1 00:00:02,520 --> 00:00:09,240 Speaker 1: Bloomberg Audio Studios, podcasts, radio News. We're here joined by Marosofkovic, 2 00:00:09,280 --> 00:00:11,240 Speaker 1: who is the Trade Commissioner for the European Union. We 3 00:00:11,240 --> 00:00:13,080 Speaker 1: have so much to talk about about the relationship with 4 00:00:13,119 --> 00:00:15,920 Speaker 1: the United States, China, Mercos or this Latin American trade 5 00:00:15,960 --> 00:00:17,720 Speaker 1: deal that's supposed to be signed this weekend. We'll see 6 00:00:17,760 --> 00:00:19,680 Speaker 1: if we get to that. Commissioner, thank you so much 7 00:00:19,680 --> 00:00:21,560 Speaker 1: for joining us here. I'd like to begin with the 8 00:00:21,600 --> 00:00:23,520 Speaker 1: negotiations with the United States, because I think a lot 9 00:00:23,560 --> 00:00:25,439 Speaker 1: of people are not very clear on where we are, 10 00:00:25,480 --> 00:00:29,120 Speaker 1: particularly on the negotiations for stealing aluminum thus fifty percent tariffs. 11 00:00:29,240 --> 00:00:31,120 Speaker 1: What progress has main where are we right now? 12 00:00:31,440 --> 00:00:34,120 Speaker 2: I was very pleased with the outcome of the visit 13 00:00:34,200 --> 00:00:38,640 Speaker 2: of my two principal counterparts, Secretary Latnique and Amasada Grier, 14 00:00:39,040 --> 00:00:41,760 Speaker 2: and I think we kind of reconfirm also in front 15 00:00:41,760 --> 00:00:44,479 Speaker 2: of the our industry because we had the meeting with 16 00:00:44,640 --> 00:00:47,320 Speaker 2: CEOs that if it comes to steal and steal products 17 00:00:47,360 --> 00:00:49,319 Speaker 2: but not each other problem because we export to each 18 00:00:49,360 --> 00:00:52,919 Speaker 2: other really minimum amounts. But what unites us is that 19 00:00:52,960 --> 00:00:56,240 Speaker 2: we needly need to take care of over capacities which 20 00:00:56,280 --> 00:01:00,960 Speaker 2: are destroying the steel production. As also in the EU, 21 00:01:01,440 --> 00:01:05,679 Speaker 2: and I explain again that we adopted these very far 22 00:01:05,760 --> 00:01:09,800 Speaker 2: reaching safeguards if it comes to the imports of steel 23 00:01:09,840 --> 00:01:12,320 Speaker 2: from the third countries to the EEL, which are kind 24 00:01:12,319 --> 00:01:17,600 Speaker 2: of very much reflecting the measures which US has undertaken 25 00:01:17,640 --> 00:01:20,679 Speaker 2: several months ago. And therefore I suggested again let's go 26 00:01:20,760 --> 00:01:24,640 Speaker 2: back to the idea where we can kind of build 27 00:01:25,080 --> 00:01:29,200 Speaker 2: this ring of friends where we would trade on MFM 28 00:01:30,400 --> 00:01:33,360 Speaker 2: or zero levels and we will have the same, let's say, 29 00:01:33,800 --> 00:01:36,240 Speaker 2: measures to take on the global over capacities. 30 00:01:37,120 --> 00:01:40,319 Speaker 3: The situation as it stays right. 31 00:01:40,240 --> 00:01:46,960 Speaker 2: Now is that I sent to Secret Latin the lists 32 00:01:47,319 --> 00:01:52,240 Speaker 2: of the codes where we believe that we can definitely 33 00:01:52,560 --> 00:01:56,440 Speaker 2: lower the tariffs. I understand there is some interest, especially 34 00:01:57,360 --> 00:02:01,160 Speaker 2: from the machinery machinary sector, but we didn't proceed or 35 00:02:01,160 --> 00:02:04,320 Speaker 2: having proceeded to the very concrete negotiations on this type. 36 00:02:04,320 --> 00:02:05,880 Speaker 3: So we're talking on the level of teams. 37 00:02:06,080 --> 00:02:08,240 Speaker 2: We are almost i would say, in peramanunt in contact 38 00:02:08,240 --> 00:02:10,760 Speaker 2: with my counterparts, and I think this would be good 39 00:02:10,800 --> 00:02:13,279 Speaker 2: for both sets, because if America wants to re industrialize, 40 00:02:13,440 --> 00:02:14,280 Speaker 2: they need machines. 41 00:02:14,360 --> 00:02:15,360 Speaker 3: We produce them machines. 42 00:02:15,360 --> 00:02:17,080 Speaker 2: We are ready to send them the machines but of 43 00:02:17,080 --> 00:02:20,000 Speaker 2: course we need to find the solution on the derivatives. 44 00:02:20,000 --> 00:02:22,240 Speaker 1: And when Secretary Lotnik was here, we caught up with him. 45 00:02:22,280 --> 00:02:24,440 Speaker 1: He came on Bloomberg Television and he said that basically, 46 00:02:24,480 --> 00:02:26,880 Speaker 1: in order to make progress on steal and aluminum, there 47 00:02:26,919 --> 00:02:30,720 Speaker 1: needs to be movement on regulations for digital industry. So basically, 48 00:02:30,800 --> 00:02:33,280 Speaker 1: stuff that's outside of trade that the United States considers 49 00:02:33,880 --> 00:02:37,600 Speaker 1: non trade barriers or non tariff barriers within is that 50 00:02:37,639 --> 00:02:40,079 Speaker 1: something that is on the table in terms of the negotiation. 51 00:02:40,160 --> 00:02:42,320 Speaker 1: Could that be part of a framework and is there 52 00:02:42,360 --> 00:02:44,639 Speaker 1: any other avenue to get those tears down other than 53 00:02:44,800 --> 00:02:46,919 Speaker 1: basically diminishing European tech regulation. 54 00:02:47,320 --> 00:02:52,840 Speaker 2: I think that our regulation is adopted democratically by US 55 00:02:53,120 --> 00:02:58,080 Speaker 2: through very thorough legislative process, and therefore we are of 56 00:02:58,080 --> 00:03:01,920 Speaker 2: course going to protect our text sovereignity. What I heard 57 00:03:03,080 --> 00:03:06,120 Speaker 2: from Secretary Latin and Amasatagreer was that they wanted to 58 00:03:06,160 --> 00:03:09,120 Speaker 2: be treated fairly. So we had a lot of discussions. 59 00:03:09,760 --> 00:03:13,680 Speaker 2: Are we aiming only at the US Company's clear answer 60 00:03:13,760 --> 00:03:17,680 Speaker 2: is no, Just just look at the companies which we 61 00:03:17,720 --> 00:03:22,880 Speaker 2: are investigating or eventually funny and are we kind of, 62 00:03:22,919 --> 00:03:26,919 Speaker 2: you know, favoring the European companies in this case. Again no, 63 00:03:27,120 --> 00:03:32,040 Speaker 2: and I was just providing my both counterparts with the 64 00:03:32,080 --> 00:03:36,600 Speaker 2: fact that a lot of of these investigations are actually 65 00:03:36,640 --> 00:03:39,960 Speaker 2: prompted by the complaints which are coming from American companies 66 00:03:40,000 --> 00:03:43,880 Speaker 2: which are also located here in the They want to 67 00:03:43,920 --> 00:03:47,200 Speaker 2: make sure that US companies have treated fairly in non 68 00:03:47,240 --> 00:03:51,680 Speaker 2: discriminatory manner. When we would use more I would say, 69 00:03:51,680 --> 00:03:54,800 Speaker 2: the possibility of the of the settlement than fines, and 70 00:03:54,880 --> 00:03:57,880 Speaker 2: all these things been also discussed with American partners, also 71 00:03:57,920 --> 00:04:02,480 Speaker 2: by my colleagues who are responsible for these sectors. 72 00:04:02,920 --> 00:04:05,320 Speaker 1: And speaking of sort of rare earth minerals is obviously 73 00:04:05,320 --> 00:04:07,600 Speaker 1: it has been thrust into this sort of the conversation 74 00:04:07,760 --> 00:04:10,160 Speaker 1: very in a very sort of obvious way. Now by 75 00:04:10,160 --> 00:04:10,600 Speaker 1: the China. 76 00:04:10,720 --> 00:04:11,480 Speaker 3: Are we getting closer? 77 00:04:11,560 --> 00:04:13,680 Speaker 1: Is Europe getting closer to getting a general license from 78 00:04:13,760 --> 00:04:15,360 Speaker 1: China as the United States has? 79 00:04:16,120 --> 00:04:19,000 Speaker 2: Yes, I think that there I can say that we 80 00:04:19,080 --> 00:04:24,239 Speaker 2: are in a very close contacts with Foreign Trade Minister 81 00:04:24,360 --> 00:04:26,800 Speaker 2: Mankmental and also his team, so we are communicating on 82 00:04:26,839 --> 00:04:31,440 Speaker 2: different levels. We had here the team from China specializing 83 00:04:31,440 --> 00:04:34,279 Speaker 2: on export controls like a couple of weeks ago, and 84 00:04:34,800 --> 00:04:37,839 Speaker 2: I think we are getting initial reports from our industry 85 00:04:37,920 --> 00:04:40,680 Speaker 2: that they are getting these general licenses, but we need 86 00:04:40,760 --> 00:04:45,359 Speaker 2: to have a little bit more granual information. 87 00:04:46,080 --> 00:04:47,640 Speaker 3: To evaluid the whole process. 88 00:04:47,680 --> 00:04:52,640 Speaker 2: But the fact that this idea was favorably received, that 89 00:04:52,960 --> 00:04:55,240 Speaker 2: it seems that we are getting first general licenses, and 90 00:04:55,279 --> 00:04:59,680 Speaker 2: also that the Chinese side was receptive to our arguments 91 00:04:59,680 --> 00:05:03,719 Speaker 2: that the processes it was set up in April required 92 00:05:04,040 --> 00:05:06,800 Speaker 2: too much of a it's a very intrusive information, too 93 00:05:06,880 --> 00:05:10,320 Speaker 2: many photographs, too much detail about the supply chains, and 94 00:05:10,320 --> 00:05:14,360 Speaker 2: and I think that the general licensing could be could 95 00:05:14,400 --> 00:05:16,839 Speaker 2: be one of the solutions out to address this issue. 96 00:05:16,880 --> 00:05:18,400 Speaker 1: Does that mean that there's going to be a regime 97 00:05:18,440 --> 00:05:20,719 Speaker 1: that governs this sort of issue between the EU and 98 00:05:20,800 --> 00:05:22,760 Speaker 1: China or is it still just kind of being hopeful 99 00:05:22,800 --> 00:05:23,839 Speaker 1: that things don't change. 100 00:05:23,880 --> 00:05:27,480 Speaker 3: Basically, I think that we kind of. 101 00:05:29,640 --> 00:05:33,120 Speaker 2: Set up the kind of hotline with the Minister a 102 00:05:33,160 --> 00:05:37,760 Speaker 2: Bankmentao FOROL priority cases. So we are talking on our 103 00:05:37,839 --> 00:05:42,640 Speaker 2: level quite regularly, but especially our teams are in permanent contacts, 104 00:05:42,720 --> 00:05:46,080 Speaker 2: because indeed, we had the moments over the last year 105 00:05:46,200 --> 00:05:49,320 Speaker 2: where on my table I saw that pile of the 106 00:05:49,400 --> 00:05:51,800 Speaker 2: of the of the of the letters from the warried 107 00:05:51,920 --> 00:05:56,080 Speaker 2: CEOs of different new companies about the lack of permanent 108 00:05:56,160 --> 00:05:58,200 Speaker 2: magnets like of legacy chips and so on and so 109 00:05:58,240 --> 00:06:02,200 Speaker 2: forth was really growing quite rapidly and we needed to 110 00:06:02,240 --> 00:06:04,279 Speaker 2: address it. So now I think that we set up 111 00:06:04,279 --> 00:06:06,640 Speaker 2: the good channels on working level and political level to 112 00:06:07,000 --> 00:06:07,920 Speaker 2: address this issue. 113 00:06:08,000 --> 00:06:09,320 Speaker 3: But it's a challenge. 114 00:06:09,720 --> 00:06:13,520 Speaker 2: It brings additional instability into how the global supply chain 115 00:06:13,520 --> 00:06:16,040 Speaker 2: has been working, and therefore my message to the European 116 00:06:16,080 --> 00:06:20,280 Speaker 2: industry is you have to be prepared to pay security premium. 117 00:06:20,360 --> 00:06:20,840 Speaker 3: We have to. 118 00:06:20,839 --> 00:06:24,640 Speaker 2: Stockpile, we have to diversify, because we learned the hard 119 00:06:24,680 --> 00:06:29,839 Speaker 2: way how the dependencies are costly, and therefore we included 120 00:06:29,880 --> 00:06:33,600 Speaker 2: it into this new look, new communication on economic security 121 00:06:33,880 --> 00:06:37,640 Speaker 2: because weach simply have to be much better in managing 122 00:06:37,640 --> 00:06:38,320 Speaker 2: these emergencies. 123 00:06:38,400 --> 00:06:41,000 Speaker 1: And one of the costs of imbalance and the sort 124 00:06:41,040 --> 00:06:43,960 Speaker 1: of dependencies has been sort of evident in the trade 125 00:06:43,960 --> 00:06:46,520 Speaker 1: balance with China and something that Emmanuel and Macron has 126 00:06:46,520 --> 00:06:48,919 Speaker 1: been very critical of, particularly in the last week or 127 00:06:48,920 --> 00:06:51,119 Speaker 1: so after his visit to Beijing, saying that there should 128 00:06:51,120 --> 00:06:53,880 Speaker 1: be a more aggressive approach to dealing with the oversupply 129 00:06:53,960 --> 00:06:55,720 Speaker 1: that is going into Europe. Do you think there is 130 00:06:55,760 --> 00:06:58,680 Speaker 1: appetite to deal more aggressively with this question from China, 131 00:06:58,680 --> 00:07:00,960 Speaker 1: And do you think that the trade deforicit with China 132 00:07:01,000 --> 00:07:03,760 Speaker 1: specifically should be targeted by the EU and that is 133 00:07:03,800 --> 00:07:05,320 Speaker 1: something that they should be looking to close. 134 00:07:05,839 --> 00:07:09,640 Speaker 2: Clearly, I would say the deficit of three hundred billion 135 00:07:09,800 --> 00:07:13,240 Speaker 2: is way too high. This was the topic which was 136 00:07:13,600 --> 00:07:17,120 Speaker 2: raised by me with my counterparts from the moment one 137 00:07:17,160 --> 00:07:22,320 Speaker 2: when I first time came for the visit to China. 138 00:07:23,000 --> 00:07:27,680 Speaker 2: And I think that there's also very clear message from 139 00:07:27,680 --> 00:07:29,640 Speaker 2: our side that we'll fight tooth and nail for our 140 00:07:29,680 --> 00:07:33,240 Speaker 2: European jobs and European European companies and to have the 141 00:07:33,280 --> 00:07:37,120 Speaker 2: deficit of three hundred billion on permanent basis unsustainable. So 142 00:07:37,160 --> 00:07:42,360 Speaker 2: we are looking at different possibilities how to address this issue. 143 00:07:42,440 --> 00:07:45,320 Speaker 2: Maybe one interesting information for you would be that we 144 00:07:45,400 --> 00:07:49,640 Speaker 2: set up such as import surveillance taskcores which are monitoring 145 00:07:49,880 --> 00:07:53,440 Speaker 2: I would say, the inflows of the goods on bibyicle basis, 146 00:07:53,480 --> 00:07:56,640 Speaker 2: and this is what constitutes I would say, the basis 147 00:07:56,640 --> 00:07:57,480 Speaker 2: for our next steps. 148 00:07:57,520 --> 00:07:59,720 Speaker 1: And if three hundred and fifty billion is too high 149 00:08:00,080 --> 00:08:01,840 Speaker 1: for you, is a more reasonable figure? What is the 150 00:08:01,920 --> 00:08:04,080 Speaker 1: kind of goal? So we can think talk concretely about 151 00:08:04,160 --> 00:08:06,040 Speaker 1: kind of what we should be aiming for, and is 152 00:08:06,080 --> 00:08:08,760 Speaker 1: the anti coursion device, for example, something that is on 153 00:08:08,760 --> 00:08:10,480 Speaker 1: the table and trying to achieve that goal. 154 00:08:10,720 --> 00:08:14,520 Speaker 2: I think that before we went to I would say 155 00:08:15,040 --> 00:08:20,920 Speaker 2: the most I would say to the strongest, strongest instrument 156 00:08:20,960 --> 00:08:24,200 Speaker 2: in our arsenal. What would be very important for us 157 00:08:24,240 --> 00:08:27,680 Speaker 2: would be to see the tendencies. Are the European companies 158 00:08:27,680 --> 00:08:30,120 Speaker 2: in China treated fairly? 159 00:08:30,520 --> 00:08:33,480 Speaker 3: Do we have access, you know, to. 160 00:08:33,400 --> 00:08:37,560 Speaker 2: Some of the programs and public procurement, how the issue 161 00:08:37,559 --> 00:08:43,079 Speaker 2: of the handling of overcapacity is happening and the investments 162 00:08:43,120 --> 00:08:45,240 Speaker 2: are done in you are the real investment? Are we 163 00:08:45,280 --> 00:08:48,040 Speaker 2: talking about the I p R transfer? Are we talking 164 00:08:48,040 --> 00:08:51,199 Speaker 2: about creating real valuated in Europe? Are we talking about 165 00:08:51,200 --> 00:08:53,400 Speaker 2: creation of the of the real job? So what would 166 00:08:53,400 --> 00:08:57,120 Speaker 2: be very important is the tendency and I would say 167 00:08:57,160 --> 00:09:00,839 Speaker 2: engagement with us to address this The issues which you 168 00:09:00,880 --> 00:09:04,000 Speaker 2: are raising without Chinese counterparts really already for quite some. 169 00:09:03,960 --> 00:09:06,520 Speaker 1: Time, and it seemed going into sort of at the 170 00:09:06,600 --> 00:09:08,080 Speaker 1: end of last week or in the middle of last week, 171 00:09:08,120 --> 00:09:10,160 Speaker 1: that Mercosore was more or less a done deal. There 172 00:09:10,200 --> 00:09:12,199 Speaker 1: now appears to be some question about that. What do 173 00:09:12,240 --> 00:09:14,600 Speaker 1: you think are the chances that Mercosore goes into the 174 00:09:14,679 --> 00:09:16,559 Speaker 1: fact that it is signed this weekend. 175 00:09:16,920 --> 00:09:20,840 Speaker 2: They're going to use every every every minute of this 176 00:09:20,920 --> 00:09:25,000 Speaker 2: week to get it done, because I think to end 177 00:09:25,559 --> 00:09:29,720 Speaker 2: this turbulent year from the perspective of the such a 178 00:09:29,720 --> 00:09:33,400 Speaker 2: global trader like European Union with the biggest free trade 179 00:09:33,440 --> 00:09:37,960 Speaker 2: agreement ever signed, I think would be a positive conclusion 180 00:09:38,000 --> 00:09:43,000 Speaker 2: to this year. That's a big deal with lots of 181 00:09:43,080 --> 00:09:46,920 Speaker 2: opportunities for not only European exporters but also in the 182 00:09:46,920 --> 00:09:52,319 Speaker 2: field of critical row minimals, accessibility, and I'm sure that 183 00:09:52,360 --> 00:09:54,400 Speaker 2: in the end it would be very positive deal also 184 00:09:54,480 --> 00:09:58,200 Speaker 2: for our ugly food industry, which is paying very high 185 00:09:58,200 --> 00:10:01,360 Speaker 2: tiives if they tried to export anything to Americos. So 186 00:10:01,480 --> 00:10:05,600 Speaker 2: we really very diligently listen to our farmer's community, and 187 00:10:05,679 --> 00:10:09,040 Speaker 2: I believe that we found the responses to every single 188 00:10:09,080 --> 00:10:09,880 Speaker 2: concern they had. 189 00:10:10,640 --> 00:10:12,599 Speaker 3: I just hope that they will look at it carefully. 190 00:10:13,160 --> 00:10:14,439 Speaker 3: We are ready to explain it. 191 00:10:14,559 --> 00:10:17,600 Speaker 2: We are discussing it with our member states in the Parliament, 192 00:10:17,800 --> 00:10:19,959 Speaker 2: and I hope that we'll end up on the positive note. 193 00:10:19,760 --> 00:10:22,280 Speaker 1: And just very quickly after twenty five years of negotiation, 194 00:10:22,320 --> 00:10:24,080 Speaker 1: which is how long this has sort of been going place. 195 00:10:24,120 --> 00:10:25,520 Speaker 1: If we do not get it over the line in 196 00:10:25,520 --> 00:10:28,440 Speaker 1: this next couple of weeks, can we consider this sort 197 00:10:28,440 --> 00:10:29,920 Speaker 1: of initiative to be dead. 198 00:10:30,640 --> 00:10:33,680 Speaker 2: Let's think positive, and I would never accept such a 199 00:10:33,679 --> 00:10:40,520 Speaker 2: good deal like we negotiate it between Mercosur and European Union. 200 00:10:41,000 --> 00:10:43,000 Speaker 2: Is dead because it's just simply too good for our 201 00:10:43,040 --> 00:10:44,640 Speaker 2: citizens and too good for our businesses.