...UNITED STATES-CHINA TRADE WAR: SIGNS OF PROTECTIONISM IN A GLOBALIZED ECONOMY? NAME: Kara Loridas LEXISNEXIS SUMMARY: ... Among the aims of the Doha Development Round are a rejection of protectionism and an attempt to ensure fair application of trade rules to developing countries. ... China argued that the increased tariffs imposed by the United States on Chinese tires exceed the permissible maximum tariff rates that the United States may impose on Chinese imports. ... An example of effective negotiations is the settlement of the U.S. complaint alleging a Chinese violation of the national treatment concept by its preferential treatment of domestic products over "like" imported products. ... Cooperative trade relations between the United States and China are important to the global community because the economies of each country are dependent on the rest of the world and the global economy will be harmed by protectionist measures from the first and third largest trading powers. ... Moreover, multilateral negotiations, as opposed to bilateral trade negotiations, are better suited to resolve the United States-China trade disputes because the disputes affect other WTO members in ways beyond the immediate economic impact. ... The most effective way to combat the rapid escalation and retaliatory nature of the disputes is to conduct multilateral negotiations that will preserve the WTO's goal of reducing trade barriers, avoid the adversarial nature of WTO litigation, and allow the countries...
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...and whatever was considered to have a bearing on the development of international trade, and was based on policies of non-discrimination and tariff reductions. GATT has been expanded and updated through a series of multi-year conferences. The most famous have been the Kennedy Round (1963-1967), the Tokyo Round (1973-1979), and the Uruguay Round (1986-1994). The Uruguay Round ended with the decision to dissolve GATT and establish the more powerful and more institutionalised World Trade Organization (WTO) in 1995. The WTO replaced GATT as an international organization, but the General Agreement still exists as the WTO’s umbrella treaty for trade in goods. Trade lawyers distinguish between the GATT 1994, the updated agreement, and the GATT 1947, the original agreement which is still the heart of GATT 1994. Introduction The WTO has nearly 150 members, accounting for over 97% of world trade. Around 30 others are negotiating membership. By definition, the World Trade Organization (WTO) deals with the rules of trade between nations at a global or...
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...Election year is always a difficult time for those who expect politicians and pundits to remain rational. The political maneuvering started a while ago and clean energy became another point of contention between various political factions. “ONE YEAR AGO TODAY, THE SOLAR MANUFACTURER SOLYNDRA FILED FOR BANKRUPTCY AFTER RECEIVING A $527 MILLION LOAN GUARANTEE. THE BANKRUPTCY SET OFF A POLITICAL FIRESTORM IN CONGRESS, AND EVENTUALLY WORKED ITS WAY INTO THE PRESIDENTIAL CAMPAIGN. TODAY, THE REPUBLICAN PARTY IS USING SOLYNDRA AS A KEY TOOL IN ITS CAMPAIGN AGAINST OBAMA — SMEARING THE ENTIRE CLEAN ENERGY INDUSTRY IN THE PROCESS.” (Lacey, 2012) Campaigns of this magnitude have a significant impact on the international political scene, and economic decisions. Considering that currently China has a very large and inexpensive manufacturing capabilities, as comparing to those in the U.S.; it should not come as a surprise that they can outperform Western (U.S.) manufactures. “PRICES OF SOLAR PANELS HAVE PLUMMETED, CAUSING A SUPPLY GLUT AND SLICING COMPANY REVENUES. SOLYNDRA'S COLLAPSE MARKED THE THIRD TIME IN AS MANY WEEKS THAT A SOLAR COMPANY DECLARED BANKRUPTCY. EVERGREEN SOLAR INC. OF MASSACHUSETTS AND SPECTRAWATT OF NEW YORK ALSO FILED FOR PROTECTION. (Mulkern, 2011). Clean energy is not only appealing to the United States, “THE CHINESE GOVERNMENT IS [also] INVESTING IN SOLAR PRODUCTION, WHICH HAS LED TO A BURST IN PRODUCTION THAT HAS BOOSTED SUPPLIES AND FORCED DOWN PRODUCT PRICES...
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...allowed, larger nations would monopolize trade to their advantage and destroy open competition. The purpose of this paper is to review the history of trade to find out the reasoning behind establish a General Agreement on Tariffs and Trade (GATT). To meet this goal, this student will quickly review world history concerning trade, the introduction of GATT, its successes and weaknesses, and the emergence of the World Trade Organization (WTO) as a successor to GATT. From this literary review, I will cite three current examples – within the last decade – on how recent tariffs and trade barriers still affect the United States of America: * 2002 - US Steel tariff * 2007 - Paper tariff on Chinese Paper * 2009 - Violation of North American Free Trade Agreement with Mexico and its effect on US trade Finally, I will give me opinion on whether or not I believe the WTO/GATT is still relevant for 2012 and beyond. Why Was There A Need For A General Agreement on Trade and Tariffs? The history of trade – and protectionism of the trade of goods – is record all the way back to the Roman Empire. Trade at that time was characterized by Roman control over roads and on ships throughout the Mediterranean region. If you wanted to move your goods, you would at one point pay the Roman Government. Other countries, such as the Netherlands, Hong Kong, and Great Britain, followed in the same paths of controlling geographic regions and the types of vessels trade could be...
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...Geethanjali Nataraj NCAER, New Delhi For the ICRIER-SABER workshop, 29-30 June p, 2009, New Delhi. Trade Policy in India • Trade Reforms form the crux of the economic reforms in India. • Export Promotion has been and continues to be a major thrust of India’s trade policy • Accordingly, policies have been aimed at creating a friendly environment by eliminating redundant procedures, increasing transparency by simplifying the processes involved in the export sector and moving away from quantitative restrictions, thereby improving the competitiveness of Indian industry and g p reducing the anti-export bias. • Steps have also been taken to promote exports through g g multilateral and bilateral initiatives and giving several incentives to exports to cope with all uncertainties at the global level. Features of Trade Policy Reform in India • • • • • Free imports and Exports Rationalization of tariff structure/reducing tariffs Decanalisation Liberalization of the exchange rate regime. Setting up of trading houses, SEZ’s and Export houses SEZ s promotion industrial parks. • Various exemptions under the EXIM policies to boost exports and imports and make the trade policy regime transparent and less cumbersome. p Towards a more open economy 1990 91 1990-91 Peak Import duties ( Manufactures ) Import Controls Trade goods)/GDP ratio ( %) Software exports ( & billion) Worker remittances ( $ billion) FDI ($ billion) g y Foreign currency reserves ($ billion) 200% plus Tight, Tight detailed...
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...Quiz Review Word Bank 1. Fair trade 2. Guanxi Connections usually referring to government contacts and influence. 3. ATC In 1994, as a result of the Uruguay Round of negotiations, GATT was absorbed into the WTO. The WTO also absorbed the MFA, which was replaced by the ATC. The purpose of the ATC was to phase out the MFA and its quota system over ten years. 4. Free trade a agreements (FTAs) 5. Intellectual property rights The WTO is not just about liberalizing trade. In some circumstances its rules support maintaining trade barriers, for example protecting intellectrual property rights, patents, trademarks, and copyrights, but it is difficult to protect them from unscrupulous business from other countries. 6. NTBs In recent years, however, the United States-as well as most countries world-wide, has established bilateral or multilateral free-trade agreements (FTAs) between two or more countries to eliminate tariff and non-tariff barriers affecting trade among themselves. 7. Portfolio Investment It is a non-controlling interest in a venture made in the form of either debt or equity. 8. SMEs It benefits from the tariff-eliminating provisions of free trade agreements, and should benefit from the significant tariff cuts required under the CAFTA-DR. The transparency obligations, particularly those contained in the customs chapters, are also very important to SMEs, which may not have the resources to navigate customs and regulatory...
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...of the United States Methods of Promoting Trade Subsidies Subsidies in Media and Entertainment Drawbacks of Subsidies Export Financing Foreign Trade Zones Special Government Agencies Methods of Restricting Trade Tariffs Protect Domestic Producers Generate Revenue Quotas Reason for Import Quotas Reasons for Export Quotas Voluntary Export Restraints Tariff-Quotas Embargoes Local Content Requirements Administrative Delays Currency Controls Global Trading System 1 General Agreement on Tariffs and Trade (GATT) Uruguay Round of Negotiations Agreement on Services Agreement on Intellectual Property Agreement on Agricultural Subsidies World Trade Organization (WTO) Dispute Settlement in the WTO Dumping and the WTO Subsidies and the WTO Doha Round of Negotiations The WTO and the Environment Bottom Line for Business Implications of Trade Protection Implications of the Global Trading System A comprehensive set of specially designed PowerPoint slides (designated ‘PPT’ below) is available for use with...
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...States Methods of Promoting Trade Subsidies Subsidies in Media and Entertainment Drawbacks of Subsidies Export Financing Foreign Trade Zones Special Government Agencies Methods of Restricting Trade Tariffs Protect Domestic Producers Generate Revenue Quotas Reason for Import Quotas Reasons for Export Quotas Voluntary Export Restraints Tariff-Quotas Embargoes Local Content Requirements Administrative Delays Currency Controls Global Trading System General Agreement on Tariffs and Trade (GATT) Uruguay Round of Negotiations Agreement on Services Agreement on Intellectual Property Agreement on Agricultural Subsidies World Trade Organization (WTO) Dispute Settlement in the WTO Dumping and the WTO Subsidies and the WTO Doha Round of Negotiations The WTO and the Environment Bottom Line for Business Implications of Trade Protection Implications of the Global Trading System A comprehensive set of specially designed...
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...ECO212 Scott Shaw 3/20/2011 Trade in today’s society is one of the major ways goods get around the world. This includes services provided in the United States, as well as those around the world. It is both mind boggling and perplexing the number of goods traded on a daily basis. With this major amount of trading there are both advantages and disadvantages. Let’s look at some of these advantages and disadvantages of trading internationally as well as some issues that arise due to international trade, the role of the government in the trading process, and the role of the World Trade Organization (WTO). An advantage of international trade is that it allows for the enhancement of domestic competitiveness. This allows an organization to get offers from other countries in the future which gives them the variety to choose from in the long term. Another advantage to trading internationally is that an organization can reduce their dependence on existing markets. If a market is low on a substance that is needed, then the organization can trade for it internationally with a country with a plentiful supply of what you need. Also, international trading will extend the sales potential of existing products. The more exposure that the product gets in international markets, the more profits a company sets to gain, thus creating better sales opportunities in the long run for the company doing the trading. With these advantages, there comes some disadvantages. One disadvantage...
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...Policy of the UK: Does the protectionism help? Introduction The effects of globalization have touched all the aspects of life and business today. One aspect is the trading policies between countries. Since the late nineteenth century, the collision started between domestic and foreign industries, which ask governments for measures that could protect local industries, without discouraging the country’s trade relations. The term ‘Protectionism’ was thus introduced in the language of global trade and economy (Rowley, 2002). Protectionism is an economic policy applied in the trading system, to restrict the quantity of imported items, and to flourish country’s exports. The objective of this is policy is to maintain the competition between foreign and the domestic industries. In most of the countries, free trade is not followed and various tariffs and duty charges are applied on the import goods. These taxes allow the government to generate a fair bit of revenue, without utilizing their resources. Moreover, it also helps in the sustainability of the domestic industries. The prices of the imported goods are kept higher by adding these taxes so that the local customers, looking for cheaper options, have to buy the domestic items. In parallel to this, the protectionism policy allows domestic industries to raise the prices of their products, without raising the quality of their products (Ethier & Fischer, 1987, pp.1-2). Another aspect of protectionism is the allegation of quota...
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...Chapter 7 Government Intervention in International Business GOVERNMENT INTERVENTION 1. In a short essay, describe two methods of government intervention. What is the purpose of government intervention in international business? Answer Government intervention is often manifested as protectionism. Protectionism refers to national economic policies designed to restrict free trade and protect domestic industries from foreign competition. Protectionism often leads to two types of intervention: tariffs and nontariff barriers. A tariff is a tax imposed by government on imported products, effectively increasing cost of acquisition for the customer. A nontariff trade barrier, such as a quota, is a government policy, regulation, or procedure that impedes trade through means other than explicit tariffs. Governments intervene in trade and investment to achieve political, social, or economic objectives. Barriers are often applied to benefit specific interest groups, such as domestic firms, industries, and labor unions. A key rationale is to create jobs by protecting industries from foreign competition. Governments may also intervene to support home-grown industries or firms. In various ways, government intervention alters the competitive positions of companies and industries, and the status of citizens. (pp. 195-196; concept; Learning Objective 1; moderate; AACSB: Analytic Skills) RATIONALE FOR GOVERNMENT INTERVENTION 2. In a short essay, explain the four main motives for...
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... Ah REGISTERATION NO :078 Submitted to sir saqib fareed sheikh GLOBALIZATION Globalization is the process of international integration arising from the interchange of world views, products, ideas, and other aspects of culture. In particular, advances in transportation and telecommunications infrastructure, including the rise of the Internet, are major factors in globalization and precipitate further interdependence of economic and cultural activities. GATT General agreement on tariffs and trade, an international treaty (1948–94) to promote trade and economic development by reducing tariffs and other restrictions. it was superseded by the establishment of the world trade organization in 1995 History of GATT • Following World War II, the victor nations sought to create institutions that would eliminate the causes of war. • Their principles were to resolve or prevent war through the United Nations and to eliminate the economic causes of war by establishing three international economic institutions. GATT, 1947 Because the ITO was stillborn the provisional agreement for the ITO, the General Agreement on Tariffs and Trade (GATT) became the agreement and the organization for establishing and enforcing, through dispute settlement, the international trade rules. • In 1995 this agreement on trade in goods became...
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...1. Explain three gains form trading internationally. International trade is made exchange product, service, and factor of product in different country or place. International trade also called word trade. It reflects that Countries in the world economy on the coexistence relationship. * to exploit comparative advantage 2. Providing a recent example, explain what is meant by free trade. Free Trade mean that state cancel constraints and obstacles on import and export trade, Cancel all kinds of preferential treatment and privileges of national import and export commodities，without interference and restrictions for Import and export commodities, let goods free import and export，Free competition in the domestic market of trade policies. For example: In April 7,chain with New Zealand concluded free trade agreements（FTA），this is first free trade agreement with developed countries. Now chain have building or discuss FTA have 12, involved 29 countries or place, cover 1/4 of chain total foreign trade. In 2007 Trade between the two countries reached 159.9 billion U.S. dollars. Expected in 2008, bilateral trade will reach 170 billion U.S. dollars，2010 get200 billion，5years later 2013 will get 250 billion. 3. Explain absolute and comparative advantage what is meant by free trade. Absolute advantage is said occur when one country can product a good or service to a pre-determined quality more cheaply than another country. Comparative advantage was first described...
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...Foreign Trade and Exchange International trade exists due to things produced in a particular country that individuals, firms and governments in foreign countries want to purchase. Trade provides a greater selection of goods and services to choose from, often at lower costs than at home. In order to prosper and profit, countries want to use their resources such as labour, land and capital, as efficiently as possible. However, the quantity, quality and cost of resources can differ substantially between countries. Some have natural advantages, such as ample minerals or a climate suited to agriculture. Others have a well-trained workforce or highly developed infrastructure, advanced telecommunications systems and reliable electric utilities, which benefit the production and distribution of goods and services. Canada, as an example, depends heavily on trade to sustain incomes and living standards of Canadians and the prosperity of the nation. Other than trying to produce everything domestically, which would be inefficient, countries often concentrate on producing those things that they can produce best, and then trade for other goods and services. By doing so, both the country and the world become wealthier. Today, most industrialized nations could produce almost any product they chose. However, this does not make good economic sense. Much of the labour, land and capital that would have to be directed toward the production of a new item unfamiliar to that nation could be used more...
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...Import Quotas and Voluntary Export Restraints Local Content Requirements Administrative Polices Antidumping Policies Management Focus: U.S. Magnesium Seeks Protection THE CASE FOR GOVERNMENT INTERVENTION Political Arguments for Intervention Country Focus: Trade in Hormone-Treated Beef Economic Arguments for Intervention THE REVISED CASE FOR FREE TRADE Retaliation and Trade War Domestic Politics DEVELOPMENT OF THE WORLD TRADING SYSTEM From Smith to the Great Depression 1947-1979: GATT, Trade Liberalization, and Economic Growth 1980-1993: Protectionist Trends The Uruguay Round and the World Trade Organization WTO: Experience to Date The Future of the WTO: Unresolved Issues and the Doha Round Country Focus: Estimating the Gains from Trade for America FOCUS ON MANAGERIAL IMPLICATIONS Trade Barriers and Firm Strategy Policy Implications SUMMARY CRITICAL THINKING AND DISCUSSION QUESTIONS CLOSING CASE: Agricultural Subsidies Learning Objectives 1. Describe the policy instruments used by governments to influence international trade flows. 2. Understand why governments sometimes intervene in international trade. 3. Articulate the arguments against strategic trade policy. 4. Describe the development of the world trading system and the current trade issues. 5. Explain the implications for managers of developments in the...
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