Event Video: Renewing AGOA, GSP and HOPE/HELP For Haiti
On July 10, WITA hosted an online event to discuss the prospects for renewal of the Generalized System of Preferences – a critical program for the U.S. in Southeast Asia, the Middle East, southeastern Europe, South America, and the Pacific Islands – which lapsed in 2020; as well as AGOA, and HOPE/HELP for Haiti, which both expire in 2025.
Featured Speakers:
Fernando Capellán, President and CEO, Grupo M & Codevi
Ed Gresser, Vice President and Director for Trade and Global Markets, Progressive Policy Institute
Beth Hughes, Vice President, Trade and Customs Policy, American Apparel & Footwear Association
Olawunmi Osholake, Deputy Managing Director, Global Shea Alliance
Moderator: Nicole Bivens Collinson, Managing Principal, Operating Committee, International Trade & Government Relations Practice Leader, Sandler, Travis & Rosenberg, P.A.
07/10/2024 | Washington International Trade Association
Are Americans Ready for the U.S.-China Trade War?
It is hard to think of an issue that brings together the United States’ deeply divided political class more than the need to contain China’s growing influence, whether through trade restrictions, tariffs on Chinese electric vehicles (EVs), or banning TikTok. But while the national-security argument for such protectionist measures is undeniably compelling, it is unclear whether US political leaders and the American public are prepared for the potential economic fallout.
The prevailing belief among policymakers is that the surge of Chinese imports into the US market during the 2000s hollowed out America’s manufacturing base, making the kind of rapid military build-up that enabled the Allies to win World War II all but impossible. In US policy circles, the “China Shock” is often portrayed as a massive error that devastated towns across the Rust Belt and led to a sharp increase in inequality.
Consequently, there is widespread agreement among policymakers and commentators that the US must prevent a “China Shock 2.0” by imposing massive tariffs and trade restrictions on Chinese technologies such as cell phones, drones, and, crucially, EVs, solar panels, and green-energy equipment. President Joe Biden and his predecessor, Donald Trump, the presumptive Republican nominee in November’s presidential election, disagree on most issues. When it comes to dealing with China, however, both appear to be competing for the title of America’s most protectionist president.
But the China Shock narrative that underpins current US trade policy is deeply flawed. While competition with Chinese producers has adversely affected some manufacturing jobs, free trade has undoubtedly created more winners than losers. Moreover, low-income US consumers have been among the biggest beneficiaries of low-cost Chinese imports. Policymakers who believe that unwinding trade with China will not result in price increases and significant political backlash are in for a rude awakening.
07/08/2024 | Kenneth Rogoff | Project Syndicate
U.S. Engagement in the Indo-Pacific: Don’t Trade Away Trade
International trade has been a pillar of U.S. foreign and domestic policy for most of the post–World War II era. Policymakers from both major parties have treated strong international economic relationships built on expanding international trade as central to advancing economic growth at home and achieving American goals on international development and security abroad.
Secretary of the Treasury Janet Yellen captured the old consensus position well in an April 2023 speech explaining that “our economic power is amplified because we don’t stand alone. America values our close friends and partners in every region of the world, including the Indo-Pacific. In the 21st century, no country in isolation can create a strong and sustainable economy for its people.” Her words echoed those of one of her predecessors, Henry Paulson, who remarked sixteen years earlier on the benefits of open economic exchange that “countries that weren’t afraid of competition, that opened themselves up to trade, competition and trade, investment and finance, benefited, [whereas] the rest of the world, others were left behind. And opening . . . up to this competition leads to innovation, it leads to better jobs, more jobs, it leads to a higher standard of living.”
But in a very different April 2023 speech, U.S. President Joe Biden’s national security adviser, Jake Sullivan, laid out the administration’s case against globalization as it had been pursued in the past and argued for a new economic approach. While acknowledging that international economic cooperation “lifted hundreds of millions of people out of poverty” and “sustained thrilling technological revolutions,” he also argued that it all came at a price. To wit: “A shifting global economy left many working Americans and their communities behind.” The inexorable push for scrapping trade barriers had other costs, too, he continued—among them, the hollowing out of America’s industrial base, inequality that has threatened U.S. democracy, increasing environmental consequences, and geopolitical risks created by dependence on rivals such as China.
According to Sullivan, the Biden administration was forging a new path: not one that entirely rejected trade liberalization, but also not one that embraced traditional free trade agreements or tariff reductions as the main destination. He framed the approach as a middle ground, focused on advancing economic cooperation by pursuing nontrade priorities such as supply chain resilience, secure digital infrastructure, sustainable clean energy transition, and job creation. Sullivan described a new economic model that would be worker-centric, combining industrial policy to support high priority sectors with efforts to harmonize labor and environmental standards and integrate supply chains with close allies and partners—but without offering new market access.
06/25/2024 | Jennifer Kavanagh & Mariano-Florentino (Tino) Cuéllar | Carnegie Endowment for International Peace
The United States Tells China to Kick Rocks in Central Asia
WITA will host a panel event at this year’s WTO Public Forum in Geneva, Switzerland. The panel will explore how the WTO can help foster a circular economy for critical minerals.
WITA will also be hosting its first International Trade Reception at the Public Forum in Geneva. The reception will be held at the World Trade Organization headquarters. More information can be found here and below.
The United States is looking to diversify its critical minerals supply chain by establishing partnerships with the Central Asian republics and reducing its dependence on China, which currently dominates the global supply of these essential materials. China has been increasing its economic influence in Central Asia in recent years, and the United States now faces an uphill battle to establish itself as a compelling alternative.
To address its growing demand for critical minerals, the United States has started to deepen its partnerships with the Central Asian republics — Kazakhstan, Uzbekistan, Turkmenistan, Kyrgyzstan and Tajikistan. But it is not easy.
The 2022 Critical Minerals List identifies 50 minerals as crucial for the United States, underscoring their vital role across various industrial and technological sectors. Currently, the United States predominantly sources these essential materials from China. This dependency is extreme for certain minerals, with the country relying entirely on China for its supply of arsenic, gallium, graphite, tantalum and yttrium.
But the restrictions imposed by China on gallium and germanium exports in August 2023 have caused controversy. The fact that China has 94 per cent of the world’s gallium resources and 83 per cent of germanium resources poses a particular problem for the United States.
According to the Pentagon’s statement following China’s restriction decision, the United States has not developed the industrial capacity for producing gallium, though they do have some germanium reserves. US officials called for alternative markets to be found, and it was during this period that the United States decided to improve relations with Central Asia.
07/04/2024 | Mehmet Fatih Oztarsu | East Asia Forum
The Invisible Borders: Navigating Trade and Security in the Digital Age
In the digital age, the lines between global commerce and national security are increasingly blurred, presenting a new challenge for governments worldwide: navigating the complex relationship between digital trade and security. This balancing act is not just a technical endeavor—it is a defining challenge of our time, with broad implications for the future of international policy.
With e-commerce reaching staggering heights, the narrative of digital trade is often celebrated for its exponential potential to elevate businesses, large and small, to global platforms, and for driving a services-led economic revolution. The $2.41 trillion digital economy underscores the critical role of data flows in international trade.
However, this very backbone of digital trade — the free flow of data — now carries with it an intrinsic risk, transforming every business into a potential node of vulnerability. The cyber theft of intellectual property and personal data is emerging not just as a commercial hazard but as an acute national security threat. The 2017 WannaCry ransomware attack, which paralyzed over 200,000 computers across 150 countries, and the NotPetya attack, which caused unprecedented disruption to supply chains and major businesses like Maersk, highlight the critical need for countries to strengthen their defenses.
Policy development in the digital trade domain is witnessing unprecedented complexity. The European Union’s General Data Protection Regulation (GDPR) marked a significant policy shift, setting new global standards for data protection and influencing digital trade practices worldwide. Similarly, India’s draft e-commerce policy and the United States’ proactive measures through the Cybersecurity and Infrastructure Security Agency (CISA) reflect diverse, national strategic approaches to navigating digital trade regulation and cybersecurity.
07/05/2024 | Shehryar Qaisrani | International Policy Digest
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Information about upcoming WITA and trade community events