China went from a net importer of critical intermediary goods such as glass, paper, steel, and auto parts, to becoming the leading producer and dominant global exporter of these products. How could this seismic shift occur in industries where China does not maintain a particular advantage in labor, technology, or natural resources? The answer in large part is subsidization of Chinese production in the form of state-directed capital flows.
It’s on. Super Bowl Sunday approaches amidst a swirl of controversies over bad calls and “unfair competition” on the football field. We take no opinion on that here at TradeVistas. Instead, we bring you a trade showdown between the exporting profile of the metropolitan area where each team is located. Share the graphic and enjoy your guacamole that was probably made from Mexican avocados.
In a new survey conducted by the World Economic Forum (WEF), global leaders cite geo-economic tensions as the top risk for 2019. These leaders from government, business, and civil society are most concerned about economic confrontations among the world’s major powers and erosion of World Trade Organization (WTO) rules and agreements. We continue our ongoing series on competition policy and subsidies with a look at ongoing negotiations at the WTO to reduce subsidies that contribute to overfishing.
Government subsidies to fishing industries may be accelerating the depletion of fish stocks. Nearly 90 percent of the world’s fish stocks are at risk of being overfished. WTO members first started negotiating on fisheries subsidies in 2001 and have vowed to reach an agreement restraining these kinds of subsidies by the end of 2019.
After a decade of setting the topic aside in the WTO, concerns appear to be rising to surface again that certain anti-competitive government practices may not be covered sufficiently – or at all – by provisions in global trade agreements.
This week we look at the ongoing U.S.-China trade talks and explain why there’s no quick fix to be had even if a deal is struck. We also examine whether provisions in trade agreements can adequately address the problem of anti-competitive behavior and discuss whether trade wars are dampening the appetite for new merger and acquisition deals in 2019.
The announcement that trade talks in Beijing between the United States and China had been extended by a day sparked an uptick in stocks and renewed optimism that a resolution to the trade war might be in the offing. A minimal face-saving agreement should be possible before the March deadline, but this would only delay the ultimate day of reckoning. Friction points between China’s state-directed economic system and the United States’ ostensibly free market, free trade system will reassert themselves sooner rather than later.
In the very big picture, the U.S.-China trade talks are really about a competition of ideas about how a free market operates – the invisible hand versus the hand of government. In this newsletter we launch a new series of articles focused on the relationship between competition policies and trade disciplines. We also take a look at the role of state-owned enterprises and various forms of subsidies in key economies such as China’s.
Domestic competition policies aim to promote equitable opportunities to compete in the marketplace. They are oriented toward fostering the most efficient use of resources and increasing the incentives to innovate, both of which result in lower prices, better quality, and more choice for consumers. But domestic competition policies have limitations when it comes to cross-border transactions.For over two decades in international forums, governments have discussed whether and how to develop common approaches to national competition policies.
Chicken trade has been a sore spot in bilateral agricultural trade since 2004 when the United States and China banned each other’s poultry products after an outbreak of avian flu. If these long-simmering disputes are resolved in the context of ongoing U.S.-China trade talks, millions of Chinese could again see American chicken feet grace the dim sum buffet at Chinese New Year festivities.