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1. WTO Industrial Subsidy Regulation: US-EU-Japan Joint Statement of January 2020 and Afterwards

Author:
Cheon-Kee Lee
Publication Date:
04-2020
Content Type:
Policy Brief
Institution:
Korea Institute for International Economic Policy (KIEP)
Abstract:
On 14 January 2020 the United States, the European Union, and Japan (hereinafter referred to as “US-EU-Japan”) issued a trilateral joint statement, proposing a set of new rules to strengthen WTO regulation on industrial subsidies. While a total of seven joint announcements have been made so far, this is the first time that three WTO Members have presented specific ideas on how to amend existing subsidy rules. Many of the proposed amendments seem to primarily target China’s trade policy and practices. Among the six amendment items proposed in the Joint Statement, it seems that the United States is paying particular attention to the sixth item, i.e. in making explicit the possibility of using the out-of-country benchmark and on introducing necessary requirements to do so in measuring the benefit conferred and, ultimately, in calculating the amount of the countervailing duties (CVDs). Against this backdrop, in this Brief the author analyzes the relevant WTO provisions and GATT/WTO jurisprudence, and discusses various scenarios on future negotiations on WTO Reform on industrial subsidies.
Topic:
World Trade Organization, Economy, Negotiation, Trade Policy, and Industry
Political Geography:
Japan, China, United States of America, and European Union

2. Japan’s Trade Policy in the Midst of Uncertainty

Author:
Yuka Fukunaga
Publication Date:
02-2020
Content Type:
Policy Brief
Institution:
Institut français des relations internationales (IFRI)
Abstract:
The multilateral trading system under the World Trade Organization (WTO) has been of the utmost importance for Japan's trade policy. In particular, Japan strongly supports the WTO’s rule-based dispute settlement mechanism, and frequently uses it. At the same time, in recent years, the adoption and implementation of regional and mega-regional trade agreements have become critical in Japan’s trade policy, with the stalling of the Doha Round negotiations in the WTO. Although the core of its trade policy remains the same today, Japan has been forced to rethink and modify it in response to the aggressive and unilateral trade policy of the Trump administration.
Topic:
World Trade Organization, Governance, Internet, Free Trade, and Trade Policy
Political Geography:
Japan, China, Asia, South Korea, North America, United States of America, and European Union

3. EU Trade Policy amid the China-US Clash: Caught in the Cross-Fire?

Author:
Ana González and Nicolas Véron
Publication Date:
08-2019
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
China's rapid rise and unique economic system and the increasingly aggressive and disruptive US trade policy are posing an unprecedented threat to the global rules-based trading and economic system. The European Union has critical interests at stake in the current escalation, even as it has so far been comparatively spared from US trade policy belligerence and China's reactions. In this context, the European Union should adopt an independent and proactive stance, building on recent efforts and going beyond them. The European Union, even more than the United States or China, has a strategic interest in the preservation of the global rules-based order embodied by the World Trade Organization (WTO). It must play a leading role in steering WTO reform and modernization, working closely with broadly aligned third countries such as Japan and other players. It should expand its outreach beyond its immediate negotiating counterparts in both the United States and China, and leading European officials at both the EU and member state levels should work at better understanding China. While strengthening its domestic policy instruments to address new challenges, such as the screening of foreign direct investment for security purposes, the European Union must also resist its own temptations of protectionism and economic nationalism. In support of these objectives, the European Union should prepare itself for difficult decisions, which may involve revising some of its current red lines in international trade negotiations. Conversely, the European Union should stand firm on principles such as refusing one-sided agreements and rejecting abusive recourse to national security arguments in trade policies. The European Parliament, in working with the European Council and the European Commission, will have a critical role to play in steering the European Union through these challenging times.
Topic:
Bilateral Relations, Economy, Trade Wars, and Trade Policy
Political Geography:
China, Asia, North America, United States of America, and European Union

4. EU Trade Policy amid the China-US Clash: Caught in the Cross-Fire?

Author:
Felipe González and Nicolas Véron
Publication Date:
08-2019
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
China's rapid rise and unique economic system and the increasingly aggressive and disruptive US trade policy are posing an unprecedented threat to the global rules-based trading and economic system. The European Union has critical interests at stake in the current escalation, even as it has so far been comparatively spared from US trade policy belligerence and China's reactions. In this context, the European Union should adopt an independent and proactive stance, building on recent efforts and going beyond them. The European Union, even more than the United States or China, has a strategic interest in the preservation of the global rules-based order embodied by the World Trade Organization (WTO). It must play a leading role in steering WTO reform and modernization, working closely with broadly aligned third countries such as Japan and other players. It should expand its outreach beyond its immediate negotiating counterparts in both the United States and China, and leading European officials at both the EU and member state levels should work at better understanding China. While strengthening its domestic policy instruments to address new challenges, such as the screening of foreign direct investment for security purposes, the European Union must also resist its own temptations of protectionism and economic nationalism. In support of these objectives, the European Union should prepare itself for difficult decisions, which may involve revising some of its current red lines in international trade negotiations. Conversely, the European Union should stand firm on principles such as refusing one-sided agreements and rejecting abusive recourse to national security arguments in trade policies. The European Parliament, in working with the European Council and the European Commission, will have a critical role to play in steering the European Union through these challenging times.
Topic:
International Relations, Economics, Trade Wars, and Trade Policy
Political Geography:
China, Europe, Asia, North America, United States of America, and European Union

5. Rebuilding a Bipartisan Consensus on Trade Policy

Author:
Phil Levy
Publication Date:
04-2019
Content Type:
Special Report
Institution:
Chicago Council on Global Affairs
Abstract:
Once upon a time, there was centrist, bipartisan support for US leadership in crafting an open global trading system. Over recent decades, though, as trade grew more complex, the share of US workers in manufacturing fell, and China emerged as an economic power, that consensus dissolved. By the 2016 election, both major party presidential candidates opposed the Trans-Pacific Partnership, a trade agreement central to US economic and foreign policy. Lest this opposition seem to represent a new consensus, it ushered in the recent period of political discord over trade. While some praised aggressive US actions to address trade deficits and national security concerns, others worried about the fraying of the global trading system and international markets lost to retaliatory barriers. This book provides the non-specialist reader with the background to understand the debates about trade. It begins by briefly tracing the history of US support for trade, as well as the shifts in the manufacturing sector that helped inspire calls to “make America great again.” It also considers the particular challenges posed by China’s emergence as a trading power while calling into question popular thinking on the resultant “China Shock” to US manufacturing. The book also offers an accessible guide to many of the esoteric topics that underlie today’s trade debates. It starts with tariffs, but proceeds to tackle issues such as trade deficits, intellectual property rights protection, rules of origin for goods, antidumping procedures, labor and environmental protections, and sovereignty. Finally, the book offers ways to move beyond the impasse that had emerged by 2016. Rather than focusing on a specific agreement such as the updated NAFTA (USMCA), it looks at whether deals should be bilateral or multilateral, and just how transparent negotiations need to be. It divides some particularly contentious issues into those that are easily addressed, those that might be feasible with work, and those that are nonstarters. While most of the work to restore a consensus would be difficult, the rewards would be great. The book concludes with a warning that the penalties for not restoring US leadership on trade could be severe.
Topic:
Foreign Policy, Economy, Trade Policy, and Political Parties
Political Geography:
China, Asia, North America, and United States of America

6. The Global Exchange (Winter 2018)

Author:
Adam Frost, David J. Bercuson, Stephen Blank, Monica Gattinger, Sarah Goldfeder, Colin Robertson, Hugh Stephens, Laura Dawson, Randolph Mank, Ferry de Kerckhove, Colin Robertson, Andrew Caddell, Robert Hage, David Perry, and Kelly Ogle
Publication Date:
12-2018
Content Type:
Journal Article
Journal:
The Global Exchange
Institution:
Canadian Global Affairs Institute (CGAI)
Abstract:
During the 1947 Duncan & John Gray Memorial Lecture then-minister of external affairs, Louis St. Laurent, outlined guiding principles for Canada’s engagement with the world. In his address, he recognized that Canada could not maintain the standard of living Canadians had come to enjoy in isolation from the rest of the world. He said, “[we] are dependent on markets abroad for the large quantities of staple products we produce and cannot consume, and we are dependent on supplies from abroad of commodities which are essential to our well-being.” This irrefutably remains true today. Canada’s ability to utilize its vast wealth of resources has afforded it the opportunity to become one of the most affluent and developed nations in the world, making the preservation of such ability of vital national interest. However, trade in the 21st century is more complex than ever before. Technology allows for transactions between parties scattered across the globe to occur near instantaneously, and complicates the tracking and classification of many goods and services. Moreover, global political developments and economic transformation are threatening the liberal world order built and protected by the United States since the Second World War. China’s emergence as an economic juggernaut is shifting the global economic centre of gravity. Furthermore, reactionary domestic political forces within much of the western liberal democratic world, including the United States, question the value of continued support for the status quo. Tectonic change is afoot. In response, Canada is charting its path to navigate the challenges of 21st century global trade. Prime Minister Justin Trudeau’s Liberal government is pursuing a progressive trade agenda as it seeks to modernize existing agreements, implement newly minted agreements, and explore potential future opportunities. The lead package of this issue examines a multiplex of challenges and opportunities presented to those currently crafting Canadian trade policy. Geographically, it spans not only the management of relations with the United States and NAFTA renegotiation, but also the geopolitical considerations of bolstered engagement with Asia and the underappreciated opportunities present in Africa and South America. In addition to "with whom", this package also addresses the "how and why" of trade: the difficulty of adapting trade practices to the digital age and the costs, benefits and limitations of projecting Canadian values via trade relations. In computer simulated and professional chess matches white consistently wins more often than not. The lack of first-mover advantage is a formidable deficit to overcome. Those who are not leading, are fated to play catch-up. The challenges facing Canada’s policy-makers responsible for protecting and advancing our national interest via trade are legion. To optimally address these challenges, Canada is best served by being proactive at the forefront of negotiations. The benefits of cultivating a proactive posture are enticing, and the costs for failing to do so are avoidable. Canada must adapt to the dynamism of the global economic order, or fight to catch-up.
Topic:
Diplomacy, International Trade and Finance, Science and Technology, Infrastructure, Internet, NAFTA, and Trade Policy
Political Geography:
Africa, Japan, Canada, India, Asia, North America, and United States of America

7. The Economic Importance of the KORUS FTA: A Case Study of the Korean Beef Market After Renegotiations

Author:
Jin Kyo Suh
Publication Date:
05-2018
Content Type:
Working Paper
Institution:
Korea Economic Institute of America (KEI)
Abstract:
Beef trade was a major sticking point between the United States and South Korea in ratifying the KORUS FTA. The outcome of the renegotiations that led to the March 2018 agreement in principle did not impact sections pertaining to beef in the agreement, though looking at how beef trade would have been affected should the talks have failed highlights the importance of the agreement to both countries, but particularly the United States. This paper estimates the demand for imported beef in South Korea by source and product by using the production version of the Rotterdam demand system and assesses what the potential impact of U.S. withdrawal from the KORUS FTA would have been on beef trade between the U.S. and South Korea. The results suggest U.S. withdrawal from the KORUS FTA would have resulted in a considerable increase in Australian beef exports to South Korea, largely at the expense of U.S. beef. This is because there is significant price competition between beef imports from the United States and Australia. Furthermore, Korean consumers substitute American beef for Australian beef when the relative price of U.S. beef rises.
Topic:
Economics, Treaties and Agreements, Exports, and Trade Policy
Political Geography:
Asia, South Korea, North America, Korea, and United States of America

8. Macron, Diplomat: A New French Foreign Policy?

Author:
Thomas Gomart and Marc Hecker
Publication Date:
04-2018
Content Type:
Special Report
Institution:
Institut français des relations internationales (IFRI)
Abstract:
How can we define Emmanuel Macron’s foreign policy since he took office? After Nicolas Sarkozy’s brazen style of “gutsy diplomacy” and François Hollande’s “normal diplomacy”, the eighth president of the Fifth Republic seems to have opted for an agile classicism. In substance, he makes no claim to any radical break with the past, but sees his approach as being in line with historical tradition. In relation to his predecessors, he has adjusted the balance between alliances, values, and interests in favor of the latter, while giving his policies an unambiguous European orientation. Formally, his approach is characterized by recourse to symbolism, strict control of communications, and an agile personal style. A term used within the business world to encourage organizations and individuals to adapt and innovate, “agility” also connotes a will to utilize and master new technologies. [...] Comprising 14 brief analyses, this collective study contributes to the initiative launched by Ifri in 2016 to analyze French foreign policy, and follows on directly from the earlier study published on the eve of the presidential election. It aims to give an update on the action Emmanuel Macron has taken on the principal international issues since his arrival in office. It should therefore be read not as an overall assessment, which would be impossible at this early stage of the presidential term, but more as an impressionist tableau giving a sense of an overall movement containing many different hues. Emmanuel Macron has four years left to perfect it.
Topic:
Foreign Policy, Defense Policy, Diplomacy, Trade Policy, and Emmanuel Macron
Political Geography:
Africa, Russia, Middle East, Asia, France, United States of America, and European Union

9. Political Signals: Why Are Some Countries Abandoning the Dollar in Their Foreign Trade?

Author:
FARAS
Publication Date:
10-2018
Content Type:
Commentary and Analysis
Institution:
Future for Advanced Research and Studies (FARAS)
Abstract:
Several Middle Eastern countries, such as Turkey and Iran, have been recently shifting into international currencies or local currencies, instead of the US dollar, in their foreign trade. This shift comes amid the US economic sanctions on Iran in tandem with its souring relations with Turkey. What is striking in this regard is that there is an international acceptance of other currencies, especially the Chinese yuan, with the pricing of some oil contracts in the same currency. This move seems to have a particular political significance, namely rejecting the impact of the US dollar on the trade of these countries rather than its economic feasibility, amid the sharp fluctuations in the local currencies of Iran, Turkey, and India in the past period.
Topic:
Economics, International Trade and Finance, Currency, and Trade Policy
Political Geography:
Russia, China, Iran, Eurasia, Middle East, North America, and United States of America