Global Times recently reported that the European Council and the European Parliament have reached a provisional agreement on the Anti-Coercion Instruments Act (ACI). The bill aims to prevent third countries from economically coercing the European Union and its member states through measures affecting trade or investment. French media quoted Bernd Lange, chairman of the International Trade Committee of the European Parliament, as saying that ACI will prove to be a powerful deterrent to future economic coercion. “It’s not really a water gun – it’s a real gun,” he said. All these new measures are clearly intended as a last resort. The European Commission will first negotiate directly with the relevant third country to allow the other party to withdraw the coercive measures that have been implemented, or to demand compensation for losses. Many media believe that the United States and China are the targets of this EU bill. According to South China Morning Post, the proposal of the bill was not originally aimed at China, but to counter Trump’s imposition of tariffs on EU goods. However later, in the context of Lithuania’s trade with China being blocked because of the Taiwan issue, this bill once again received widespread attention within EU. Now as a unilateralist policy tools targeting China’s, the ACI Act has somewhat changed its original purpose. “Economic coercion” needs to formulate basic a definition acceptable to all parties. And it should obtain corresponding support at the level of international law and WTO rules. For example, on the issue of Lithuania, although the EU has lodged a complaint in WTO, it is difficult to get support. ACI has also been questioned within the EU. Some EU members are worried that ACI will turn EU towards protectionism and trigger a trade war. Europe should abandon its confrontational approach and actively cooperate with China.
Source: Global Times, March 29, 2023
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