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EU trade chief attacks protectionism ahead of G20

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EU trade chief attacks protectionism ahead of G20

Karel De Gucht - Photo EC

(BRUSSELS) - Europe's trade chief launched a broadside against protectionism Tuesday, calling for a global trade deal next year and measures to retaliate against closed markets in emerging powers such as China.

"Europe rejects protectionism," European Trade Commissioner Karel de Gucht said, stressing that this would be the EU's message at the G20 summit of major industrialised and developing economies in Seoul this week.

"I will act against the worst protectionist measures established by other countries," he said as he unveiled his trade policy for the next five years.

In a 23-page document for EU states and the EU parliament, the European Commission said completing the Doha round of trade talks was a top priority and that it aimed to conclude negotiations by the end of 2011 "at the latest."

The Doha talks began in 2001 with a focus on dismantling obstacles to trade for poor nations.

But discussions have been dogged by discord, including over how much the United States and the EU should reduce aid to their farmers and the extent to which countries such as India and China should lower import tariffs.

A deal could increase world trade by more than 300 billion euros a year and world income by more than 135 billion euros, the EU executive said.

The commission said 2011 "represents the next best opportunity to conclude an ambitious, balanced and comprehensive agreement to which all major players make significant contributions and from which all players, big and small, could benefit."

German Chancellor Angela Merkel also called for a Doha deal next year as a way to combat protectionism.

"The greatest danger that threatens us is protectionism, and we are still not taking enough steps to ensure genuinely free trade," she told the Financial Times.

The European Commission also proposed steps to improve access for European businesses to government contracts abroad.

The policy paper states that the European Commission will propose legislation next year to create an EU instrument to "secure improved symmetry in access to public procurement markets" in large emerging economies.

European companies regularly complain about difficulties in accessing public markets in such countries as China.

"We need to help European businesses of all sizes to access global markets," de Gucht told a news conference.

"Where the EU is open, such as in public procurement, we need to ensure European businesses can benefit from the same terms of access to our partner's markets," he said.

"Where Europe's openness is not matched elsewhere, I want to redress that balance."

But any retaliatory measures should be "moderate" and "sector specific," he said.

"I don't believe that bluntly closing our procurement markets would be a good idea," he said.

"It should be sectoral, specific and aimed at practices that we cannot accept from third countries."

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