Excerpt from the Report: Sticking to the Job Key Trade Policy Considerations for the G20 Hamburg Summit and Beyond, Published by the International Centre for Trade and Sustainable Development (ICTSD)
July 6, 2017
Though “the direction and composition of world trade is quite different from what it was a generation ago” (Krugman and Obstfeld 2009), trade remains a key driving global force. According to the World Bank, in 2015 global merchandise exports of US$16.576 trillion accounted for around 22.3 percent of the world’s GDP. This figure is much higher than what it was a half-century ago. In 1960, the ratio was just 9.1 percent. If we take into account the rapid growth of commercial services trade in past decades, the difference of the ratio would be even more dramatic. From 1977 to 2007, trade in global merchandise increased from US$1.096 trillion to US$14.116 trillion, with an average annual growth rate of around 8.9 percent—higher than GDP growth over the same period. These figures stand as a testament to the contribution of trade to global growth in recent history. However, since the 2008 global financial crisis, the growth of global trade has been remarkably sluggish. For example, the volume of merchandise exports in 2015 amounted to US$16.576 trillion—almost the same as that seen in 2008 (US$16.267 trillion).
The debate over regional trade agreements is ongoing. It has been argued that they can heighten exposure to shocks as they lead to more specialisation, and conversely that they can alleviate volatility by improving policy coordination within the anchors of a formal trade contract. This column suggests that the benefits from lowering long-term growth volatility tend to dominate potential costs, with the magnitude of this effect depending on the depth of the regional integration and the development stage of trade partners.
There has been renewed interest in membership in regional trade agreements (RTAs) since the beginning of the new millennium, on a scale not seen since the proliferation of agreements in the 1970s. The number of countries belonging to at least one RTA soared from around 70 countries in the late 1970s to close to 200 countries by 2012. This was mainly driven by middle-income countries, while lower-income countries lagged behind the trend (Figure 1). The number of regional trade parners also increased significantly, reflecting partly membership in multiple, and often overlapping RTAs (Breinlich and Cuñat 2013, Hornok and Koren 2016).
Since 1998, A.T. Kearney’s Foreign Direct Investment Confidence Index has examined the overarching trends in FDI through a global survey of business executives that provides a three-year outlook on top destinations as well as related trends influencing investor decisions.
In the A.T. Kearney 2017 Foreign Direct Investment Confidence Index®, investors are bullish about economic growth and FDI prospects, but are monitoring political risk for abrupt changes to the business environment . Developed markets continue to dominate the rankings, but emerging markets are beginning to stage a comeback and there is greater diversity among the top 25 markets this year.
The United States tops the FDI Confidence Index for the fifth year in a row.
Germany rises to second place for the first time in the Index’s history.
The top five countries on the Index are the same as last year—although their rankings shifted a bit this year.
Europe again accounts for more Index spots than any other region, but its share of spots falls for the second consecutive year.
Developed markets continue to dominate the Index, but their position is weakening.
Investors are diversifying their FDI destinations again, indicating a greater risk appetite.
The all-too-visible hand of political risk is on full display in how investors determine where to invest.
Investors see FDI as a channel for growth amid weakening global trade flows and increasing protectionism.
Investors are using FDI as a localization strategy— foreign companies with a local presence in a market are already “in.”
Investors are much more bullish on the global economy this year.
Rising geopolitical tensions are the top wild-card risk for the third year in a row.
President Trump has been clear: his Administration will aggressively enforce U.S. trade laws and defend American workers from harmful trade barriers to promote free and fair trade that benefits all Americans. USTR is dedicated to identifying and addressing such barriers to American exports around the world to help level the playing field for American workers, job-creators, farmers, and ranchers.
The National Trade Estimate Report (NTE), an annual report on significant barriers to American exports, helps identify and address major roadblocks for American goods and services in markets around the globe.
Covering 58 countries, the European Union, Taiwan, and Hong Kong, the NTE highlights both the major developments impacting and impediments to U.S. exports. The findings raise awareness about trade restrictions and help facilitate efforts to remove barriers and open up overseas markets to U.S. goods and services.
The European Union (EU), a vital partner for the United States, is facing numerous challenges, including massive migration flows, the UK’s vote to leave the EU (Brexit), and rising support for anti-EU and populist parties in upcoming elections in several European countries. In Charting the Future Now: European Economic Growth and its Importance to American Prosperity, the Atlantic Council’s EuroGrowth Initiative proposes pragmatic steps to restore European economic growth, safeguard the European project, and reinvigorate the transatlantic alliance.
The Trump administration is reportedly considering a change in the way it calculates bilateral trade deficits. The stated goal is to end an alleged distortion that understates the US trade deficit, and thereby help the administration make better trade deals, defined as ones that reduce the deficit. You could call this proposal an “alternative calculation.” In fact it is just as bogus as the notorious “alternative facts” emanating occasionally from the White House.
The rationale for the proposed change was laid out in a recent letter to the Wall Street Journal, from Peter Navarro, head of the new National Trade Council, who claimed that the Census Bureau’s trade data “overstate exports by counting foreign-made products as US exports.” He argues that goods imported and then re-exported with no value added should not be calculated as exports at all.
Separating these so-called re-exports from total exports would seem rational. But using such data for trade balance calculations is problematic. In principle, it could make sense to exclude from the export side those goods that are imported and shipped overseas without any significant value added in the United States. But for a trade balance calculation, whether bilateral or aggregate, you must compare apples to apples. The new calculation would subtract re-exports from the export data, but not from the import data, which are not constructed to allow such a modification. The result is a superficially but misleadingly enlarged trade deficit on aggregate and for many important trade partners.
Mr. Scott appeared at WITA’s February 16 event on U.S.-China Trade and Investment Relations. Video of the event can be found here.
The United States has a massive trade deficit with China. It has grown since the end of the Great Recession. The growth of that deficit almost entirely explains the failure of manufacturing employment to fully recover along with the rest of the economy. And as other studies have suggested, the trade deficit has cost us millions of jobs since China entered the World Trade Organization (WTO) in 2001.
The growth of the trade deficit means that the United States is both losing jobs in manufacturing (in electronics and high tech, apparel, textiles, and a range of heavier durable goods industries) and missing opportunities to add jobs in manufacturing (in exporting industries such as transport equipment, agricultural products, computer and electronic parts, chemicals, machinery, and food and beverages) because imports from China have soared, and exports have increased much less. The trade deficit with China affects different regions in different ways. Some regions are devastated by layoffs and factory closings while others are surviving but not growing the way they could be if new factories were opening and existing plants were hiring more workers. This slowdown in manufacturing job generation is also contributing to stagnating wages and incomes of typical workers and widening inequality.
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What’s the most “positive” word uttered by politicians on trade? Exports.
What’s the most “negative” word uttered by politicians on trade? Deficit.
More specifically, when many politicians talk about trade, they often promote exports as an inherently good thing, and decry the U.S. trade deficit as evidence that other countries are taking advantage of us.
But that characterization leads the general public to suspect that imports are a problem, and somehow Americans would be better off if we were to import fewer goods and services from abroad. Before we rush to a conclusion, let’s take a look at what we import.
We import products we need to make other products
Half of the goods we import are orders from U.S. companies (that is, manufacturers) as the inputs they need to operate their own production processes in the form of intermediate components or raw materials.
The U.S. Department of Commerce provides a useful way to look at imports by classifying them by their end use.
In 2015, 48 percent of U.S. imports consisted of “capital goods” (machinery and machine tools, semiconductors, parts, equipment, etc.) and “industrial supplies” (chemicals, fuels, lumber, plastics, metals, etc.). More than half of imports fall into these two categories if we include imported auto parts and engines (i.e., not finished vehicles) to the capital goods total.
Firm decisions
In each transaction, firms must determine the most appropriate inputs, ingredients, and other supplies to make their products, taking into account form, quality, price and a dozen other criteria their suppliers must meet. There may be a variety of reasons they choose to import those supplies. The material or equipment they need might not be readily available from a domestic source, or perhaps it’s not available in sufficient quantity, or isn’t made exactly to the right specification.
Because the firm (which employs U.S. workers in U.S. factories) has access to their choice of inputs, its finished products are a better value for consumers and that usually translates to greater sales and more secure jobs for the firm’s employees.
Imports support jobs
That’s something you don’t hear politicians say. Increased demand for industrial inputs – whether imported or not – is a sign of economic strength, even if it leads to an increase in the “trade deficit.”
Because small and large producers alike can make appropriate choices about their inputs – and use imported inputs as needed – they are more competitive in world markets. Conversely, if imported goods became artificially more expensive because of a tariff, firms risk being made less competitive; they would sell fewer finished products, and ultimately employ fewer workers.
Imports support our lifestyle
There is a lot to like about the other half of what we import, too. Imported consumer goods, from electronics to clothing to jewelry, give us greater buying power and a broader array from which to choose. And don’t forget imported food, which means fresh avocados for your big-game guacamole as well as delicacies from around the world at your local store.
Sure, it’s good when American companies export goods and services to the world. But imports make many American-made products more competitive as well as enriching our lives as consumers – they are part of the secret sauce of what makes our economy work so well.
Additional Reading: Chapter 1 of Dartmouth economist Doug Irwin’s book, Free Trade Under Fire
Scott Miller is a senior adviser and holds the William M. Scholl Chair in International Business at CSIS.
“FDI recovery continues along a bumpy road. Particularly of concern is the sharp drop-off in manufacturing investment projects, which play such an important role in generating badly needed productivity improvements in developing economies,” UNCTAD Secretary-General Mukhisa Kituyi said.
“Looking ahead, economic fundamentals point to a potential increase in FDI flows by around 10% in 2017,” Dr. Kituyi said. “However, significant uncertainties about the shape of future economic policy developments could hamper FDI in the short-term.”
The decline of FDI in 2016 was not equally shared across regions, reflecting the heterogeneous impact of the current economic environment on countries worldwide.
FDI flows to Europe fell 29% to an estimated $385 billion, with a number of countries experiencing strong volatility in their inflows. This decline was tempered by modest growth in flows to North America (6%) and a sizeable increase in investment in other developed economies, principally Australia and Japan.
Slowing economic growth and falling commodities prices weighed on FDI flows to developing economies. Inflows to these economies fell 20% (to an estimated $600 billion) due to significant decreases in developing Asia and in Latin America. Nevertheless, developing economies continue to comprise half of the top 10 host economies. FDI flows to transition economies rose by 38% to an estimated $52 billion.
The wave of cross-border mergers and acquisitions shows signs of ebbing. A 13% increase in the value of net sales, which rose to $831 billion, pales when compared to the 67% and 68% increases registered in 2014 and 2015. Greenfield FDI project announcements value rose by 5%, but this was largely due to a handful of very large projects in a few countries. The vast majority of countries, in contrast, registered declines.
Regional contribution to global FDI flows, 2015–2016 (Billions of US dollars)
Estimated FDI inflows: top 10 host economies, 2016 (Billions of US dollars)
The International Centre for Trade and Sustainable Development (ICTSD) is pleased to publish the third issue in the CEIPI-ICTSD series on Global Perspectives and Challenges for the Intellectual Property Systemproduced jointly with the Centre for International Intellectual Property Studies (CEIPI). The new issue, edited by Professor Christophe Geiger, explores the relationship between intellectual property (IP) rights and the right to science and culture.
This topic has recently served as the basis for an increasing body of legal scholarship and reports from international organisations, including two well-noted reports in 2014 and 2015 issued by the United Nations Special Rapporteur in the field of cultural rights, which shed some light on the complex interactions between IP regimes and access to science and culture, but also generated further discussion.
The volume includes papers authored by prominent scholars from both the intellectual property and human rights fields, including an introduction by the former UN Special Rapporteur, Farida Shaheed, herself. The other contributions are by Christophe Geiger, Mylène Bidault, Lea Shaver, Carlos M. Correa, Rochelle Cooper Dreyfuss, Rebecca Giblin, Kimberlee Weatherall, and Peggy Ducoulombier.
The CEIPI-ICTSD publication series provides high quality academic and policy-oriented papers dealing with topics that are of global relevance because of their normative pre-eminence, economic relevance, and socio-economic impact.
MEXICO CITY (Reuters) – Canada and Mexico will rebuff the United States over its demand for tougher NAFTA automotive content rules, top officials said on Monday as negotiations to renew the treaty bogged down with only a few months to go.
U.S. President Donald Trump is threatening to quit NAFTA, which has reshaped the continent’s auto sector over the past 23 years, unless major changes can be made to return manufacturing jobs to the United States.
The U.S. manufacturing sector has weathered a bumpy road over the course of the past two decades – but successfully righting the country’s industrial ship would mean an economic windfall of $530 billion, according to a new report from The McKinsey Global Institute.
MEXICO CITY (Reuters) – Canada and Mexico will not make counterproposals to U.S. demands for tougher NAFTA automotive content rules but instead will offer rebuttals and pepper American negotiators with technical questions on Monday, people familiar with the talks said.
Canada will make a presentation arguing U.S. demands would cause serious damage to U.S. as well as North American automotive manufacturing, a Canadian source with knowledge of the negotiations said.
The latest Nafta talks have proven far less dramatic than the fireworks of earlier rounds, though any deal remains far off as Mexico and Canada hold out hope the U.S. will soften its demands. The fifth round of talks, which began in Mexico City on Nov. 15 and wraps up on Tuesday, is the first held without the top trade chiefs from the three countries.
MEXICO CITY (Reuters) – Mexico shot down a proposal by the United States to include provisions in the North America Free Trade Agreement that would benefit AT&T Inc (T.N), Mexico’s Economy Minister Ildefonso Guajardo said on Wednesday.
“AT&T, which is North American, asked its government to reflect its interests in the negotiation,” Guajardo said in an interview on local radio without specifying the details of the U.S. proposal. “You cannot have an agreement… that gives a tailor’s cut, a perfect handiwork, to a specific company.”
Trump’s Trade Policy Is Lifting Exports. Of Canadian Lobster.
CENTREVILLE, Nova Scotia — This lobster factory on a windswept bay in eastern Canada is so remote that its workers have to drive for miles just to get cellphone service. But Gidney Fisheries is truly global, with its lobsters landing on plates in Paris and Shanghai through trade agreements hammered out in far-off capitals.
Of late, these trade pacts have been shifting in the factory’s favor, giving it an advantage over its American competitors.
A new trade agreement between Canada and the European Union has slashed tariffs on imports of Canadian lobsters. That means more 747s filled with Christmas-red crustaceans will depart from Nova Scotia for European markets this winter — and more revenue will flow to Gidney fisheries
MEXICO CITY (Reuters) – Mexico will respond to U.S. demands for changes in content rules for autos and an automatic expiration clause in the NAFTA trade deal when negotiations on reworking the accord begin again this week, a top government official said on Tuesday.
A fifth round of talks to overhaul the North American Free Trade Agreement starts on Wednesday in Mexico City, notable for U.S. demands that the U.S. Chamber of Commerce has labeled “poison pills.”
American lawmakers have escalated their campaign against the Trump administration’s handling of the NAFTA negotiations, slamming White House policies in a series of letters this week.
Separate letters have criticized the administration’s push for a so-called sunset clause in the agreement; its proposal on auto-parts rules of origin; and its idea of using international agreements as the vehicle for lowering the U.S. trade deficit.
US Trade Representative Robert Lighthizer has announced a new effort to ensure beneficiary countries are meeting the eligibility criteria of the Generalized System of Preferences (GSP) trade preference program.
This new effort includes a heightened focus on concluding outstanding GSP cases and a new interagency process to assess beneficiary country eligibility. This interagency process complements the current petition receipt and public input process for country practice reviews, which will remain unchanged
As trade negotiators prepare to meet in Mexico this week, Wall Street is increasingly worried the 23-year-old NAFTA trade deal could fall apart, creating the potential for new trade clashes in North America and around the globe.
Analysts say tough “America first” trade talk from President Donald Trump in Vietnam last week raised new concerns about his opposition to deals like the North American Free Trade Agreement with Mexico and Canada. Trump has pushed for the renegotiation of NAFTA, and he has also threatened to withdraw from it, something analysts say appears to be increasingly possible.
On January 23, three days into his administration, President Donald Trump withdrew from the Trans-Pacific Partnership (TPP), a trade agreement with eleven other countries. Many thought that was the end of TPP.
But last Saturday, at the APEC Summit that Trump also attended, the 11 remaining countries agreed on a blueprint for finalizing the deal— without the United States.
Lurking around the Nafta negotiations that resume Wednesday is a small yet unnerving possibility: The $1 trillion trade pact unravels completely, taking the Mexican peso and Canadian dollar down with it.
“There’s about a 10 percent chance that one side completely walks away,” said Shawn Snyder, head of investment strategy at Citi Personal Wealth Management in New York. “That would be a significant event.”
As Mexico prepares to host the fifth round of negotiations over the 23-year-old North American Free Trade Agreement (NAFTA), most Americans (56%) say that the pact is good for the United States, while just a third (33%) say it is bad.
DANANG, Vietnam — President Trump pitched a go-it-alone, “America First” trade policy to a gathering of nations on Friday that once pinned their economic hopes on a regional pact led by the United States, vowing to protect American interests against foreign exploitation.
BEIJING – US and Chinese companies on Wednesday signed business deals the two sides valued at $9 billion during a visit by President Donald Trump in a tradition aimed at blunting criticism of Beijing’s trade practices.
President Donald Trump’s visit to South Korea this week highlights a historic time for the two countries. It comes just weeks after a heated war of words between Trump and North Korea’s Kim Jong Un at the recent United Nations meeting. Equally important, it comes as the U.S. and South Korea undergo a top to bottom reevaluation of conventional wisdom that has long guided the internal policies of each country and our economic ties with each other. Few bilateral economic and security relationships have such far reaching consequences.
Korea is America’s sixth largest two-way trading partner, with a whopping $112.2 billion in 2016. It would be sufficient to examine the relationship just from the perspective of connected technology trade; for example, Apple and the Korean Samsung together account for two-thirds of smartphones in U.S., and Korean Kakao is a leading social network/gaming/taxi platform with more than 100 million users. But the trade between our countries extends well beyond mobile phones and apps, to vehicles, connected appliances, machinery, pharmaceuticals and fuels.
The U.S. has proposed another difficult change to the North American Free Trade Agreement that could eventually restrict long-haul Mexican truckers from operating in the country, according to people familiar with the discussions.
American negotiators asked to remove Mexico’s long-haul industry from a Nafta chapter on cross-border services, according to an industry official familiar with the proposal who isn’t authorized to speak publicly. That could open the door to restrictions on truckers, as losing Nafta trade protections and advantages would make it harder for Mexico to challenge any future U.S. requirements on trucks such as new safety checks.
Donald Trump pledged on Thursday to change a US-China trade and economic relationship that is “far out of kilter” as he began a day of meetings in Beijing with his Chinese counterpart, Xi Jinping.
“The US really has to change its policies because they’ve gotten so far behind China,” the US president told Mr Xi ahead of a meeting of their two delegations in the Great Hall of the People. “It’s too bad past administrations allowed it to get so far out of kilter,” Mr Trump added.
What if President Trump’s ultimate goal is to kill the World Trade Organization?
When Robert Lighthizer, Mr. Trump’s top trade negotiator, cut his teeth on trade diplomacy, back during the presidency of Ronald Reagan, the United States had an idiosyncratic way of solving its grievances over trade: asking its trading partners to curb their exports, or else.
The role of “sunny optimist” may seem a strange fit for a Trump administration trade official, but U.S. Trade Representative Robert Lighthizer tried it on recently. In a discussion about renegotiating the North American Free Trade Agreement (NAFTA), he mused about returning “to the days where there was a substantial majority of people in both parties that voted for these trade agreements. … That is my objective right now. I want to have a huge number of Republicans and a huge number of Democrats.”
The current state of talks to update the NAFTA trade pact is creating uncertainty among businesses and could hurt investments and growth, Rio Tinto Aluminium (RIO.L) chief executive Alf Barrios said on Wednesday.
Canada and Mexico say several U.S. proposals for modernizing the North American Free Trade Agreement are unacceptable, prompting increasing concern that Washington could walk away from the trilateral deal.
Responding to remarks by U.S. President Donald Trump, a Chinese spokeswoman on Thursday said the country never intentionally sought a trade surplus with the United States and that some frictions are inevitable.
Trump on Wednesday said the U.S. trade deficit with China was “through the roof,” calling it “so big and bad that it’s embarrassing saying what the number is.”
President Donald Trump embarks Friday on a five-nation tour through Asia — his longest foreign trip yet — where he’ll confront some of the most significant tests of his national security and economic agendas.
Trump arrives in Asia amid deepening concerns over North Korea’s nuclear and ballistic missile programs. Key allies in Tokyo and Seoul will be looking for reassurance in the face of dangerous provocations from Kim Jong Un and bellicose statements from the U.S. president himself. Trump hopes to court China into exerting more pressure on Kim’s regime
Federal trade officials on Tuesday will recommend measures to safeguard struggling domestic solar panel manufacturers against cheap imports in a closely watched case that could have a major impact on the price of U.S. solar power.
The vote by the U.S. International Trade Commission is a major milestone in a case that has divided the solar industry for the last six months. The panel’s proposals, which could include tariffs, a quota or other trade remedies, will be delivered to President Donald Trump, who will make a final decision later this year.
China’s ambassador on Monday brushed off the Trump administration’s complaints that Beijing is employing predatory trade and economic practices to bully and intimidate neighbors, suggesting that the United States “look in the mirror because they might be describing themselves.”
Ambassador Cui Tiankai’s comments during a briefing with reporters came as President Trump prepares to leave Washington at week’s end for a 12-day swing through five Asian nations, including China, during which the main topics are expected to be confronting North Korea and discussions on U.S. trade relations in the region.
While US President Trump tries to cut off the United States from globalization and Britain turns away from the EU, global trade carries on and is movely more nicely than expected. The IMF and WTO are set to increase their growth forecasts.
Secession was the talk of Mexico’s biggest business summit this week.
Not the latest news from Catalonia, but the idea that Mexico lost its independence and ought to do something about it. An entire national model has been based on catering to the North American Free Trade Agreement, the 23-year-old accord that links commerce between Mexico, the U.S. and Canada. There’s regret that not much thought was given to what could go wrong.
Trump-Heavy States at Biggest Risk of Trade, NAFTA Disruption
President Donald Trump to this point has made good on his campaign promises of scrapping trade deals he feels are unfair to U.S. workers – despite warnings from some analysts over the potential repercussions from the collapse of decades-old trade arrangements.
Trump withdrew the U.S. from Trans-Pacific Partnership negotiations shortly after taking office – a move Democratic rival Hillary Clinton also promised on the campaign trail to consider.
Automakers, retailers and other business leaders stormed Capitol Hill on Tuesday in an extraordinary show of force against a Republican president they fear will cripple or kill the North American Free Trade Agreement, an outcome business leaders said could devastate their profits and harm the United States’ ability to compete in a global market.
More than 130 representatives from an array of industries met with senators on Tuesday to ratchet up pressure on lawmakers — many of whose constituents work for companies dependent on Nafta — to keep the deal intact.
Secession was the talk of Mexico’s biggest business summit this week.
Not the latest news from Catalonia, but the idea that Mexico lost its independence and ought to do something about it. An entire national model has been based on catering to the North American Free Trade Agreement, the 23-year-old accord that links commerce between Mexico, the U.S. and Canada. There’s regret that not much thought was given to what could go wrong.
It’s no secret that President Donald Trump isn’t a fan of NAFTA. Throughout his campaign, he promised to rip up trade deals, specifically zeroing in on the North American Free Trade Agreement, the US’s trade deficit with Mexico, and the US’s loss of manufacturing jobs.
The evidence available, however, favors the position that changing NAFTA would neither reduce the US’s trade deficit nor meaningfully increase its manufacturing jobs, according to two charts shared by Bank of America Merrill Lynch’s Carlos Capistran and Ethan S. Harris in a recent report to clients.
President Donald Trump to this point has made good on his campaign promises of scrapping trade deals he feels are unfair to U.S. workers – despite warnings from some analysts over the potential repercussions from the collapse of decades-old trade arrangements.
Trump withdrew the U.S. from Trans-Pacific Partnership negotiations shortly after taking office – a move Democratic rival Hillary Clinton also promised on the campaign trail to consider.
It wasn’t supposed to be like this, but the folks who help U.S. companies set up production in Mexico say they’re having a solid year.
Tecma Group has more business than ever in its three decades doing relocation. In just the last few weeks, it aided a maker of cleaning equipment and a packaging company make the move south. Chicago-based Mexico Consulting Associates has three new prospects interested in Mexico.
Major automakers, suppliers and auto dealers are launching a new coalition on Tuesday to urge U.S. President Donald Trump not to withdraw from the North American Free Trade Agreement.
Auto trade associations representing General Motors Co (GM.N) Toyota Motor Corp (7203.T), Volkswagen AG (VOWG_p.DE), Hyundai Motor Co (005380.KS), Ford Motor Co (F.N) and nearly every other major automaker, are part of the coalition dubbed “Driving American Jobs” and backing an advertising campaign to convince the White House and voters that the agreement has been crucial in boosting U.S. automotive sector production and jobs.
When George Allen was an NFL head coach in the 1970s, his philosophy was: “Winning isn’t everything; it’s the only thing.”
President Trump shares that philosophy. He sees trade surpluses as evidence of winning and deficits as evidence of losing. So, his administration is renegotiating NAFTA to reduce or erase the U.S. trade deficit with Mexico (we have a surplus with Canada). And it demanded a renegotiation of the Korea-US Free Trade Agreement reduce or erase the U.S. trade deficit with South Korea. The Koreans grudgingly acquiesced.
WASHINGTON (Reuters) – The number of Americans filing for unemployment benefits fell more than expected last week, but the continued impact of Hurricanes Harvey and Irma on the data made it difficult to get a clear picture of the labor market.
As Donald Trump prepares for his first trip to Asia as president early next month, including a meeting in Beijing with Chinese President Xi Jinping, it’s worth looking at the wall that he has been able to build, this one around the United States.
Donald Trump is a politician who rose to prominence based on his knack for crafting catchy and deep-cutting sound-bites. As president, however, his ability to comprehend complex public policy issues doesn’t appear to extend much beyond the range of a 140 character limit.
MEXICO CITY/WASHINGTON (Reuters) – The most powerful U.S. business lobby accused the Trump administration on Tuesday of making “poison pill proposals” to sabotage talks aimed at modernizing NAFTA, as negotiators began gathering in Washington for fresh trade talks.
When George Allen was an NFL head coach in the 1970s, his philosophy was: “Winning isn’t everything; it’s the only thing.”
President Trump shares that philosophy. He sees trade surpluses as evidence of winning and deficits as evidence of losing. So, his administration is renegotiating NAFTA to reduce or erase the U.S. trade deficit with Mexico (we have a surplus with Canada). And it demanded a renegotiation of the Korea-US Free Trade Agreement reduce or erase the U.S. trade deficit with South Korea. The Koreans grudgingly acquiesced.
WASHINGTON (Reuters) – The number of Americans filing for unemployment benefits fell more than expected last week, but the continued impact of Hurricanes Harvey and Irma on the data made it difficult to get a clear picture of the labor market.
The U.S. President Donald Trump’s threats to terminate the U.S. trade agreement with South Korea ended up spurring support for the deal — and now both parties are striking a conciliatory tone.
The U.S. International Trade Commission (ITC) voted 4-0 in Whirlpool’s (WHR) favor on Thursday, ruling that a “surge” of washing machines from Samsung (SSNLF) and LG (LPL) have “seriously injured” domestic manufacturers.
WASHINGTON — Rising exports and falling imports shrank the United States’ trade deficit in goods and services to the lowest level in nearly a year, data released Thursday by the Commerce Department showed.
You know those awkward dinner parties when the two people you didn’t invite are all anyone can talk about?
Well, imagine for a moment the conversation between Thailand’s Prime Minister, Prayuth Chan-ocha, and the US President Donald Trump.
It is likely to be dominated by two countries that have preoccupied President Trump’s brain space (and his social media feed) of late: North Korea and China. But there are other things on the agenda – trade and defence ties for instance are likely to be discussed as well.
The top U.S. negotiator at talks to modernize the NAFTA trade pact on Monday dismissed questions about why his team had so far failed to produce specific proposals on key issues, saying “I don’t see a problem.”
Officials from the United States, Mexico and Canada are in Ottawa for the third of seven planned rounds of talks. The U.S. delegation has yet to unveil its precise position on several points, prompting concerns the process to update the 1994 pact could drag on beyond the scheduled end-December finish.
When Peru’s President Pedro Pablo Kuczynski welcomed his Bolivian counterpart Evo Morales for a bilateral summit in Lima earlier this month, a long-mooted interoceanic train was on the agenda once again.
The idea is for the railway to run more than 2,000 miles from Brazil’s Atlantic coast, potentially cutting through the Amazon and over the Andes, to one of Peru’s Pacific ports. The megaproject would be a massive feat of engineering, comparable in scope and geostrategic purpose to the Panama Canal.
Boeing is no stranger to disputes with foreign competitors, but a rising tide of protectionism has turned its most recent trade disagreement into an international throw down.
On Tuesday, the Commerce Department is expected to announce a decision on Boeing’s allegation that Bombardier, a Canadian jet maker, was able to sell new aircraft in the United States at unfairly low prices because of subsidies it received from the Canadian government.
On Friday, the U.S. International Trade Commission, a federal body, ruled that U.S. solar manufacturers are being injured by solar product imports. This gives the Trump administration an opportunity to increase duties on imported solar equipment, which would raise the costs of solar energy for companies and households in the United States.
Commerce Secretary Wilbur Ross told CNBC on Friday that autos and auto parts are a key area in overhauling the 1994 North American Free Trade Agreement.
The “scariest part” of NAFTA as it’s currently written is that autos and auto parts make up nearly all of the U.S. trade deficit with Mexico and Canada, Ross said on “Squawk Box.
China’s long-term credit rating on Thursday received its second downgrade from a major credit agency this year – and its first from Standard & Poor’s Global Ratings in nearly 20 years – as analysts warned of elevated “economic and financial risks” in the world’s second-largest economy.
S&P in a statement Thursday indicated China’s considerable credit growth in recent years had “contributed to strong real GDP growth and higher asset prices” but that “it has also diminished financial stability to some extent.”
As negotiators from Canada, Mexico and the United States head to Ottawa this weekend for a third round of North American Free Trade Agreement talks, the Trump administration is releasing data it says proves the playing field is tilted against American manufacturers.
A Commerce Department report released on Friday contains data showing the United States is playing a diminished role in manufacturing products that are bought and sold around the continent. Meanwhile, countries outside of North America — like China — are capitalizing on Nafta’s weak rules and benefiting from the trade agreement, the report said.
China’s commerce ministry, taking aim at the United States, said on Thursday that some countries’ unilateralism is an unprecedented challenge to global trade.
The comment from Ministry of Commerce spokesman Gao Feng at a news conference was in response to a question about recent trade actions taken by the United States.
EIGHT months into Donald Trump’s presidency, the rules-based system of global trade remains intact. Threats to impose broad tariffs have come to nothing. Some ominous investigations into whether imports into America are a national-security threat are on hold. Mr Trump looks less a hard man than a boy crying wolf.
Global trade is rebounding strongly but risks remain, the World Trade Organization said on Thursday, with commerce expected to grow by 3.6 percent in 2017, well above last year’s 1.3 percent.
The forecast marks a sharp upward revision of the WTO’s April estimate, when it foresaw growth of 2.4 percent and in a range of 1.8-3.6 percent, due to a high level of political and economic uncertainty.
A vast majority of Canadians say the government should ditch NAFTA if current renegotiations end in a “bad deal for Canadians and the environment.”
In an EKOS poll carried out for the Council of Canadians, 77 per cent of respondents said Canada would be better off with no deal than a bad deal; 48 per cent strongly agreed.
The WTO dispute settlement system is “deficient” and has often ruled in favor of free trade that overlooks details of a trade agreement, U.S. trade envoy Robert Lighthizer said on Monday.
Speaking at the Center for Strategic and International Studies, Lighthizer, a trade lawyer, made clear that the administration was poised to push for major changes to the global trade system during upcoming meetings of the Geneva-based trade body. WTO member countries will meet in Buenos Aires on Dec 10.
A business group urged China on Tuesday to carry out promises to open its economy and warned that inaction might fuel a backlash against free trade amid mounting U.S. and European criticism.
The European Union Chamber of Commerce said in a report that Beijing is backtracking in some areas, including by imposing new restrictions on food imports, express delivery and legal services. It proposed hundreds of possible changes to open the state-dominated economy wider or simplify rules in fields from cosmetics to medical devices.
U.S. Trade Representative Robert Lighthizer said Monday that the Trump Administration is drawing up plans to punish China outside the World Trade Organization.
Speaking at the Center for Strategic and International Studies in Washington, Lighthizer said the government is looking for “other ways” to defend American companies and workers from the effects of China’s subsidized trade.
WASHINGTON — The top United States trade negotiator said Monday that it was unclear whether Canada, Mexico and the United States could reach a deal to overhaul the North American Free Trade Agreement within the ambitious timetable set by the Trump administration.
Speaking at POLITICO’s Pro Policy Summit, Ross said resolving the nuclear missile problem is the administration’s “No. 1 priority.”
“The primary responsibility of the president is to protect the American people, so that has to be the sine qua non,” Ross said. But, he added, there is “nothing logically inconsistent with that and having a trade policy that’s better economically for us.”
Now, U.S. and Canadian trade officials and labor advocates want to use the Nafta renegotiation to prod Mexico into raising its wages.
“Higher wages in Mexico are in the interests of Mexico and the U.S.,” economist Peter Navarro, a trade adviser to President Donald Trump, told The Wall Street Journal recently. “Without this adjustment Mexico will never have a robust middle class, and our middle class will wither if not die.”
U.S. President Donald Trump renewed his threat to scrap NAFTA and ripped on trading partners Canada and Mexico in a tweet early on Sunday, days before the three countries were scheduled to hold a second round of negotiations on rewriting the 23-year-old agreement.
“We are in the NAFTA (worst trade deal ever made) renegotiation process with Mexico & Canada. Both being very difficult, may have to terminate?” he wrote.
The U.S. goods trade deficit increased in July as exports fell, suggesting that trade would make a modest contribution to economic growth in the third quarter.
The Commerce Department said on Monday the goods trade gap increased 1.7 percent to $65.1 billion last month. Exports declined 1.3 percent, weighed down by an 8.0 percent tumble in shipments of motor vehicles.
The renegotiation of the North American Free Trade Agreement is off to a rocky start.
The Trump administration lectured Canada and Mexico on the failures of the current agreement at an opening news conference Wednesday morning, while behind closed doors negotiators began to seek significant concessions from America’s neighbors.
China announced a ban on imports of iron ore, iron, lead and coal from North Korea on Monday, increasing the economic pressure on the Pyongyang regime, as it moved to implement a package of sanctions put together by the U.N. Security Council.
The ban will take effect from Tuesday, the Ministry of Commerce announced, although China will continue to clear goods that have already arrived in port until Sept. 5.
Let’s add a fourth option to the three options most often heard when the subject is North Korea and the nuclear threat it poses to the United States: Trade with North Korea. Or, I should say, rapidly increase what is now our limited trade with North Korea.
The Trump administration will take steps Monday to launch an investigation into Chinese intellectual property violations that could result in severe trade penalties, a threat the United States could wield to pressure Beijing into improving its economic behavior and doing more to contain North Korea’s nuclear threat.
The president plans to sign an executive memorandum Monday afternoon directing his top trade negotiator to determine whether to investigate China for harming intellectual property, innovation and technology, senior administration officials said in a conference call Saturday morning.
The U.S. International Trade Commission (ITC) has made a preliminary decision that exports of Taiwanese and South Korea polyester fiber firms have caused damage to the polyester fiber industry in the U.S. because of their unfairly low prices. “There is a reasonable indication that a U.S. industry is materially injured by reason of imports of low melt polyester staple fiber from Korea and Taiwan that are allegedly sold in the United States at less than fair value,” the ITC said in a statement.
President Trump has promised a “big, big” free trade agreement with the U.K. once that country leaves the European Union in 2019. The British cabinet is, however, split over the prospect. Some ministers believe that Britain should clinch a deal with the U.S. at any cost. But others fear that a free trade deal would lift the existing European ban on the importation of some controversial American farm products and that could undermine British food standards.
The U.S. may not be the best country for Britain to start its post-Brexit trade agreements with, according to Adam Marshall, director general of the British Chambers of Commerce. “I wouldn’t want to go up against them, early on, when I’m just getting on my feet again as a country going into free trade agreements,” Marshall said in an interview on Bloomberg Television on Friday. “The U.S. trade representative is one of the best-oiled machines in the world when it comes to negotiating trade deals.”
The United States has decided to levy an import tax on shipments of aluminum foil from China, penalizing the country for what U.S. trade officials say are unfair subsidies of its products.It’s a decision that could add to mounting tensions between the world’s two biggest economies over trade, as the Trump administration considers a wide array of trade measures that would clamp on Chinese trade violations and the aluminum sector in particular.
Talks to renegotiate NAFTA — one of Trump’s chief campaign promises — begin in a week in Washington.Trump blames NAFTA for an exodus of manufacturing jobs to Mexico. He also credits his criticism of the free trade agreement as a key factor in his election.
This may seem like something you’ve heard before, but the administration is seeking to modernize an existing U.S. free trade agreement. This time, it’s the United States-Korea Free Trade Agreement, better known as KORUS.
The U.S. Today, U.S. Secretary of Commerce Wilbur Ross announced the affirmative preliminary determination in the countervailing duty (CVD) investigation of aluminum foil from the People’s Republic of China (China), preliminary finding that Chinese exporters of aluminum foil received countervailing subsidies 16.56 to 80.97 percent. The Commerce Department will instruct U.S. Customs and Border Protection to collect cash deposits from importers of aluminum foil from China based on these preliminary rates.
The U.S. International Trade Commission is investigating Qualcomm’s claims that Apple is violating several of its patents related to mobile technologies in several of its iPhone models. Qualcomm is seeking a ban on imports of the iPhone models that allegedly infringe on its IP.
Earlier this year, Apple sued Qualcomm for $1 billion, alleging that the company was collecting royalties on patents that it had “nothing to do with.” In April, Apple announced that it would no longer be paying Qualcomm any royalties as it pursued legal action against them.
China uses forced labour to export products to United States, says report. The report titled ‘US Exposure to Forced Labour Exports from China: Developments since the US Trade Facilitation and Trade Enforcement Act of 2015’ states that the value of the Chinese forced labour exports to the US is unknown as China’s forced labour industry has long been opaque.
China’s top aluminum foil producers are preparing a legal defense challenging a preliminary U.S. ruling on Wednesday that would impose hefty penalties on imports from the world’s top producers, two sources familiar with the matter said. Loften Aluminum, China’s top foil exporter to the United States, is joining 11 other firms to fight the ruling, the first such case since the inauguration of U.S. President Donald Trump, an official at the company said on condition of anonymity.
There was a fascinating piece in Politico yesterday on the country’s agricultural sector, which has struggled for a while, but which saw an exciting new opportunity take shape last year. The Trans-Pacific Partnership (or TPP) was seen as “a lifeline,” offering Rural America a chance to reach millions of new, international customers. Donald Trump, a fierce opponent of the trade pact for reasons he’s never been able to explain in any detail, was quick to close that window. Now America’s rural exporters are watching other countries reach deals on their own, leaving the United States on the sidelines.
China on Tuesday reported July exports were up 7.2 percent in dollar terms, while imports were up 11.0 percent in dollar terms. Both were lower than expected. Analysts polled by Reuters expected a 10.9 percent rise in Chinese exports in July from a year ago in dollar terms. July imports were forecast to increase 16.6 percent in dollar terms.
The contribution of SMEs to economic growth, employment and development in the region plays an important part in achieving equitable economic development and regional economic integration.
April 27, 2018: “Challenges Facing International Business, Trade and Investments
May 3, 2018: “China 2025 and Beyond”
May 14, 2018: “Book Launch: The Wealth of a Nation”
November 12-15, 2018: “ITAR / EAR / OFAC Compliance Training Seminar”
Past Events
4/18/2018 Trade Counsels and the Role of Congress in Formulating U.S. Trade Policy
On Wednesday, April 18th, WITA welcomed an expert panel to discuss the role of Congress in regulating commerce with foreign nations.
4/13/2018 Can the WTO be Saved From Itself?
On Friday, April 13th, WITA hosted an expert discussion of U.S. concerns with the dispute settlement process at the WTO, and what can be done to update the system to address those concerns.
3/15/2018 Brexit: Status and Outlook at One Year
On Tuesday, March 15th, WITA welcomed an expert panel to discuss the political and social issues at the heart of the Brexit negotiations as well as the business interests in an amicable divorce.
3/13/2018 The Great Wall: Trade Enforcement in the Age of Trump
On Tuesday, March 13th, WITA welcomed an expert panel to discuss the recently announced tariffs on aluminum and steel and what these measures may mean for U.S. workers, firms, and consumers.
2/23/18 Governors & Premiers on NAFTA: A View from States and Provinces
On Friday, February 23rd, WITA is honored to welcome the Governor of Colorado, the Premiers of Quebec and Ontario, and the Governor of Querétaro, Mexico to discuss what the renegotiation of the North American Free Trade Agreement means to U.S and Mexican states and Canadian provinces.
2/15/2018 Implications of Tax Reform on International Trade and Investment
On Thursday, February 15th, WITA hosted a panel discussion by tax and economic experts on the implications of the 2018 tax reform on the future of the international trade and investment in the US.
2/5/18 Conversation with Ambassador Joe Hockey on Trade in the Asia-Pacific Region and WITA’s Annual Members’ Meeting & Reception
On Monday, February 5th, Australia’s Ambassador to the United States the Hon. Joe Hockey and the Financial Times’ World Trade Editor, Shawn Donnan discussed the future of trade in the Asia-Pacific.
1/24/18 What’s Happening to Trade Around the World?
On Wednesday, January 24th, WITA welcomed Ambassadors from Singapore, Mozambique, the European Delegation to the United States, Chile, and the Republic of Ghana, for a discussion on what is happening around the world of trade outside the United States.
12/12/17 Discussion of Agriculture, Trade and American Leadership with Amb. Max Baucus, Chairman Pat Roberts, and Grant Aldonas
On Tuesday, December 12th, WITA welcomed Amb. Max Baucus, Chairman Pat Roberts and Grant Aldonas on a discussion of agriculture, trade, and american leadership.
12/7/17 WITA NAFTA Series: Energy and the NAFTA
On Thursday, December 7th, WITA analyzed NAFTA’s energy chapter and what energy means for American, Canadian, and Mexican industries.
11/15/17 WITA NAFTA Series: The Art and Impact of Withdrawal from the NAFTA
On Wednesday, November 15th, WITA examined what may happen if the President announces that he plans to withdraw America from its most significant free trade agreement.
11/09/17 WITA NAFTA Series: Manufacturing in North America
On Thursday, November 9th WITA examined what NAFTA means for U.S. and North American manufacturing, and what the future will hold in a modernized NAFTA.
10/26/17 WITA “GATT@70” Trade Community Reception
On October 26, 2017, WITA held a reception to celebrate the 70th anniversary of the signing of the GATT. The event payed homage to the belief of the 23 nations that signed the original GATT in October 1947
10/19/17 WITA NAFTA Series: North American Supply Chains
On Thursday, October 19th, WITA welcomed President and CEO of Union Pacific, Lance Fritz to the Ronald Reagan Center for a discussion on North American Supply Chains.
On October 5th, 2017, WITA continued its NAFTA series with an event focused on Trade Dispute Settlement (Chapters 19 & 20). The event featured: Elaine Feldman, Pierre Elliott Trudeau Foundation, former Assistant Deputy Minister for North America, and Deputy Permanent Representative of Canada to the World Trade Organization. David Yocis, Picard, Kentz & Rowe, represents the US Lumber
10/4/17 The Agriculture Trade Agenda: A discussion with the United States Secretary of Agriculture, Sonny Perdue
On Wednesday, October 4, 2017 WITA hosted the U.S. Secretary of Agriculture, Sonny Perdue, to discuss America’s agricultural trade agenda.
9/13/17 WITA NAFTA Series: What’s in Store for Food & Agriculture?
On Wednesday, August 13th, WITA held its second NAFTA Series Event on the future of North American Food and Agriculture. The Event focused on what’s in store for food and agriculture with the ongoing negotiations of NAFTA .
7/20/2017 WITA NAFTA Series- Kickoff Event
On Thursday, July 20th, WITA launched it’s signature NAFTA Series to examine some of the more vexing issues that will face the three governments as they work to update the 25 year-old trade agreement. Panelists discussed critical issues for the negotiations including dispute settlement procedures, the interests of organized labor, and what the American business and agriculture communities hope to see in an updated agreement.
2017 Annual Dinner Recap
On Wednesday, July 12, 2017 the Washington International Trade Association (WITA) and Washington International Trade Foundation (WITF) hosted their 23nd Annual Awards Dinner (#TradeProm) at the Ronald Reagan Building and International Trade Center. Honorees included Senator Jeff Flake (R-AZ), Congressman Rick Larsen (D-WA), and Meredith Broadbent, former Chairwoman of the United States International Trade Commission (USITC).
WITA’s NextGenTrade™: The Future of US-Brazil Trade Relations
On Thursday, June 22nd, WITA held a NextGenTrade™ Event on the Future of US-Brazil Trade Relations. The Event focused on the future of US-Brazil trade relations and examined the US-Brazil trade relationship and opportunities for the future.
WITA’s NextGenTrade™: Is Blockchain the Future for Trade?
On June 15th, 2017 the Washington International Trade Association held an event: Is Blockchain the Future for Trade?. At this event WITA’s speakers explored the future of trade through the lens of the business and work in the 21st Century.
Intensive Trade Seminar: Spring Session
On Wednesday, May 3rd, WITA held the second event in its NextGenTrade™ signature series on the Future of Trade and Global Value Chains. Discussants examined how trade policy should be adapted to anticipate the future of global value chains and supply chains.
Global Value Chains and the Trade Policy of the Future
On Wednesday, May 3rd, WITA held the second event in its NextGenTrade™ signature series on the Future of Trade and Global Value Chains. Discussants examined how trade policy should be adapted to anticipate the future of global value chains and supply chains.
The Future of Trade, Business, Work and Politics in a 5G World
On Friday, April 28th WITA hosted the first event on its NextGenTrade’s ™ signature series on Global Value Chains looking at five mega trends that are shaping the future of trade, business, work and politics.
Do Trade Deficits Matter?
On March 31st, the same day that President Trump is issuing his Executive Orders on trade enforcement and trade deficits, WITA hosted an event that looked at the significance of trade deficits to our overall economy. A panel of experts debated whether bilateral trade deficits are a measure of an effective trade policy and if they should they drive a renegotiation of existing trade agreements.
The Trade Law Toolbox
On March 23rd, WITA hosted an event that examined the various enforcement provisions in U.S. trade laws that could be used by the new administration. A panel of experts discussed how this agenda may unfold over the next four years and analyzed the impact it might have on U.S. jobs, American consumers, and the global trading system.
The Past, Present, and Future of US-China Trade
The US and China have been trading with each other for over 200 years. On Thursday, February 17, WITA examined the past, present, and future direction of US-China trade relations.
NAFTA 2.0?
On Thursday, February 9, before a standing-room only crowd, WITA examined what revisiting the 23-year old agreement might look like. Experts discussed the legal and political implications of renegotiating NAFTA, and and did a deep dive into several critical industries and what changes to the Agreement might mean for their sectors.
Border Adjustment Taxes, Tax Reform and Trade
WITA held a signature event looking at the Brady-Ryan tax reform blueprint, and their proposal to tax imports from around the world. The event
featured two expert panels, one examined the Brady-Ryan plan in the context of existing US
and global tax regimes, and the second heard from industry supporters and opponents of the
proposal.
What’s Next for Trade in a Time of Change
On Thursday, December 15, WITA took a tour of the global trade and investment landscape at an event moderated by Steve Lamar, Executive Vice President of American Apparel & Footwear Association and WITA Board President.
Armchair & Panel Discussion on TPP’s Consumer Impact
The New Rules & Disciplines of a 21st Century Agreement
TPP Series: Impact on Manufacturing
TPP Seriers: What’s at Stake for Agriculture?
TPP Series: What will TPP Mean for the States?
TPP Series: Services
TPP Series: Intellectual Property Rights
The Future is Now: Digital Trade in the TPP
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