EFTA parliamentarians and social partners strive for open markets as an engine for competitiveness

On Tuesday 27 June 2023, on the margins of the EFTA Ministerial meeting, the EFTA Parliamentary Committee (EFTA PC) and the EFTA Consultative Committee (EFTA CC) met with EFTA Member States’ Ministers in Schaan, Liechtenstein.

The meeting provided the opportunity to assess how EFTA should position itself for global green subsidies and how to maintain and uphold competitiveness for the EFTA countries. Stakeholders also reviewed ongoing third-country processes and exchanged views on continuing the diversification of their trade partners.

The meeting was co-chaired by Trine Lise Sundnes (the Norwegian Parliament), Chair of the EFTA PC and by Kristin Hansen (Confederation of Norwegian Enterprise), Chair of the EFTA CC.

Referring to new subsidy schemes such as the US Inflation Reduction Act, Kristin Hansen said “We need to consider in this setting what effect the trend of increased green subsidies at a global level may have on EFTA businesses, jobs, and competitiveness and how we grasp this different reality”.

“The climate change fight has become an overwhelming issue. Trade policy needs to contribute to sustainability goals. EFTA pursues its open trade agenda in a pragmatic manner with a strong environmental component” stressed Dominique Hasler, the Minister of Foreign Affairs, Education, and Sport of Liechtenstein, and Chair of the EFTA Council.

Trade with Ukraine and India on the agenda

The economic resilience of Ukraine amid the continued war of aggression was again one of the top considerations of the meeting. As early proponents of comprehensive support to Ukraine, including on trade, EFTA parliamentarians and social partners welcomed the formal launch of the modernisation process of the EFTA–Ukraine free trade agreement and called for its speedy conclusion.

Against the backdrop of a series of high-level meetings with India, including a delegation visit of the EFTA PC to Delhi and Mumbai, both committees welcomed the new impetus that has been injected into this long-standing process and expressed the wish for a conclusion of the negotiations with this strategic partner.

EFTA parliamentarians and social partners used the opportunity to discuss openly the state of play regarding the negotiations with Mercosur countries that had been concluded in substance in 2019. “Following a series of successive crises and EFTA’s ambition to diversify its supply chains and make them more resilient, we have to make up our minds on how to go forward with this strategic partner”, said Ms Sundnes.

Given the deep intertwining of EFTA countries’ economies with the Single Market, ongoing processes where the EU has concluded negotiations or are close to finalise them ahead of EFTA were thoroughly reviewed: Vietnam, Chile, Mexico, New Zealand, and Australia.

Both committees asked for information about additional processes which could further untap potential for EFTA’s economies and their long-term competitiveness. They mentioned the upgrade of the free trade agreement with Singapore, the conclusion of the negotiations with Malaysia, and the finalisation of a Joint Declaration of Cooperation with the Association of Southeast Asian Nations (ASEAN).

High-level engagements with third-country Ministers

Earlier in the day, the parliamentarians and social partners met with third-country Ministers who travelled to Liechtenstein to do business with the EFTA Ministers. They met with Dorin Recean, Prime Minister and Dumitru Alaiba, Minister of Economic Development and Digitalisation of Republic of Moldova and praised the conclusion of the EFTA–Moldova free trade agreement. The upgrade of the EFTA–Singapore free trade agreement by concluding a Digital Economy Agreement was also assessed with Mr Iswaran, the Minister-in-charge of trade relations of Singapore.

At their internal meeting, the EFTA Parliamentary Committee exchanged views with Norbert Lins, the Chair of the Committee on Agriculture and Rural Development of the European Parliament to evaluate the European Union’s approach on economic and trade support to Ukraine. EFTA parliamentarians also discussed the latest political developments in EFTA countries since their last meeting, endorsed their work programme until the end of the year, and decided upon their 2024 delegation visit.

The EFTA social partners held internal discussions on the future direction of EFTA trade cooperation. They identified three overarching key developments to be taken heed of when moving forward. Firstly, the relationship between trade and climate change; secondly, the increased regionalisation of trade; and finally the increased interrelation between security and trade policy in global trade should be considered.

The EFTA PC and the EFTA CC are EFTA advisory bodies. The EFTA PC is a forum of parliamentarians from the four EFTA countries, while the EFTA CC brings together representatives of the trade union confederations and employers’ associations in the four EFTA countries. The mission of both committees is to scrutinise and provide advice on the EFTA States trade relations with third countries as well as on relations with the EU through the implementation of the European Economic Area (EEA) Agreement. They are vital platforms for dialogue and consultation on social, economic, and political aspects of the EFTA free trade agreements, and the functioning of the EEA.