In her first term, von der Leyen’s Commission sought to attach human rights and green conditions to trade deals — which proved to be more than its partners were prepared to take. As a result, a trip in late 2023 to seal a Latin American trade deal was called off at the last minute. Another, with Australia, collapsed after EU bigwigs flew around the world for a signing ceremony that never happened.
The setbacks exposed von der Leyen’s lofty first-term trade aspirations as unrealistic. A shift in mindset has been on full display in the weeks leading up to Trump’s inauguration.
“My view from the last two months, and I think it was also very clearly confirmed here in the last two days in Davos, is that there is enormous interest in accelerating free trade negotiations with the European Union,” Šefčovič told POLITICO at the World Economic Forum when asked in an interview whether he perceived a shift in the EU’s trade policy.
Trump hasn’t yet followed through on his campaign threats to impose universal tariffs of 10 to 20 percent on the rest of the world — and more for Canada, Mexico and China. But the mere prospect has had a galvanizing effect.
“Trump does — unintentionally — help to facilitate trade agreements between the EU and third parties. You can see there is a change of mind, a certain new dynamic,” said an EU diplomat who, like others in this story, was granted anonymity to speak candidly.
Reality check
After two decades of back-and-forth on Mercosur, a South American trade bloc, the European Commission sealed a political deal in early December. In one major concession, it agreed that parties can seek compensation over losses arising from strict EU regulations, such as one aimed at curbing deforestation. This so-called rebalancing mechanism was a first for an EU trade deal, said a senior EU official.