EU Trade and Forced Labour

17.01.2023

WIFO Collaborated on Study for the European Parliament

The European Commission has recently proposed to ban the products in the EU Single Market that have been produced in forced labour. This proposal is now discussed in a study by WIFO, co-authored with VVA Brussels.

Cécile Jacob and Pierre Hausemer (VVA Brussels), together with Klaus Friesenbichler and Birgit Meyer (WIFO), explore the question of how EU economic policy instruments can be designed to prevent trade in products produced in forced labour.

The report compares the option of an EU import ban on goods produced with forced labour with a marketing ban of such products. The research team analyses the likely economic and social impacts of the proposed measures, both inside and outside the EU. The legal feasibility of the instruments is also examined. The results show that forced labour is a complex phenomenon and neither an import ban nor a marketing ban might sufficiently eradicate forced labour at its roots.

The EU Commission's proposal covers all products, regardless of whether they are imported from third countries, produced in the EU for domestic consumption or exported. The specific implementation is challenging, as forced labour in third countries mainly occurs in the private sector, although in some cases it is mandated by the state. The authors suggest that companies, especially small and medium-sized companies (SMEs), should be supported in the implementation process. Economic policy instruments should be effective tools against the import and circulation of forced labour products on the European internal market. This will support the implementation of the European Commission's global decent work initiative.

 

Publications

Studies, European Parliament, Brussels, November 2022, 53 pages, https://www.europarl.europa.eu/RegData/etudes/IDAN/2022/702570/EXPO_IDA(2022)702570_EN.pdf
Commissioned by: European Parliament
Study by: Austrian Institute of Economic Research – Copenhagen Economics – Valdani Vicari & Associati Srl
Online since: 12.01.2023 0:00
This in-depth analysis explores how EU trade policy tools can effectively tackle the import and circulation of forced labour products in the European single market in order to help implement the Commission's decent work worldwide initiative. The report compares the option of an EU import ban on forced labour goods to the option of prohibiting the marketing of such products, in light of the Commission's proposal for a Regulation on prohibiting products made with forced labour on the Union market published on 14 September 2022. The paper also analyses the likely economic and social impact of the proposed measures (in the EU and abroad), as well as the legal feasibility of these tools.
Please contact

Dr. Klaus Friesenbichler

Research groups: Industrial Economics, Innovation and International Competition

Dr. Birgit Meyer, MSc

Research groups: Industrial Economics, Innovation and International Competition
© Lidya Nada/Unsplash
© Lidya Nada/Unsplash