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Begin New Search Topic International Trade and Finance Political Geography North America

81. The Rise of Global Innovation by US Multinationals Poses Risks and Opportunities

Author:
Lee G. Branstetter, Britta Glennon, and J. Bradford Jensen
Publication Date:
06-2019
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics (PIIE)
Abstract:
For decades, US multinational corporations (MNCs) conducted nearly all their research and development (R&D) within the United States. Their focus on R&D at home helped establish the United States as the unrivaled leader of innovation and technology advances in the world economy. Since the late 1990s, however, the amount of R&D conducted overseas by US MNCs has grown nearly fourfold and its geographic distribution has expanded from a few advanced industrial countries to many parts of the developing world, creating an innovation system that spans the globe. Like many aspects of globalization, including the offshoring of manufacturing over recent decades, the globalization of R&D raises concerns about US competitiveness and loss of technological leadership. At the same time, the spreading geographic location of innovation presents opportunities for US-based companies if the right policies are adopted to seize them. The research presented in this Policy Brief demonstrates that US innovators continue to remain involved in important ways in US MNCs' global R&D activities, and fears of a hollowing out of US capacity to innovate—based probably on previous fears about the hollowing out of US-based manufacturing—may be overstated. Indeed, the large and growing pool of highly educated scientists and engineers in the developing world could increase the rate of global productivity growth, to the advantage of US-based companies and the world in general. The authors conclude that a productive way to capitalize on the globalization of MNC R&D is not to oppose it but to combine emerging-market talent with MNC experience so that innovation can flourish to improve global living standards and fuel economic progress.
Topic:
International Trade and Finance, Science and Technology, Multinational Corporations, Risk, and Private Sector
Political Geography:
North America, Global Focus, and United States of America

82. The 2018 US-China Trade Conflict after 40 Years of Special Protection

Author:
Chad P. Bown
Publication Date:
04-2019
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics (PIIE)
Abstract:
In 2018, the United States suddenly increased tariffs on nearly 50 percent of its imports from China. China immediately retaliated with tariffs on more than 70 percent of imports from the United States. This paper assesses what happened in 2018 and attempts to explain why. It first constructs a new measure of special tariff protection to put the sheer scope and coverage of the 2018 actions into historical context. It then uses the lens provided by the 2018 special tariffs to explain the key sources of economic and policy friction between the two countries. This includes whether China’s state-owned enterprises and industrial subsidies, as well as China’s development strategy and system of forcibly acquiring foreign technology, were imposing increasingly large costs on trading partners. Finally, it also examines whether the US strategy to provoke a crisis—which may result in a severely weakened World Trade Organization—was deliberate and out of frustration with the institution itself.
Topic:
Economics, International Trade and Finance, World Trade Organization, Bilateral Relations, Trade Wars, Donald Trump, and Imports
Political Geography:
China, Asia, North America, and United States of America

83. Survival of the International Monetary Fund and Global Economic Cooperation

Author:
Edwin M. Truman
Publication Date:
04-2019
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics (PIIE)
Abstract:
The International Monetary Fund (IMF)—a quota-based institution—faces a test of its survival as the linchpin of the global financial safety net. Its roughly $1.4 trillion in total financial resources is scheduled to begin to shrink in 2020. In 2015, IMF members committed to strengthening IMF financial resources in the 15th General Review of Quotas, which will end in December 2019. Over the past 25 years, the United States has led the way for a gradual redistribution of IMF quota shares toward faster-growing emerging-market and developing countries. Any significant redistribution of quota shares requires an increase in total quotas. Because of its share of votes in the IMF, the United States must agree to any change in quotas. The Trump administration, however, has signaled that it favors no such change. If the United States does not reverse its stance, IMF members will lose an opportunity to strengthen the institution at a time of global financial uncertainty. Truman says the United States could still change its position and recommends how other member countries should press it to do so.
Topic:
International Trade and Finance, Politics, International Monetary Fund, Global Political Economy, Donald Trump, and Economic Cooperation
Political Geography:
North America, Global Focus, and United States of America

84. China’s Territorial Claim at South China Sea: A Strategic Competition with USA and its Implications

Author:
Kanwal Hayat and Rehana Saeed Hashmi
Publication Date:
07-2019
Content Type:
Journal Article
Journal:
South Asian Studies
Institution:
Department of Political Science, University of the Punjab
Abstract:
China claims South China Sea as its sovereign domain where it possesses the right to intervene militarily and economically. However, USA considers South China Sea as a common global passage where rule of law and freedom of navigation should prevail.These diverging viewpoints coexist in a wobbly peace environment where both US and China want their own version of international law to be applied and have occasionally resorted to minor armed conflicts over this issue. Every state claiming authority over South China Sea is willing to use coercion in order to get what they want, however, the extent of how far they are willing to go is not clear. This is resulting in a show of gunboat diplomacy involving maritime force of influential states that strives to manipulate the policy makers of the relevant nations (Costlow, 2012). The paper will focus on the situation in the South China Sea. South China Sea is not only claimed by China but various other Asian nations. Does this territorial strife possess the power to turn the region into a war zone? Being one of the most active trade routes in the world having complicated geography and the diverging regional and international interests makes it very sensitive area. China being the emerging economic giant gives competition to the USA in many spheres. Although America has no territorial claim in the South China Sea, it has strategic and economic interests. Where China wants a complete hegemonic control of the area, USA wants to find a way where free unchecked trade could be the future for all.Accompanied with numerous other South Asian nations claiming various portions of the region, a constant tension exists in the region.
Topic:
Conflict Prevention, Economics, International Trade and Finance, Sovereignty, Territorial Disputes, Hegemony, and Conflict
Political Geography:
China, Asia, North America, United States of America, and Oceans

85. Averting a Global Calamity? Trump and Xi at the G20

Author:
John Edwards
Publication Date:
06-2019
Content Type:
Commentary and Analysis
Institution:
Lowy Institute for International Policy
Abstract:
The outlines of a trade deal between the United States and China are there. But without a return to the negotiating table, the dispute could rapidly escalate, magnifying the damage to world growth. With the Osaka G20 meeting looming, Chinese analysts and policymakers visited in Beijing are pessimistic about the prospects for a trade deal with the United States. If they are right, global financial markets are in for a much wilder shock than anything yet seen in this quarrel. Yet much of a deal has already been agreed, while the consequences of not reaching a deal have become increasingly dire.
Topic:
International Relations, International Trade and Finance, Trade Wars, and Trade
Political Geography:
China, Asia, North America, and United States of America

86. East Asia's Decoupling

Author:
Roland Rajah
Publication Date:
01-2019
Content Type:
Commentary and Analysis
Institution:
Lowy Institute for International Policy
Abstract:
East Asia is no longer reliant on US or Western markets to fuel its growth, giving it more room to manage amid global trade tensions. Heightened global trade tensions and the US desire to ‘decouple’ from the Chinese economy for national security reasons pose significant risks to East Asia’s export-driven growth model. However, the latest data suggests East Asia is no longer so dependent on exporting to the West, with China in particular eclipsing the United States as the leading source of ‘final demand’ for the rest of the region’s exports. This gives East Asia much greater room to manoeuvre, as regional integration is now a more viable platform for growth while US decoupling efforts will likely struggle to find traction in the region.
Topic:
Economics, International Trade and Finance, Global Markets, and Exports
Political Geography:
China, East Asia, Asia, North America, and United States of America

87. U.S. Trade Policy in North America, China, and Beyond

Author:
Andy Green and Daniella Zessoules
Publication Date:
02-2019
Content Type:
Working Paper
Institution:
Center for American Progress - CAP
Abstract:
In recent decades, economic, political, and technological barriers to international trade and investment have collapsed around the world. This rapid globalization of commerce has lifted many out of poverty in developing countries, but due in part to a lack of meaningful labor and environmental standards and enforcement, it has also resulted in an outsourcing of production and jobs as well as downward pressure on workers’ real wages in developed countries such as the United States.1 The key trade agreements and international institutions put in place to manage globalization, such as the North American Free Trade Agreement (NAFTA) and China’s entry into the World Trade Organization (WTO), have failed to rebalance the rules to enable globalization to work on behalf of all workers—not just in the United States, but in Mexico, China, and more broadly. And in many cases, the trade rules have exacerbated economic pressures on many U.S. workers.2 For years, progressive voices in the United States have called for efforts to make globalization work better for working families, communities, and the environment.3 Now, the Trump administration has sought claim to the trade reform mantle. Those claims, however, should be met with skepticism. The 2017 congressional Republican tax law slashed taxes for corporations and the wealthy on the false promise of raising wages for workers.4 Corporate profits, share buybacks, and mergers and acquisitions have all boomed, but working-class wages have barely budged.5 The international provisions of the 2017 tax law further incentivize offshoring operations at the expense of domestic investments and sourcing.6 The Trump administration’s domestic economic agenda of financial deregulation, budget cuts, and attacks on workplace safety and labor rights protections will simply make matters worse for working families. The administration’s record on trade policy has been mixed and largely incoherent. The president railed against NAFTA and other trade agreements for harming workers and U.S. jobs yet renegotiated a new NAFTA deal that fails to make labor and environmental standards meaningfully enforceable.7 His administration has slapped tariffs on adversaries and allies alike with little strategy—often in the name of national security and without addressing the root causes of the problem. Threatening further tariffs, the administration now is engaged in negotiations with China over intellectual property theft, market access for foreign multinationals, and a state-led industrial strategy.8 The president announced a delay in the additional tariffs, suggesting a deal with China is coming together, but concerns have long existed that the administration may settle for high-profile spot sales of U.S. commodities while effectively letting structural impediments and China’s industrial policies continue.9 The cost of what may be President Donald Trump’s high-profile deal with China could be real concessions for the United States, including in the technology and national security space, without providing lasting, solidly enforceable benefits more broadly.10 As U.S. Trade Representative Robert Lighthizer makes his first appearance this week before the new U.S. House of Representatives, the Trump administration will finally have to answer for its approach. Here are several questions that Congress should ask in order to hold the administration accountable to the American people.
Topic:
Security, International Cooperation, International Trade and Finance, and Science and Technology
Political Geography:
China, Asia, North America, and United States of America

88. Mexico’s Financial Risks: Solving Pemex for a Solvent Mexico

Author:
Laura Alfaro, Augusto de la Torre, Guillermo Calvo, Roque Fernandez, Pablo Guidotti, Paulo Leme, Enrique G. Mendoza, Guillermo Perry, Carmen M. Reinhart, and Liliana Rojas-Suarez
Publication Date:
07-2019
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
Mexico’s financial risks and the policies being adopted by the new administration cannot be ade- quately assessed without recognizing key features that characterize the following initial conditions:
Topic:
Development, International Trade and Finance, Governance, Finance, Economic Growth, and Risk
Political Geography:
North America and Mexico

89. The Sino-Russian and US-Russian relationships: Current developments and future trends

Author:
Marcin Kaczmarski, Mark Katz, and Teija Tiilikainen
Publication Date:
12-2018
Content Type:
Working Paper
Institution:
Finnish Institute of International Affairs (FIIA)
Abstract:
The great-power system has been in constant change since the end of the Cold War. The US became the hegemonic power, and under its shelter, the European Union was able to transform into a European-wide political body. Soon, a group of leading regional powers started to question the universalist aspirations of the Western-led international order. Two members of this club in particular were not satisfied with the role of a regional hegemon and had more global ambitions. China has already become the largest trading nation globally, and Chinese foreign policy has assumed an assertive tone. China has both the potential to challenge US hegemony, as well as the political will to use it. Russia’s project to achieve a global great-power status, on the other hand, is inspired by its historical identity and its alleged humiliation by the West after the collapse of the Soviet Union. Russia longs for recognition of its great-power status in particular from the US. This report focuses on relations between China and Russia on the one hand and the US and Russia on the other. It analyses the current developments and future trends in these relationships, as well as their implications for the EU.
Topic:
Foreign Policy, International Cooperation, International Trade and Finance, and Hegemony
Political Geography:
Russia, United States, China, Europe, Asia, and North America

90. The EU and China: Modest Signs of Convergence?

Author:
Gustaaf Geeraets
Publication Date:
12-2018
Content Type:
Working Paper
Institution:
EGMONT - The Royal Institute for International Relations
Abstract:
Against a background in which the United States is increasingly drawing into question its commitments to free trade and the global commons, the challenge for the EU and China is to deal with a global governance system that is evolving from a multilateral system centred around the US into a more diffuse system resting on the three strong trading poles: China, the EU and the US.
Topic:
International Trade and Finance, Governance, European Union, and Multilateralism
Political Geography:
United States, China, Europe, Asia, and North America