In theory, we have few reservations regarding free trade. Given optimum conditions, free trade as set forth in the EUs Four Freedoms, can have great cultural and economic benefits.
But free trade can also be detrimental to the local areas within an economic union when local interests are not protected. Hence, a market economy needs regulations to protect the interests of local economies, the environment and local cultures. Currently, this is often not the case within the EU.
Take the case of fishing. The fishing industry has a long tradition in Europe and is deeply tied to local culture, economy and the environment Such as in Norway, where the support of fishermen and farmers helped to ensure a NO vote in the EU referendums of 1972 and 1994.
The argument put forward against EU membership was that it would not be wise to allow fishing boats from other countries to compete with local fishermen—it would wipe out the industry, they feared. Today the Norwegian fishing industry is as healthy as ever, with exports to over 150 countries and exceeding 3 thousand tons per year. In contrast, Great Britain joined the EU and that country’s fishing industry has not feared so well. Spain has Europe’s biggest fleet and the largest
The Poseidon Aquatic Resource Management consultancy and Pew Environment Group found that EU subsidies had been linked to overfishing. They analyzed data from the EU’s Financial Instrument for Fisheries Guidance (FIFG), which paid almost £4 billion in fishing subsidies between 2000-2006. The worst offenders were Spain, Portugal and France, who used subsidy payments to increase fleet capacity in Europe and ‘exacerbate’ the problem of overfishing of depleted stocks such as cod and bluefin tuna.
Petyo Ivanov from the village of Razhevo produces cheese, but says he is not selling it due to all the “administration and documentation.” The overwhelming bureaucracy makes him question the whole purpose and sustainability of small farming within the EU, as the regulations favor large, industrialized farming operations over, small local farms.
Dessislava Dimitrova, an organizer with the Slow Food Movement in the Balkans, believes all Bulgarian small farms face the obstacles Ivanov described. “As a result of the formal operations of EU regulations, the small producers, the family farms, have actually been deprived of the opportunity to produce and sell their products, and we, consumers, have been deprived of our right to choose – whether to buy industrially-produced foods offered by international chains or opt for healthy foods that we really like,” Dimitrova said.
EU foreign trade policies, which are generally in line with WTO policies, also effect local economies outside its borders, such as in Africa. These policies represent a resource war, which has intensified even more after the European finance crisis.
“The countries in the North,” according to Ugandan economist Yash Tandon, “are trying to export their economic crisis to the South through trade.” This kind of trade is leading to a state of deindustrialization in Africa. It forces the countries in the South to export cheap raw materials to the EU and the USA to safeguard higher profits for Western corporations.
There are indeed often big gaps between the rhetoric of free trade policy makers and what takes place in the real world. Free trade often does not deliver what it promises, not even within the EU and the rest of Western world.
It has promised growth, but growth has actually slowed down in the past two and a half decades after trade liberalization policies have been aggressively enacted world wide. Secondly, the war on resources and local economies that the Africans complain about, is also happening within the EU itself, as seen in the rapid depletion of fish stocks and in the rapid decline of small farms and agro-industries.