Jakarta: America's protectionist stance and rising tariff tensions with trading partners is a wake-up call to Europe and ASEAN to renew bilateral economic relations and take their trade and investment linkages to a significantly higher level. Exhorting that global trade situation was no longer business as usual, EU Ambassador to ASEAN Sujiro Seam said the remedy now was for both regions to move away from the United States to counter Washington's heavy-handedness.

According to BERNAMA News Agency, Seam emphasized the need for both regions to diversify their partnerships, highlighting the importance of focusing on the 87 per cent of the global economy that is not the US. This focus is crucial as both regions uphold multilateral trade principles and aim to avoid the risks of economic fragmentation. The tensions have been exacerbated by President Donald Trump's imposition of a 20 per cent blanket Liberation Day tariff on the EU in April, straining Washington-Brussels relations. Although a trade deal in July reduced these tariffs to 15 per cent, Seam underscored the importance of focusing on domestic markets, especially increasing intra-ASEAN trade.

The EU, with a consumer base of 744 million people, and ASEAN, with a populace of 680 million, have significant potential for growth. However, while intra-European trade constitutes 60-70 per cent of total trade, intra-ASEAN trade remains at only 20-25 per cent. Seam noted the need for better integration within the ASEAN market to enhance economic resilience and growth.

Addressing concerns regarding the EU's stringent environmental and sustainability standards, Seam clarified that these standards are designed to ensure a level playing field in the European single market. The EU's integrated market of 27 member states operates under a unified set of rules applicable to both European businesses and international exporters. These standards, covering issues like palm oil, deforestation, and carbon border mechanisms, are essential for maintaining transparency and facilitating trade in global supply chains. Exporters must adhere to these regulations to access the EU market, which Seam emphasized is comparable to market regulations worldwide.

Ultimately, Seam highlighted that while exporters might view such standards as obstacles, they are intended to facilitate trade and ensure a fair competitive environment. He reiterated that the EU's unified standards since 1957 apply equally to all exporters, underscoring the importance of compliance for market access.