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France, Germany seek new EU trade tool against market distortions

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France, Germany seek new EU trade tool against market distortions

BRUSSELS, October 6 The story begins with a quiet but urgent push from Paris and Berlin to reshape how the European Union defends its economy against what they see as unfair trade practices by global rivals. What unfolded is a Franco-German document released ten days before EU leaders gather in Brussels to discuss trade imbalances with China, calling for new rapid-response tools to counter market distortions used as economic weapons.

At its heart, the proposal reflects growing concern that systemic and persistent distortions — such as dumping, widespread subsidies, and restrictions on currency convertibility — threaten Europe’s industrial base and could lead to widespread job losses. German officials said the EU needs a mechanism as powerful as the United States’ Section 301 tariffs or China’s limits on critical mineral exports, though the measure would not target any specific country.

France and Germany urged the European Commission to propose two instruments: one to reduce reliance on single sources for critical supplies, and another to restrict access to the EU single market for countries undermining fair conditions through political or economic means. The document said any Commission proposal to activate counter-measures should be adopted unless a qualified majority of EU members opposed — a lower threshold than required for some current trade protections.

German officials added that such measures could be activated swiftly, potentially within days, though final approval would still need agreement from EU governments and the European Parliament. A French presidential adviser said it was urgent for the EU to act, describing current trade imbalances with certain partners as unsustainable and warning against continued naivety in trade policy.

They urged the bloc to deploy existing anti-dumping measures immediately while pushing for the new tools, arguing that delay only deepens vulnerability. Looking ahead, all eyes will be on the upcoming EU summit in Brussels, where leaders will weigh these proposals amid broader discussions on China trade relations and economic security.

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