News

Let’s push for Chindian trade

Sino-Indian trade has been historically important for both sides of the border but modern day political bickering threatens a bilateral relationship that is expected to reap a $100 billion benefit for both sides of the border in just a few years. As Alec van Gelder and Amitendu Palit argue in the Financial Express, it is crucial that both governments put aside their political differences and allow the world’s two most populous economies to continue benefiting from flourishing trade. To begin with, this involves shunning the vested interests that seek short-term protection and the expense of a potentially lucrative long-term partnership that could be one of the 21st century’s most important:

The Folly of Regionalism

Governments continue to embrace regional trade groupings as their preferred method for facilitating trade despite the fact that, when it comes to boosting growth and trade, regional integration is a poor substitute for unilateral liberalisation. By focussing on consensus and common denominators, regional groupings fail to address the real obstacles to trading- those imposed by governments which stifle everyday businesses. Where regional integration has been most successful is when groups work as loose forums for discussing ways to remove these barriers to trade.

Protecting the Dragon

China has recently made headlines by becoming the world’s largest exporter of merchandise goods. Unilateral liberalisation over the last 25 years has made China a profitable option for foreign businesses to outsource production. Supply and production chains that span the globe utilise Chinese division of labour. But this investment is dependent upon China remaining a profitable option and there are signs that rising Chinese protectionism may be threatening this.

Chinese exports are ours too...

In today’s Daily News Egypt Alec van Gelder and Daniel Ikenson report how China’s increasing export share is good news for everyone else.

Contrary to the rhetoric of the sinophobes, China relies on imports to feed its growing export businesses. But due to trade accounting much of the value-added that occurs elsewhere is fully incorporated into the total value of “exports”, even if only a small fraction of the value-added at the end of the production line actually takes place in China.

Africa Calling

The recent African Union summit, held in Ethiopia, focussed upon the impact of Information Communication Technology upon Africa. Few technologies can boast having as positive impact for Africans as the explosion of mobile phones. However, some governments continue to restrict their people from enjoying the benefits mobile technology can bring.

Sweet for farmers- sour for everyone else:

Coming just days after WTO officials vowed to continue fighting domestic protectionism, here is an example of the harm caused by “protection” sought by vested interests – at the expense of everyone else. Farmers in the U.S. enjoy protection against more efficient foreign producers of cane sugar: U.S. produced sugar has been, on average, twice as expensive as world sugar prices since 1980. This protectionism cost U.S. businesses and consumers $2.5 billion in 2009.

World Social Forum doesn't offer solutions to poverty

2010 is the 10 year anniversary of the World Social Forum (WSF) but, as Alec van Gelder reports, the event does not help address the real problems facing impoverished people around the world. Disguised by anti-globalisation rhetoric the forum lacks a pragmatic approach to economic development and trade. Contrary to the WSF’s socialist ideology poorer countries actually need more access to, and less protection from, global markets.

“Made in China” means “Made with the rest of the world”

The row over China’s domination of the global export market continues to simmer, but as Dan Ikenson tells us, Chinese growth benefits everyone.

Keep trade free, Australia!

In today’s The Australian, Tim Wilson details the benefits of the US/Australian Free Trade Agreement (FTA). Refuting the self-interested claims of the anti-trade minority he highlights the huge increases in U.S. investment in Australia since the inception of the agreement in 2005:

“According to the latest Australian Bureau of Statistics data, total US investment... has increased by an average of $20bn a year...”
“And attacking a marginal trade deficit increase ignores that free trade is not a zero-sum game and that imports deliver benefits as well.”

EU protectionism rises — from shoes to steel

Alec van Gelder and Timothy Cox have an article in today’s China Post detailing EU protectionism in 2009.

“The European Union (EU) imposed 89 new trade barriers in 2009 and rounded off the year by prolonging tariffs on shoes from China and Vietnam, originally due to expire in 2008.”