- Trade topics
- Economic security
To address these challenges, the EU is ready to use its trade policy tools to help improve economic security for businesses and consumers alike.
The EU remains open to the world. Yet when supply chain vulnerabilities and critical dependencies are used as geopolitical weapons, EU trade policy must find new means to harness globalisation while reducing strategic dependencies.
Risks related to critical technologies, concentrated supply chains, dependence on suppliers from certain countries, and the weaponisation of economic relationships can all affect the EU’s economic resilience, economic growth, and technological leadership. By extension, this can affect the ability of the EU and its Member States to deliver on democratically agreed policy priorities.
The EU is operating in an increasingly complex environment, which demands new policies.
Resilient and diverse supply chains
The EU is moving towards more proactive and systematic deployment of its policy toolbox as it seeks to de-risk its supply chains.
The Commission is currently exploring ways of enhancing the EU’s resilience – reflecting on how to help companies diversify their supply chains for strategic technologies, products or industrial inputs. This will lead to an economic resilience policy package – including a new diversification instrument, foreseen by the end of 2026.
Capitalising on EU trade agreements
Trade agreements strengthen the EU's geopolitical presence in a challenging international environment and encourage the diversification of imports, exports and investment flows. For example, they can provide predictable sources for raw materials, energy-related products, or of other goods that are of strategic importance to the EU economy.
Preferential trade partners already supply a quarter of the EU’s imports of critical raw materials.
- More on EU trade relationships by country/region
- More on raw materials
How EU trade policy improves economic security
Open, rules-based trade helps to grow businesses and create jobs – provided that fair competition is maintained between domestic and foreign companies. When trade is found to be taking place unfairly, the EU can turn to several policy instruments that help to restore fairness and a level economic playing field.
The EU uses various tools to enforce the commitments it negotiates to benefit companies, workers and consumers under trade agreements. Collectively, these tools are referred to as trade defence instruments.
The European Commission, for example, is responsible for investigating allegations of dumped and subsidised imports from third countries into the EU that may be harming EU-based producers.
Countries sometimes seek to pressure the EU or its Member States into making certain choices by applying, or threatening to apply, measures that affect trade or investment. Such behaviour constitutes economic coercion.
Protection and enforcement of intellectual property rights are crucial for the EU's ability to stimulate innovation and to compete in the global economy.
Screening of foreign direct investment (FDI) into the EU and export controls on dual-use goods are core components of the EU’s broader economic security strategy, which seeks to reduce vulnerabilities arising from geopolitical tensions, technological competition and economic dependencies, while preserving the EU’s openness to trade and investment.
FDI screening seeks to prevent foreign investments from creating security or public-order risks resulting from access to strategic companies, technologies, infrastructure, or know-how.
- More on investment screening
Export controls on dual-use goods, by contrast, address risks arising from the outward transfer of goods, software and technology that can serve both civilian and military purposes, helping prevent technology diversion, proliferation and other security risks.
Together, these instruments constitute a protective economic security toolkit, alongside outbound investment monitoring, measures to protect research funding, supply-chain diversification, and cooperation with international partners – allowing the EU to manage strategic dependencies and technology leakage without abandoning its commitment to an open and competitive economy.
- More on exporting dual-use items
Further information on economic security
- More on enforcement and protection
- More on trade defence
- More on dispute settlement
