"Jean-Claude Juncker did a good job"

"Jean-Claude Juncker fought well in a triangle: he is with the United States when it is necessary to put pressure on China and it is with China when it is necessary to put pressure on the United States " estimates Pascal Lamy, former director general of the World Trade Organization (WTO ) and honorary president of the Jacques Delors Institute, Thursday 26 July on franceinfo. He returns to the discussions between Jean-Claude Juncker and Donald Trump that same day

franceinfo: What to read between the lines of Emmanuel Macron's speech?

Pascal Lamy : In Macron's remarks, we must read a certain number of precautions, which are traditional in French positions, as far as Community commercial policy is concerned. In particular, there is a clear desire not to see agriculture as part of these new bilateral talks. There is no reason to be concerned on this point, since yesterday's armistice excludes agriculture, services, cars and vehicles from conversations, which will be limited to a number of industrial goods, including Customs duties are very, very low today. As far as the transatlantic dimension is concerned, it is in no way about starting a grand agreement again. It is a kind of agreement like the one that was imagined three years ago, but reduced by about two-thirds.

What are the stakes of these discussions?

Donald Trump launched a vast offensive by sticking tariffs everywhere with its trading partners, especially on steel and aluminum, because it is quite obsessed – wrongly indeed – by the deficit in the US trade balance, which has lasted for 35 years. He launched this offensive and the President of the European Commission, Mr Juncker, went to Washington to explain that it did not make much sense on a number of topics. Mr. Juncker, before going to Washington yesterday, went to Beijing last week to get the Chinese to accept a multilateral discussion in the WTO, especially between Americans, Europeans, Japanese and Chinese, to improve a number of rules. Americans, Europeans and the Japanese agree that WTO disciplines do not discipline enough Chinese practices and the Chinese have begun to recognize it.

What needs to change at the WTO?

The current rules of the WTO date from the 1990s, so they are between twenty and thirty years of age, in a world that has changed a lot. Twenty years ago, China was a relatively small developing country. It is today one of the giants of world trade. If we take the example of subsidies, normally, in order for international competition to be equal and fair, we can not subsidize our production to export it. WTO rules on this point are weak, difficult to interpret, and in fact allow a number of Chinese practices. The state sector, the part of the Chinese economy directly controlled by the state, represents 30 to 40% of the Chinese economy. So we have to rewrite the rules of the WTO, which can not be done without the Chinese being around the table. That's where Mr. Juncker was smart enough, he did well in a triangle: he is with the United States when it comes to pressure China and he is with China when it comes to pressure on United States. Yesterday's deal is a flip-flop from Mr. Trump, but he's used to change his mind. One of the main reasons for Mr. Trump's flip-flop is the European sanctions, the retaliatory measures that Europe has taken on Harley Davidson or orange juice, for example. They hurt the American economy badly. For the moment, from the European point of view, we are avoiding this war which would continue. I think firmness paid off.