. International Macro-Economic Perspectives

• Euro's International Role: Strengthening the euro's international role is crucial for Germany and the EU. This includes developing a digital euro, deepening capital markets, and improving the resilience of financial institutions.
• Current Account Imbalances: Germany's large current account surplus is a concern for both European and global stability. The EU should address inefficiencies and promote more balanced trade.
• Digital Currencies: Digital currencies are becoming an important part of capital markets. The EU should take a proactive stance in developing the digital euro to protect its interests and influence.
• China's Role in Credit Markets: China's overseas lending has increased significantly, raising concerns about debt sustainability and the need for transparency and reform in international credit relations.

4. Policy Conclusions

• Multilateralism: The EU and Germany should continue to promote multilateralism as a central pillar of their foreign economic policy.
• Defensive Instruments: Defensive instruments such as investment screening mechanisms and rules to block foreign investments should be developed and strengthened to protect the EU's single market and retaliate against rule violations.
• Avoiding Protectionism: Protectionist policies are not recommended as they can undermine the interests of the middle class and the global economy.
• Strategic Partnerships: Building and maintaining strategic partnerships with key countries, especially China, is essential for achieving global climate goals and reducing economic vulnerabilities.
• Integration and Coordination: Europe needs to integrate national policies into a coherent framework, particularly in banking, capital markets, and the single market, to protect its economic interests in a polarized world.

Strategic Recommendations

• The EU should prioritize the completion of the banking union, capital market union, and the single market for services.
• A digital euro should be developed to enhance the EU's economic influence and stability.
• The EU should strengthen its macroeconomic imbalances procedure (MIP) to encourage member states to remove trade barriers.
• A transatlantic agreement with a border adjustment mechanism or an open climate club is recommended to incentivize China's decarbonization.
• The EU should continue to deepen cooperation with the US on trade, technology, and climate issues.
• Investment control mechanisms are necessary to prevent the acquisition of key technologies by foreign entities.
• The EU should focus on improving its internal market and regulations to enhance the "Brussels Effect" and global influence.

Conclusion

The study concludes that Germany and the EU must actively engage in shaping international economic relations and avoid the pitfalls of protectionism. A strong, rules-based international order is essential for global stability and prosperity, and the EU must continue to lead in this area through multilateral cooperation, strategic partnerships, and the strengthening of its economic and political instruments.