MEMORANDUM ON EU POLICY
Doha Round: EU Policy on Non-Agricultu
Of this total, over 55 percent of imports and nearly two-thirds of exports are manufactured goods, while agricultural goods account for only six percent of imports and five percent of exports ("EU Trade" 1). European Union trade is widely distributed, with the United States and Japan together -- the other two largest economies -- accounting for only about a third of total imports and exports ("EU Trade" 1).
The EU policy agenda for the Doha round has the three main components named above: compression of tariffs, increased binding of tariffs, and favored treatment for environmental goods. These three components may be defined as follows.
Compression: Compression means reducing the range of tariffs, reducing both tariff "peaks" and "escalation." A tariff peak may be characterized as a tariff on one member or subclass of a range of trade goods that is markedly higher than tariffs on the broader range of similar range. An example given (perhaps hypothetical) of a tariff peak would be a tariff of 50 percent on imports of cotton textiles, where tariffs on textile imports in general are only 5 percent ("Market Access" 1). Such peaks are generally designed to favor a particular domestic industry; in the example above, the protected industry is by implication cotton production.
"Escalation" refers to a tariff schedule in which higher tariffs are charged against goods that embody greater value added -- for example, a higher tariff on candy bars