Tag Archives: Protectionism

Doha Round Still Unresolved

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On Wednesday, 153 nations met to discuss the Doha Round, but left with little to no progress, states the Wall Street Journal. The Doha Round plan was created with a mission of opening rich-country markets to import food from the developing world. After eight years, little development has been made. Furthermore, issues such as the drop in trade and the hot topic of protectionism has reduced the enthusiasm to create a plan that everyone agrees with.

What is on the table doesn’t deliver “meaningful market access in the part of the world that will be growing and driving GDP growth over the next few years,”  U.S. Trade Representative Ron Kirk said, in a reference to countries like China, India and Brazil.

Not all countries are statisified with what is on the table so far. Some believe that the wealther countries will still profit more than the developing countries.

But, as Mr. Kirk puts it best:

The Doha Round “is like a cricket match. You don’t know the score and it takes a long time, but it does end, and there is a winner.”

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Obama and Hu Jintao to Talk Trade Among Topics to Discuss

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President Obama landed in China on Sunday to discuss some much needed topics with President Hu Jintao, according to Time magazine. One topic is trade. In recent months, trade issues has been heated between the two nations as both have thrown around the idea that each nation is participating in protectionism since the recession began.

“They’re working through a lot of scattered issues, but they are working through the WTO,” says James McGregor, the former chairman of the American Chamber of Commerce in China. “In the old days, every trade issue would become a very public and unstructured argument.”

China and the U.S. trade around $400 billion in goods each year. Many trade experts were concerned tension may get too high, making resolution difficult. But, U.S. officials dismiss that allegation, saying that the affected goods are only a small part of the total trade exchange.

Wanna read more: http://www.time.com/time/world/article/0,8599,1939536,00.html?xid=rss-topstories

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New European Trade Measure Not Caused by Protectionism

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The New York Times reports that European exporters has been confronted with more than 223 new and restrictive trade measures since the beginning of the trade crisis last year, but has avoided protectionism. A new report out last Friday introduces the new trade measures issues by EU Commission and its trading partners.

“Proliferation of the kind of beggar-thy-neighbor protectionist policies of the 1930s has been prevented,” adds the document, which was reviewed by the International Herald Tribune. “The current multilaterally based world trade system seems to have passed one of the most serious stress tests in its entire history.”

The report concludes that the 18 percent decrease in trade since 2008 is due to financial crisis rather than protectionism.

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“European and North American Politicians Are Plotting the Biggest Trade Deal of the 21st Century”

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According to CNN, EU and Canadian officials sat down in Prague to begin discussions on a new Free Trade Agreement.  Let’s just say, discussions went well because if the other NAFTA countries sign in, this could be the ‘biggest trade deal of the 21st century.’ NAFTA-EU trade would contain nearly 1 billion people and account for $35.2 trillion in annual GDP, more than half the world’s trade.

“The largest benefits will come from economic integration,” says Jayson Myers, president of Canadian Manufacturers & Exporters (CME), the country’s largest trade and industry association. By that he means increased foreign direct investment, improved labor mobility and full access to government procurement.

But, will this new proposed trade agreement see the light of day? That may be up to the U.S. Canada is more dependent on exports than the U.S., and with the new ‘Buy-American’ campaign from the Obama Adminstration, this could be a hard sell.

“The ball is in the Obama administration’s court,” says Steven Schrage, a specialist in international business at the Center for Strategic and International Studies (CSIS) in Washington. “If they want this to happen, they can move rapidly.”

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U.S Officials Meet In China to Talk Trade

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Today, top trade officials from the United States and China will meet in Hangzhou to discuss trade relations between the two countries, according to Business Week. Recent tension has added some much needed topics to the table to discuss, particularly protectionism.

Beginning in September, President Obama added 35% duties on China-produced tires. And earlier this month, the U.S. Government launch an investigation into whether to raise tariffs on Chinese-made steel pipes. The Chinese Government quickly  responded by launching its own investigation into possible anti-dumping of chicken and auto parts by U.S.

Other topics the U.S trade representatives want to discuss are:

- undervalued Chinese currency

-and, China’s poor record of protecting intellectual property rights, such as software, movies and music

Check back for changes that come from today’s meeting.

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Canadians Going Hog Wild Over Protectionism

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Canada asks the World Trade Organization (WTO) to rule against an American food-labeling law that seems to have destroyed much of its hog-farming industry, states the New York Times. The dispute derives from an American rule requiring that food products be labeled by country of origin. The U.S. government denies that labeling  its food products is an act of protectionism, although Americans have decreased purchases of pork produced in Canada, traditionally about 7 percent of Canadian pork is consumed in the United States.

The Canadian international trade minister, Stockwell Day, publicly criticized the rules “as so onerous that they affect the ability of our cattle and hog exporters to compete fairly in the United States.” He said Canada “has no choice” but to request that the World Trade Organization scrutinize the labeling rules.

The U.S. trade representative defended the allegations and its claim that the Obama administration is practicing protectionism by stating that the information on the labels given to consumers complies with the WTO.

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Protectionist or Pro-Free Trade?

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Is President Obama a protectionist or pro-free trade? Both, according to  a recent Los Angeles Times editorial.  President Obama has been quoted as saying more jobs are created and costs are lowered in a free trade economy. But, the recent Stimulus plan angered many with the ‘Buy American’ clause attached to the plan.

Recent news about the large tariff placed on China for its tire imports,  and refusing to allow Mexican truck drivers into the U.S. has also raised eyebrows to protectionism. But trade issues is not a new problem and not just in the United States.

Earlier this month, the WTO listed 91 potentially protectionist measures taken by G-20 members between the April summit in London and the end of August, and Global Trade Alert, a trade watchdog group affiliated with the World Bank, puts the number at 121 since November.

The position on protectionism or opening free trade even more will be answered in a matter of time. The G-20 summit began last week and will discuss these issues. President Obama will have the opportunity to make his stance on protectionism or pro-free trade more clear.

To read the full editorial, click here.

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China Cries Protectionism Against the United States

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According to Business Week, the Chinese government is upset with the newly increased tire tariff imposed by the Obama Administration.  The 35 percent increase comes in response to the U.S. steelworkers compliant to the U.S. Commerce Department that the Chinese government was subsidizing the steel industry.

 ”Providing relief for beleaguered tire workers was the right thing to do,” said Scott Paul, executive director of the Alliance for American Manufacturing, a coalition of the USW and steel companies. “President Obama deserves praise for being true to his word and for deciding a trade case based on facts rather than fears or philosophy. It bodes well for U.S. manufacturing that the Administration recognizes the need to enforce our trade laws.”

Beijing officials cry protectionism againist the U.S. government and is exploring the possiblity to file a compliant to the World Trade Organization.

The report claims that President Obama will need to help calm the waters to this disagreement before the G20 summit expected to begin in one week in Pittsburgh. The Chinese President is expected to attend and additional members have already vowed to avoid the subject of protectionism after reading reports to China’s reaction to President Obama’s response to the tariff increase.

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Japan’s Trade May Be On The Rise

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For the first time in 20 months Japan reported a surplus in trade this month, according to the Journal of Commerce.

For the past year, the demand for Japan’s exports in automobiles, steel and mineral fuels has dropped by fifty percent or more. Respectively, Japan has decreased its import of cruel oil and nonferrous metals by sixty to seventy percent.

Trade between Japan’s largest trading partner, the United States has decreased with the rest of the world. Lack of demand for automobiles in the U.S. is not surprising as Obama’s recovery plan allocated the use ”protectionism” with certain materials (refer to my previous blog post on Protectionism), making it difficult for foreign countries to compete.  

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Protectionism Alert

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Buy AmericanRecently, many news outlets have reported on “protectionism” on the rise in many countries, particularly the United States. “Buy American”  idealism has always sounded like  a choir-like voice  to many who work in the automobile industries and others manufacturer-related industries.

The New York Times recently reported a study from the European Bank in Feburary found that there is no clear evidence that protectionism is accuring, but there are clear signs of protectionism pressures are on the rise particularly in Europe and the U.S., where many of its citizens do not believe globalization benefits its nation.

The Associated Press reported recently that the Elite 8, plus 5 of the fastest growing developing countries called for more open markets and to fight againt protectionism during the recent G-8 conference in Italy.

The call for completing the trade deal, known as the Doha round of trade talks, comes at a particularly difficult time. The economic crisis is stoking protectionist impulses and forcing governments, especially the United States, to intervene in the private sector in extraordinary ways.

The Center for Economic Policy Studies, a London based research center began keeping track of any trade-distorting policies that may develop as the pressure thickens, called the ”Global Trade Alert.”  It’s a database that allows users to search by country imposing new policies, the countries affected and the product it limits.

Since the stimulus package was approved, “Buy American” laws have popped up meaning that provisions have been set that some projects will only be approved if the steel, iron and manufactured goods were produced in the United States. Several governments, not just the U.S., are challenged on how to protect domestic business and remain an open market.

In an attempt to avoid repeating that scenario, a draft of the joint statement signed by 17 nations reads: “We reaffirm our commitment to maintain and promote open markets and reject all protectionist measures in trade and investment.”

Time will tell if the agreement follows through.

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