For the German chemical and pharmaceutical industry, the USA and China are by far the most important trading partners outside Europe, while Great Britain is one of the biggest partners outside the EU. These are just two of many reasons why the chemical industry is hoping for initiative, determination and success from the EU in its efforts to promote free trade. The following are also important factors:

• Chemical companies have global and highly complex supply chains. Hard-fought trade disputes can have a severe impact on supplies and sales.
• The availability of system-relevant goods must be ensured, as the coronavirus crisis has demonstrated. This is why we wholeheartedly support the EU’s proposal to the Ottawa Group of WTO members to facilitate trade in healthcare products. These include the elimination of tariffs on pharmaceutical and medical products as well as a regime for global cooperation in health crises that covers aspects such as import and export restrictions, tariffs and transit.
• This drive by the EU also includes improving WTO rules for trade in essential goods.

Green light for diplomacy

The coronavirus pandemic, however, has merely further highlighted the inaction surrounding the EU’s trade policy. By signing up to the world's largest free trade agreement, the Regional Comprehensive Economic Partnership, China has moved swiftly to achieve its trade strategy goals; any EU companies active within this vast economic area will also benefit from low tariffs and common standards. At the same time, the EU and China should achieve results with their investment protection agreement, which has been under negotiation for years, and jointly strengthen the WTO.

In the event of trade disputes, this provides defined procedures for reaching lasting solutions, which, in our view, always take precedence over harsh steps like punitive tariffs that disrupt supply chains. And with the incoming US government, all the instruments of diplomacy will once again be available to us. The EU should definitely not pass up this opportunity. Negotiations surrounding the Transatlantic Trade and Investment Partnership (TTIP), which have been dormant for years, still involve a great deal of detailed work. After all, the free movement of goods is by no means just about reducing customs duties, but also about the mutual recognition of standards and procedures. This means an enormous reduction in costs for companies active in foreign trade.

Acting swiftly and with precision

Numerous trade wars, not to mention Brexit, have highlighted the harmful impact of national unilateralism on the international exchange of goods, making focused, close negotiations conducted with a sense of mutual respect all the more urgent – right now!

Anno Borkowsky is a member of the Board of Management of LANXESS AG. He was also recently appointed to the Board of Management of the European Chemical Industry Council (Cefic).