How Romania comes out of the US-EU commercial agreement and who is laughing. “If we shoot ourselves in the foot, we cannot blame Trump.”
Economics professor Bogdan Glăvan and international political analyst Stefan Popescu offers new perspectives to the Commercial Agreement between the EU and the US. Romania is also present in the equation.
Donald Trump and Ursula von der Leyen have reached a photo consensus: Profimedia
The European Union and the US signed a commercial agreement that prevents the commercial war between the two parties, which appeared at one time inevitable. Both parties have made certain concessions from maximum claims, but as happens every time, there is a winner or, more correctly, a beneficiary.
The political scientist Ștefan Popescu believes that the European Union has folded in front of US demands, accepting to pay an access fee on the US market of 15%. In addition, the EU will make investments in the US of $ 600 billion and will buy $ 750 billion.
Who is laughing after
“The consequences of this agreement will be huge. First of all, it will block the policy of approaching the UK by the European Union – not by chance the agreement with London is much more generous and also includes concessions on British aluminum, steel exports.”Says Popescu.
On the other hand, as decades in a row the European Union has been dependent on Russian gas, it will now become dependent on the US imported gas. But the prohibitive prices will make the European Union economy remain non -competitive.
“The massive GNL acquisitions will maintain a competitive disadvantage for the EU industry and I really wonder how profitable it will be to expand production lines- some big energy consumers- to increase the ability to make military equipment.”says Stefan Popescu.
Romania will be affected by ricoșeu. Given that the European car industry will be hit in full, the subcontracting industry in Romania, which produces spare parts for Western cars, especially German, will have a huge suffering. Predictably, orders will continue to decrease, and many of the Romanian companies will risk going bankrupt.
“The acquisitions of European products in the US, such as German cars, will decrease because the products will be more expensive and this will automatically lead to the restriction of production in the German car industry. Consequences will be for the subcontracting industries in Eastern European countries, such as Romania”, Explains Stefan Popescu.
The faults are multiplying in the European Union
In his opinion, all these issues risk to severely affect the European Union and Unit in the future.
“All of this will have political effects for the European Union – cracks risk being increasing in the walls of the European House”, Considers Stefan Popescu.
Something more optimistic is the university professor Bogdan Glăvan. Expert in macro and microeconomics, development economy and monetary economy and director of the Center for Romanian-American Economy and Business “Murray Rothbard”, Glăvan does not see a defeat of the European Union, although it admits that the agreement can be read in several keys.
“The EU-Sua trade agreement can be read in several keys. On the one hand, I would not call it a defeat of Europe, as some do (even economists) close to the Democratic Party and who, through this reaction, only give water to Trump's supporters, who, The elections.“Says Glăvan.
The impact of American customs duties will be borne by the American citizen, Bogdan Glăvan believes.
“If he would like it, well, if not, then we will see other treaties. Of course, it was best if I went before with the liberalization of trade, with free trade without barriers. But politicians will not. When the people will vote at liberalism.”points out.
Taxes for everyone
He also recalls that the United States of America has imposed taxes to all countries, not just the European Union. The good news would be, says Bogdan Glăvan, given that the taxes imposed on Europeans are lower than for countries like Mexico and Canada, European cars have more competitive prices in the US.
“In addition, the US imposes customs duties for imports from all countries, not just from Europe, so what matters is whether customs duties in our case are lower than in other cases. And the answer is that customs taxes remain at the lowest level in the world; only imports from the UK are charged with 10%, all other imports from 15%. The detriment of Europe. He discovers that it is cheaper to buy a European car, with the new customs duties with everything ”, he adds.
The real issue of the European Union
In addition, the fact that the agreement stipulates that Europeans will purchase weapons and energy from the USA does not change things, because this happens anyway with or without agreement.
“On the other hand, the agreement establishes that the EU will buy gases and weapons from Americans. What we do today, it is very good to continue cooperation in these strategic fields.”points out.
The big problem is, the expert admits, that the European Union does not produce energy, which is why it is very expensive. But the European politicians are to blame, which exaggerates with environmental policies and sacrifices the competitiveness of the economy.
“Of course, it was best if we were producing more energy. But politicians will not, they want to reduce CO2. If we Europeans shoot in the foot, we cannot blame Trump, in fact, Trump and tells us not to shoot in the foot and here he is right,”
he says.
Viktor Orban, abandoned by Trump
Bogdan Glăvan also notes that the prime minister of Hungary, Viktor Orban, seen for a long time as a close relative of Trump, is ignored by the head of the American state and is the great defeated in this complex equation.
“From this political perspective is interesting to upset some, for example Viktor Orban. Remember me, please, wasn't Orban Trump's great friend? Now criticizes the EU because he did not enter the commercial war with Trump? Ridiculous. This proves the hidden agenda of these so-called Sovereign. We also advance with the single European market. Success! ”, Bogdan Glăvan concludes.
