Summary: Soumaya Keynes (The Economist) and Chad P. Bown (Peterson Institute for International Economics) cohost a podcast about the economics of international trade and policy. From trade wars to trade deals, this podcast covers trade developments with insights and economic analysis from two of the world's top trade geeks.
Two former USTR negotiators join to explain the details of the new US-China trade agreement. Agriculture negotiator Darci Vetter (Edelman, 3:50) describes China’s new commitments toward US farm products, and foreign investment negotiator Lauren Mandell (WilmerHale, 18:30) explains changes to China’s legal system, protection of intellectual property, as well as the agreement’s dispute settlement provisions. Finally, Simon Rabinovitch (The Economist, 37:15) joins to provide the reaction from China. Read more… Soumaya Keynes. 2020. The new US-China trade deal marks an uneasy truce. The Economist, January 16.Chad P. Bown. 2020. Managing Trade Expectations in the US-China Phase One Deal. PIIE Trade and Investment Policy Watch, January 21.Economic and Trade Agreement Between the Government of the United States and the Government of the People’s Republic of China. January 15, 2020.
New evidence reveals a side effect of President Trump’s import tariffs. The research shows that, through US supply chain linkages, the new US tariffs on imported inputs are directly contributing to the recent slowdown in US exports of outputs. Kyle Handley (University of Michigan) joins to discuss the potential causes and consequences of these results. Read more… Kyle Handley, Fariha Kamal and Ryan Monarch. 2020. Rising Import Tariffs, Falling Export Growth: When Modern Supply Chains Meet Old-Style Protectionism. NBER Working Paper No. 26611, January.
The WTO is failing to meet a 2020 deadline set by the UN’s Sustainable Development Goals to negotiate limits to fisheries subsidies. To figure out why, we went to Geneva and spoke with Alice Tipping (International Institute for Sustainable Development) and Mukesh Bhatnagar (Centre for WTO Studies). We describe difficulties on getting a deal to restrain subsidies which lead to overcapacity and overfishing, as well as eliminating subsidies that contribute to illegal, unreported and unregulated fishing. Read more… Basak Bayramoglu, Brian Copeland, Marco Fugazza, Jean-François Jacques. 2019. Trade and negotiations on fisheries subsidies. VoxEU.org, 21 October.FAO. 2018. The state of world fisheries and aquaculture 2018. Food and Agriculture Organizations of the United Nations, Rome.Marco Fugazza and Tansung Ok. 2019. Fish and fisheries products: From subsidies to non-tariff measures. UNCTAD Research Paper Series, UNCTAD, Geneva.Enric Sala, Juan Mayorg, Christopher Costello, David Kroodsma, Maria L. D. Palomares, Daniel Pauly, U. Rashid Sumaila, and Dirk Zeller. 2018. The economics of fishing the high seas. Science Advances.U. Rashid Sumail, Naazia Ebrahim, Anna Schuhbauer, DanielSkerritt, Yang Li, Hong Sik Kim, Tabitha Grace Mallory, Vicky W.L. Lam, Daniel Pauly, 2019. Updated estimates and analysis of global fisheries subsidies. Marine Policy 109: 103695.World Economic Forum. 2019. David Attenborough explains what we need to do to stop over-fishing. Youtube video, 8 October.
Republicans lost 40 seats in the 2018 elections for the US House of Representatives. Emily Blanchard (Tuck School of Business) joins to discuss new research that investigates how Trump’s trade war affected the 2018 election. The evidence suggests the combination of the trade war and attempts to repeal and replace the Affordable Care Act may have cost the Republicans as many as 15 House seats. Read more… Blanchard, Emily J., Chad P. Bown, and Davin Chor. 2019. Trump’s trade war cost Republicans congressional seats in the 2018 midterm elections. VoxEU.org, 26 November.Blanchard, Emily J., Chad P. Bown, and Davin Chor. 2019. Did Trump’s Trade War Impact the 2018 Election? Working Paper, November.
Trump’s US Trade Representative provides a fact sheet and more detail on the first stage of the deal announced December 13 to address the administration’s trade war with China. The fact sheet previews an eventual 86 page legal agreement that would include additional Chinese commitments on intellectual property rights protection, technology transfer, agriculture, financial services, currency, dispute resolution, and expanding trade. Bown and Keynes also discuss what the Trump administration has agreed to do with all of the new tariffs it has imposed on China, as well as what is not in the phase one deal. Read more… Soumaya Keynes. 2019. America and China reach a “phase one” trade deal. The Economist, 14 December.Chad P. Bown, 2019. Phase One China Deal: Steep Tariffs Are the New Normal. Peterson Institute for International Economics Trade and Investment Policy Watch Blog, 19 December.Chad P. Bown. 2019. US-China Trade War Tariffs: An Up-to-Date Chart. Peterson Institute for International Economics, 19 December.
USMCA gets one step closer after Congressional Democrats, organized labor, the Trump administration, and Mexico strike a deal. Megan Cassella (Politico, 2:18) explains how the four-way negotiations led to the December 10 announcement of additional tweaks to the new North American trade agreement, including on biologics. Simon Lester (Cato Institute, 14:13) and Kathleen Claussen (University of Miami, 20:00) also join to discuss changes to dispute settlement, and the enforcement of rules regarding labor. Read more… Soumaya Keynes. 2019. The revised USMCA pleases both Democrats and Donald Trump. The Economist, 12 December.
Government subsidies are a key battle area in today’s trade disputes between countries, including the US and China. But finding and measuring those subsidies is increasingly hard. Ken Ash uses the aluminum sector to describe the OECD’s new approach to tracking them down. He also previews a new OECD report on subsidies to semiconductors, and the role of government-sponsored equity injections. Read more… OECD. 2019. Measuring distortions in international markets: the aluminium value chain. OECD Trade Policy Papers, No. 218, OECD Publishing, Paris. http://dx.doi.org/10.1787/c82911ab-en
Stephen Vaughn, formerly the Trump administration’s USTR General Counsel, joins in a wide-ranging conversation about the Trump administration’s trade policy. They discuss critiques of the pre-Trump approach (3:04), as well as Trump’s approach on China (6:00), the European Union (18:30), the WTO Appellate Body (22:50), and more. Episode Transcript [PDF]
Companies can now “print” some products locally, obviating the need for trade. But for hearing aids, the economic shakeup has turned out different thus far. Caroline Freund and Michele Ruta (World Bank) join to discuss their new research examining the many ways the introduction of a transformative technology impacted global trade and consumer access to one important 3D-printed product. Read more… Freund, Caroline, Alen Mulabdic and Michele Ruta. 2019. Is 3D Printing a Threat to Global Trade? The Trade Effects You Didn’t Hear About, World Bank Policy Research Working Paper No 9024.Freund, Caroline, Alen Mulabdic and Michele Ruta. 2019. Trade effects of 3D printing (that you didn’t hear about). VoxEU.org, 28 October.
The WTO authorizes China to retaliate against US exports. The timing bodes poorly for an Appellate Body already under stress. They discuss how the US has failed to fix its antidumping and the “single rate presumption” issue in this dispute, as well as the history of WTO challenges to US use of trade remedies. As the clock ticks toward potential end of the Appellate Body on December 11, they also speak with former WTO AB member Peter Van den Bossche (World Trade Institute) about American complaints over judicial activism, overreach, and precedent at the WTO. Read more… World Trade Organization. 2019. “DS471: United States — Certain Methodologies and their Application to Anti-Dumping Proceedings Involving China.”
Services trade gets no respect. The release of the WTO’s World Trade Report 2019 gave us a chance to fix that. Roberta Piermartini and Stela Rubinova (World Trade Organization) as well as Alan Beattie (Financial Times) join to provide insights on services trade from the Report. They explain services trade’s growing importance relative to goods trade, the sectors and countries driving the increase, the various modes by which it is delivered, and why liberalizing services trade is just so hard. Read more… World Trade Organization. 2019. World Trade Report 2019: The Future of Services Trade, October.
Paul Blustein (Centre for International Governance Innovation) joins to discuss the contentious process of US-China negotiations in the late 1990s that ultimately resulted in China joining the World Trade Organization. Their discussion of his latest book – Schism: China, America, and the Fracturing of the Global Trading System – sets the stage for much of the subsequent challenges that continue to affect the US-China trade relationship today. Read more… Paul Blustein. 2019. Schism: China, America, and the Fracturing of the Global Trading System. Center for International Governance Innovation.Soumaya Keynes. 2019. The trade war did not start with President Donald Trump. A new book suggests it may not end with him either. The Economist, September 27.
Jenny Leonard (Bloomberg News) joins to update what is known about President Trump’s October 11 announcement of a potential deal to address his ongoing trade war with China. Their wide-ranging conversation covers Beijing’s take on these developments, how this agreement compares to what was on the table in May, as well as common misconceptions about the ongoing trade conflict. Read more… Jenny Leonard and Shawn Donnan. 2019. Trump Advisers Consider Interim China Deal to Delay Tariffs. Bloomberg News, September 12.Jenny Leonard, Saleha Mohsin, Josh Wingrove and Shawn Donnan. 2019. Trump Touts US-China Phase One Trade Deal, Delays Tariffs. Bloomberg News, October 11.Soumaya Keynes. 2019. A mini-truce between America and China has investors feeling hopeful. The Economist, October 12.
The World Trade Organization authorizes new US retaliatory tariffs on EU imports in one of the biggest and longest-running formal disputes in history. Former WTO Appellate Member Jennifer Hillman (Council on Foreign Relations) joins to explain the complexity of the case and what happens next. They discuss WTO rules on subsidies, upcoming US retaliatory tariffs on imported airplanes, billions of dollars of imported European cheeses, alcohol, and other consumer products, as well as the products the United States left off this round of retaliation. Read more… Soumaya Keynes. 2019. America is preparing to hit $7.5bn-worth of European imports with tariffs. The Economist, October 3.
A strengthening dollar reignites a recurring debate about how to hit back against countries that deliberately weaken the value of their currencies. Joseph Gagnon (PIIE) and Maury Obstfeld (PIIE, Berkeley) join to discuss two recent and controversial policies proposed to attack that problem. The first is retaliatory tariffs under US countervailing duty law. The second is to give the US Treasury and Federal Reserve new access to hundreds of billions of dollars to use as countervailing currency intervention. Read more… C. Fred Bergsten and Joseph E. Gagnon. Currency Conflict and Trade Policy: A New Strategy for the United States. Peterson Institute for International Economics, 2017.C. Fred Bergsten and Joseph E. Gagnon. Comments on Proposed Modification of Regulations for Countervailing Duty Proceedings. June 25, 2019.Joseph E. Gagnon and Christopher G. Collins. Despite Minor Changes in Treasury’s Foreign Exchange Report, Major Flaws Remain. Peterson Institute for International Economics Trade and Investment Policy Watch, June 12, 2019.Soumaya Keynes. America considers retaliating against currency manipulation. But such a strategy could easily backfire. The Economist, July 27, 2019.