Monthly Archives: March 2016

WTO Panel rules in Argentina’s favour in EU Biodiesel Anti-dumping Case

Alicia Nicholls

A World Trade Organisation (WTO) dispute settlement body panel has ruled primarily in Argentina’s favour regarding anti-dumping measures imposed by the EU on Argentine biodiesel exports to the EU. Inter alia, the panel found that the EU had contravened the Anti-dumping Agreement and the GATT 1994 by failing to calculate the cost of production of the product on the basis of the records kept by Argentine producers, and by imposing anti-dumping duties in excess of the margins of dumping that should have been established per the Anti-dumping Agreement and the GATT 1994.

Background

The dispute (DS473) European Union – Anti-dumping Measures on Biodiesel from Argentina surrounds two EU measures regarding biodiesel imports from Argentina and Indonesia, namely:

  • Article 2(5), second subparagraph, of Council Regulation (EC) No. 1225/2009 of 30 November 2009 on protection against dumped imports from countries not members of the European Community (the Basic Regulation)
  • Anti-dumping measures imposed by the European Union on imports of biodiesel originating in Argentina and Indonesia.

The EU’s anti-dumping measures were implemented following an investigation by the European Commission after the European Biodiesel Board (EBB), which represents the interests of EU biodiesel producers, lodged a complaint on July 17, 2012, for anti-dumping against biodiesel imports from Argentina and Indonesia. The  EBB has argued that Argentine and Indonesian biodiesel producers were selling biodiesel at artificially low prices in the EU market thereby putting the EU biodiesel industry at a disadvantage, compromising jobs in the industry and the industry’s ability to contribute to sustainable green transport in the EU.

In January 2013, the Commission made Argentine and Indonesian biodiesel imports in the EU subject to registration. Following its investigation, the Commission imposed provisional anti-dumping duties on May 29, 2013 and definitive anti-dumping duties on 27 November 2013. In the Definitive Regulation No 1194/2013, it was calculated that the injury margins ranged from 41.9% to 49.5% . The EU applied anti-dumping duties of 22.0% to 25.7% which took the form of specific duties expressed as a fixed amount in euro/tonne.

Argentina, one of the world’s largest exporters of biodiesel, argued that the EU’s measures were protectionist and aimed at protecting inefficient European biodiesel producers. It has been reported in Argentine media that the measures are estimated to have cost Argentina almost the equivalent of 1,600 million dollars worth in biodiesel exports annually.

The Dispute

In December 2013, Argentina requested consultations with the EU and requested that a panel be established in March 2014. A panel was established in April 2014.

Argentina based its claims on various articles of the Anti-Dumping Agreement, the General Agreement on Tariffs and Trade (GATT) 1994 and the WTO Agreement, arguing that “as applied” the EU’s measures were inconsistent with various articles of these agreements. Argentina also asked the Panel to find that Article 2(5), second subparagraph of the Basic Regulation was  “as such” inconsistent with Articles 2.2, 2.2.1.1 and 18.4 of the Anti-Dumping Agreement, Article VI:1(b)(ii) of the GATT 1994, and Article XVI:4 of the WTO Agreement.

“As such inconsistent”, basically means that the measure is inconsistent in and of itself and is not solely inconsistent because of its application in a specific instance. “As such” challenges are therefore “serious challenges” as noted by the Appellate Body in US – Oil Country Tubular Goods Sunset Reviews particularly given the presumption that WTO Members act in good faith in the implementation of their WTO commitments.

Additionally, the ruling’s contribution to the WTO’s body of jurisprudence should not be overlooked. As noted by the panel, Argentina’s claims “raise[d] complex questions pertaining to the interpretation of Articles 2.2 and 2.2.1.1 of the Anti-Dumping Agreement and Article VI:1(b)(ii) of the GATT 1994 that have not been addressed previously by panels or the Appellate Body”.

Ruling

In its panel report released yesterday (March 29), the panel found in favour of most of Argentina’s complaints. However, the Panel found that Argentina did not establish that Article 2(5), second subparagraph of the Basic Regulation was “as such” inconsistent with Articles 2.2.1.1 and 2.2 of the Anti-Dumping Agreement and Article VI:1(b)(ii) of the GATT 1994.The Panel also rejected  Argentina’s claim that the amount for profits established by the EU authorities (15% on turnover) was not based on a reasonable method  within the meaning of Article 2.2.2(iii) and also rejected Argentina’s claim that the EU had failed to meet the “fair comparison” requirement under Article 2.4 of the Anti-Dumping Agreement.

However, the Panel did find in Argentina’s favour on several key issues. Argentina claimed that the EU had failed to calculate the cost of production of biodiesel on the basis of the records kept by the producers/exporter under investigation and had therefore acted inconsistently with Article 2.2.1.1 of the Anti-dumping Agreement.

Article 2.2.1.1. of the Anti-dumping Agreement provides that:

For the purpose of paragraph 2, costs shall normally be calculated on the basis of records kept by the exporter or producer under investigation, provided that such records are in accordance with the generally accepted accounting principles of the exporting country and reasonably reflect the costs associated with the production and sale of the product under consideration.

One of the issues the Panel had to consider was whether an investigating authority’s belief that a producer/exporter’s records reflect costs that are artificially low due to an alleged distortion constitutes a legally sufficient ground under Article 2.2.1.1. for that authority to find that a producer/exporter’s records do not “reasonably reflect the costs associated with the production and sale of the product under consideration”.

The EU authorities had argued that Argentina’s Differential Export Tax had artificially depressed the domestic price of soybeans and soybean oil (the inputs for Argentina’s biodiesel) and had distorted Argentine producers’ production costs.  They argued that this cost distortion should be taken into account in constructing Argentine producers’ normal value and chose  to rely on the average reference price of soybeans published by the Argentine Ministry of Agriculture for export as opposed to the actual price for soybeans reported in the Argentine producers/exporters’ records.

The panel found that the EU’s argument for ignoring the producers’ costs  did not constitute a legally sufficient basis  for arguing that the producers’ records do not reasonably reflect the producers’ costs as required per Article 2.2.1.1 of the Anti-dumping Agreement.Because of its ruling on Article 2.2.1.1, the Panel did not see it necessary to rule on whether as a consequence, the EU had acted inconsistently with Article 2.2 of the Anti-Dumping Agreement and Article VI:1(b)(ii) of the GATT 1994 in this regard.

The Panel also found that the EU did not use a cost that was the cost prevailing in the country of origin (i.e. Argentina) in the construction of the normal value and had therefore acted inconsistently with Article 2.2 of the Anti-Dumping Agreement and Article VI:1(b)(ii) of the GATT 1994.

The Panel ruling also supported Argentina’s claim that the EU had imposed anti-dumping duties in excess of the margin of dumping per Article 2 of the Anti dumping argument and had therefore also acted inconsistently with Article 9.3 of the Anti-Dumping Agreement and Article VI:2 of the GATT 1994.

The Panel upheld Argentina’s claim finding that as it relates to production capacity and capacity utilisation, the EU had acted inconsistently with Articles 3.1 and 3.4 of the Anti-Dumping Agreement. However, the Panel ruled that Argentina’s claims with respect to the EU authorities’ evaluation of return on investments fell outside of the Panel’s terms of reference.

The Panel concluded that “to the extent that the measures at issue have been
found to be inconsistent with the Anti-Dumping Agreement and the GATT 1994, they have nullified or impaired benefits accruing to Argentina under these agreements”. Pursuant to Article 19.1 of the DSU, the Panel recommended that the EU bring its measures into conformity with its obligations under the Anti-Dumping Agreement and the GATT 1994.

Both parties have 60 days in which to file an appeal against the panel’s decision.

Indonesia, which was also affected by these EU measures, was one of the third parties to this dispute. Indonesia also currently has a dispute pending against the EU on this matter (DS480 :  EU – Anti-dumping measures on biodiesels from Indonesia).

A summary of the panel report and  the full panel report may be accessed on the WTO’s website here.

Alicia Nicholls, B.Sc., M.Sc., LL.B. is a trade and development consultant with a keen interest in sustainable development, international law and trade. You can also read more of her commentaries and follow her on Twitter @LicyLaw.

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Summary Report of Public Consultation on Future of ACP-EU Relations Released

Alicia Nicholls

The African, Caribbean and Pacific (ACP) Group and the European Union (EU) are currently in a period of reflection on the future and form of ACP-EU cooperation post the expiration of the Cotonou Partnership Agreement (CPA) in 2020. The EU launched a public consultation “Towards a New Partnership between the EU and the ACP Countries after 2020” which took place between 6 October to 31 December 2015. Last Monday, the European Commission released its summary report of this public consultation.

A wide variety of stakeholders submitted responses, including the ACP Young Professionals Network whose response may be viewed here. Public authorities/ international organisations was the largest category of shareholder which sent responses, followed by civil society organisations.

As part of the ACP group, CARIFORUM countries have enjoyed a privileged relationship with the EU for the past four decades. The EU is a major trade, investment and development partner for CARIFORUM countries and it is in the region’s best interest to ensure that any new framework for EU-ACP engagement takes into account the region’s interests and concerns.

It is therefore quite unfortunate that there was such poor representation of CARIFORUM stakeholders among those which submitted responses as part of the joint consultation. Of the 103 responses received, only one came from a stakeholder within a CARIFORUM state – Jamaica.  The overwhelming majority of non-EU responses were from entities based in African countries.

Key points from the Summary Report

It was noted in the summary report that the major problem highlighted by respondents was “the difficulty to attribute progress or lack thereof specifically to the CPA framework or to EU policy as a whole”.
Some of the other key points noted in the summary report are that:
  • Respondents were generally of the opinion that the Cotonou Partnership has had a positive contribution to human and social development, including poverty reduction. However, opinions seem divided on its contribution towards sustainable and inclusive economic development.
  • Respondents, however, had a more critical opinion of the CPA’s effectiveness with respect to several other areas, including private sector development and foreign direct investment.
  • Implementation of the Sustainable Development Goals (SDGs) was the main priority put forward in regards to the future of joint ACP-EU relations, with private sector development, improved business environment and business promotion being identified as priorities in the framework of sustainable and inclusive economic growth.
  • With respect to the future form of ACP-EU collaboration, a large majority of respondents favoured a stronger role for civil society actors and the private sector.
The full summary report may be accessed here.
Alicia Nicholls, B.Sc., M.Sc., LL.B. is a trade and development consultant with a keen interest in sustainable development, international law and trade. You can also read more of her commentaries and follow her on Twitter @LicyLaw.

US President Obama lands in Cuba; US hotel to open in Cuba

Alicia Nicholls

According to a CNN news report, United States President Barack Obama landed in Cuba on Sunday. President Obama’s three-day visit to Cuba marks the first time in more than eighty years that a sitting US president has stepped foot on Cuban soil. The US president, who is accompanied by first lady Michelle Obama and daughters Malia and Sasha, was greeted upon arrival by top Cuban officials.

In related news US hotel chain Starwood has reached an agreement to open the first US hotel in Cuba since the embargo. According to this BBC report, Starwood will renovate and operate three hotels in Havana.

Rapprochement

President Obama’s visit is the latest in a series of steps taken by his administration since December 2014 towards normalising relations between the US and Cuba. These steps have involved the progressive removal of some travel and trade restrictions and include:

  • Allowing individual travel by US citizens to Cuba for educational “people to people” purposes, although a general travel ban remains in effect
  • Approval of a ferry service between the US and Cuba
  • Allowing US bank accounts for Cuban nationals
  • Re-opening of US embassy in Havana
  • Lifting of restrictions on export financing
  • Agreement to resume commercial air links between the US and Cuba. Several US airlines have already signed up.

A full list of the restrictions eased are available in a press release issued by the US Treasury and Commerce Departments.

However, despite the President’s calls for congress to lift the decades-old embargo, it remains.

More will be posted as the story develops.

Alicia Nicholls, B.Sc., M.Sc., LL.B. is a trade and development consultant with a keen interest in sustainable development, international law and trade. You can also read more of her commentaries and follow her on Twitter @LicyLaw.

Caribbean Weekly Trade & Development Digest – March 6-12, 2016

These are some of the major trade and development headlines and analysis across the Caribbean region and the world for the week of March 6-12, 2016:

Regional

CARIFORUM Ministers to meet in Guyana

Antigua Observer: Issues relating to the 10th and 11th European Development Fund (EDF) will be among matters discussed here when the Council of Ministers of the Caribbean Forum of African, Caribbean and Pacific States (CARIFORUM) meets here next week. Read more

Cuba upward tourism trend not slowing

Caribbean News Now: Despite forecasts of the possibility of Cuban tourism failing to keep the upward trend shown in the last years, the Caribbean island’s leisure industry posted 14.6 percent growth in the first 71 days of 2016. Read more

CARICOM seeking support from Portugal on tax issues

Jamaica Observer: The Caribbean Community (Caricom) is calling on Portugal to help remove a number of Caribbean countries from a list of non-cooperative tax jurisdictions developed by the European Union. Read more

Customs officers get training under CARIFORUM-EU Pact

Stabroek: Several local customs officers, as well as stakeholders in the public and private sector benefitted from a customs and trade facilitation capacity workshop, at the Guyana Revenue Authority (GRA), GINA said. Read more

What TPP means for Latin America and the Caribbean

Brookings Institute: An agreement of this size and scope will have important implications for Latin America and the Caribbean (LAC), and for the global trade architecture as a whole. Read more

Guyana – All Styrofoam imports banned from April

Barbados Today: Importation of styrofoam will no longer be allowed, effective April 1, with the Ministry of Finance considering tax incentives for importers who are interested in bringing in alternatives.Read more

St. Kitts & Nevis citizenship fund releases audited financial statements

Caribbean360:The St Kitts and Nevis Sugar Industry Diversification Foundation (SIDF) has released audited financial statements for 2012 and 2013. Read more

IMF Team Concludes Consultation with Guyana

Caribbean News Now: A staff team from the International Monetary Fund (IMF), led by Marcos Chamon, visited Guyana during February 24–March 7 to hold discussions for the 2016 Article IV consultation. Read more

International

WTO Issues Panel Report regarding US duties on Korea washers

WTO: On 11 March 2016, the WTO issued the panel report in the case brought by Korea regarding “United States — Anti-dumping and Countervailing Measures on large residential washers from Korea” (WT/DS/464).Read more

WTO farm talks chair: subsidies key to 2017 outcome

ICTSD: Addressing farm subsidies could be “key” to a negotiating outcome next year on global trade, the chair of the WTO’s farm  talks said on Tuesday, as two prominent Indian experts hit back at a critique of the country’s negotiating stance on agriculture. Read more

WTO members look at way forward in agriculture talks

WTO: WTO members considered the way forward in agriculture talks at the first informal meeting of agriculture negotiations after the WTO Nairobi Ministerial Conference on 8 March. Read more

Theme of 2016 WTO Public Forum to be “Inclusive Trade”

WTO: The theme of the 2016 Public Forum, to be held at the WTO’s headquarters in Geneva on 27-29 September, is “Inclusive Trade”. Read more

Brexit and Britain: What would it mean for UK trade?

Reuters: The stakes will be high for Britain’s historic role as a free-trading nation when it holds a referendum on whether to stay in the European Union on June 23. Read more

Australia, Indonesia in free trade talks

SkyNews: Indonesia and Australia hope free trade talks this week can help turn around ‘underdone’ business and investment ties. Read more
Eurativ: A new legal world is emerging around the EU’s trade policy. Scrutiny over the compatibility of trade agreements with human rights is increasing under recent Ombudsman and Court of Justice moves regarding the new trade agreement with Vietnam, and a 2012 agriculture agreement with Morocco. Read more

Recent Articles on Caribbean Trade Law & Development Blog

For past issues, please visit here.

Alicia Nicholls, B.Sc., M.Sc., LL.B. is a trade and development consultant with a keen interest in sustainable development, international law and trade. You can also read more of her commentaries and follow her on Twitter @LicyLaw.

Good Governance, the SDGs and Caribbean SIDS

Alicia Nicholls

Caribbean countries joined fellow United Nations Member countries in September 2015 in endorsing the 17 Sustainable Development Goals (SDGs) and their 169 targets which reflect the ambitions and aspirations for the 2030 global Agenda for Development. Good governance (SDG 16) is a standalone goal under the post-2015 global development agenda, but is considered an “enabler” goal, as enhancing institutional structures and governance can assist in the implementation and monitoring of progress towards achieving the other SDGs.

Commonwealth Caribbean countries take pride in their British-inherited Westminster/Whitehall systems of government, political stability and smooth transitions of power. However, governance reform has been a consistent feature of the political discourse across the region and it is useful to consider what role can good governance play in Caribbean small island developing states’ (SIDS) achievement of the post 2015 global development agenda.

The relationship between good governance and development is one which has dominated the development literature; a central debate in the academic literature is whether good governance is a prerequisite/enabler for, or consequence of, development. In July 2012, UN Member States unequivocally agreed pursuant to UN General Assembly Resolution 66/228 of July 2012 that good governance and rule of law are essential for sustainable development.

The United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) defines good governance as “the process of decision-making and the process by which decisions are implemented (or not implemented)”. UNESCAP goes on to state that good governance “is participatory, consensus oriented, accountable, transparent, responsive, effective and efficient, equitable and inclusive and follows the rule of law”. Besides good governance, the development literature has identified two other components of governance: equitable and effective governance.

SDG -16 (Good governance and rule of law)

The UN High Level Panel of Eminent Persons opined that good governance should be a standalone goal as opposed to integrated into the other goals. This is enshrined in SDG16 which is to “promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels”. SDG 16 therefore includes not just good governance but the rule of law.

SDG16’s 12 targets are broad based, ranging from the reduction of violence and an end to human trafficking, promoting the rule of law, reducing illicit financial and arms flows, among other things. Those specific to governance are to substantially reduce corruption and bribery in all their forms, develop effective, accountable and transparent institutions at all levels, ensure responsive, inclusive, participatory and representative decision-making at all levels, and strengthen the participation of developing countries in the institutions of global governance, provide legal identity for all, ensure public access to information and protect fundamental freedoms, in accordance with national legislation and international agreements, strengthen relevant national institutions, including through international cooperation and promoting and enforcing non-discriminatory laws and policies for sustainable development.

Governance in the Caribbean Region

With few exceptions in history, we in the Commonwealth Caribbean have had peaceful transitions of power and are generally societies anchored by respect for the rule of law. Our constitutions contain bills of rights which enshrine important rights and freedoms for our citizenry, with limitations. Notwithstanding this, there are concerns about some aspects of our systems, particularly in regards to transparency, accountability, government responsiveness and citizen engagement. Moreover, many wonder how democratic are our systems outside of the periodic opportunity to vote for a new government.

In regards to press freedom, Caribbean countries do quite well on the Reporters without Borders’ World Press Freedom Index 2015: Jamaica (9), Suriname (29), Eastern Caribbean (37), Trinidad & Tobago (41), Haiti (53). Barbados was not included. In contrast, of the few Caribbean countries included in the Transparency International’s Corruption Perceptions Index 2015, none is included in the top 50. Cuba is ranked 52, Jamaica (69), Trinidad & Tobago (72), Suriname (88), Dominican Republic (103), Guyana (119), Haiti (158). This trails behind other SIDS like Cape Verde and Seychelles (40), Mauritius (45) and Sao Tome e Principle (66). Barbados ranked 17 in 2014 but was not included in the 2015 index.

Trinidad & Tobago was the first Commonwealth Caribbean country to implement freedom of information legislation in 1999. Antigua & Barbuda, Jamaica, Belize, St. Vincent & the Grenadines, Dominican Republic, Guyana, the Bahamas, Cayman Islands all have FOI laws with various levels of efficacy. Barbados, however, remains one of the few Caribbean countries not to have Freedom of Information legislation and despite promises by the political directorate, does not have integrity legislation. On the Global Open Data Index Barbados ranked 109 out of a 122 countries. The availability of official government data and regular reporting and information sharing by government agencies still leave a lot to be desired.

While it may be tempting and politically expedient for our governments to pick and choose which rankings they wish to believe, several issues are symptomatic of governance failings in the region and of the feeling by our electorates that the quality of governance in our countries leaves a lot to be desired. These include low voter turnouts as seen in Jamaica’s recent general election and allegations of vote buying in Barbados’ elections in 2013. Across the Caribbean one can find examples of corruption scandals, accusations of political victimisation and media censorship, allegations of nepotism and of the awarding of questionable contracts. To fill the void, citizens are turning ever increasingly to social media to air their views and to expose alleged cases of corruption.

Governance for sustainable development

So how can improving the governance systems in the Caribbean assist our little countries in their progress towards achieving the SDGs? The achievement of many of the SDGs requires governance institutions which are strong, well-functioning and well-resourced. For example, well-managed and staffed Town Planning departments and the implementation and enforcement of town planning policies and regulations have a role to play making cities and human settlements inclusive, safe, resilient and sustainable (SDG 11). Social welfare institutions are needed to reduce inequality within and among countries (SDG 10). Efficient water management policies and strategies are needed to ensure availability and sustainable management of water and sanitation for all (SDG 6). Governance reforms must involve strengthening institutions to assist in the high quality provision of services such as health care and education for the most vulnerable groups in society, which in turn helps to reduce poverty and inequality.

Good governance, embodied by governance that is “participatory, consensus oriented, accountable, transparent, responsive, effective and efficient, equitable and inclusive and follows the rule of law”, inspires confidence and participation in the system by the citizenry, civil society and the private sector. A more responsive and participatory governance structure allows for special interest populations such as the youth, the disabled and others greater voice.

Key to citizen participation is access to accurate and timely information. Access to information allows scrutiny of policies by citizens and helps them hold elected officials accountable. Improving communication channels between the government and citizenry allows for the flow of information and ideas between the government and governed, between the government, private sector and civil society, which are essential for policy creation, evaluation and modification, where necessary. Participatory government helps to re-orient policies towards the needs of the community, allowing for greater public support for policies.

In regards to SDG 8 (promoting sustained, inclusive and sustainable economic growth, full and productive employment, and decent work for all), responsive governance institutions allow for ease of doing business which facilitates private sector activity. The private sector has been identified by the global community as a critical partner for the implementation of the SDGs, not just in terms of providing financing for development, but by aligning their policies to help meet these goals, including the adoption of more environmentally sustainable business, production and investment practices, providing more opportunities for women’s participation and engaging in greater involvement in the community. However, what businesses need is a facilitating and not prohibitive regulatory environment. What they also need is confidence that government decisions will be made based on objective criteria and not on patronage.

The way forward

Good governance is essential for helping Caribbean countries in their pursuit of the SDGs. Corruption is a cancer which results in weak and selective enforcement of laws, lack of accountability and transparency, all of which have negative implications for sustainable development. Large informal economies make it difficult for governments to mobilise domestic resources for financing for development, while distrust of government officials makes the private sector less willing to invest or engage in public-private partnerships. These are issues which Caribbean countries must tackle in their pursuit of the SDGs.

Another issue will be measuring progress made towards achievement of SDG16’s targets. In the Caribbean official data tends to be scarce. This is evidenced by the frequent absence of some Caribbean countries from international indices due to lack of data. Addressing these data shortages will be needed for monitoring.

Alicia Nicholls, B.Sc., M.Sc., LL.B. is a trade and development consultant with a keen interest in sustainable development, international law and trade. You can also read more of her commentaries and follow her on Twitter @LicyLaw.

Caribbean Weekly Trade & Development Digest – February 28 – March 5 2016

These are some of the major trade and development headlines and analysis across the Caribbean region and the world for the week of February 28- March 5, 2016 :

Regional

Biofuel Manufacturer to invest US$95 million in Jamaica plant by 2017

South Florida Caribbean News: As renewable energy demands increase globally, biofuel developer Benchmark Renewable Energy LLC has officially announced plans to develop a large scale bio-ethanol operation in Jamaica. Read more

Barbados passport tops Caribbean passports in ease of visa-free travel

Caribbean Trade Law & Development: Barbados has the best passport among Caribbean countries. This is according to Henley & Partners’ recently published Visa Restrictions Index 2016 in which Barbados has topped Caribbean countries in the ease of which its citizens/passport holders can cross international borders. Read more

US airlines sign up for commercial flights to Cuba

CNN Money: American Airlines, Alaska Airlines, Delta Air Lines, Southwest Airlines, United Airlines and JetBlue have all submitted applications to the U.S. government to fly commercial flights to Cuba. Read more

T&T facing downgrade by Moody’s Investors

Trinidad Express: For the second time in two years, Trinidad and Tobago is facing a downgrade by international credit ratings agency Moody’s Investors Service. Read more

Strike hits Guyana’s sugar industry

Caribbean360: A day after declaring that Guyana’s first crop sugar target was on track to be met, the Guyana Sugar Corporation (GuySuCo) has been hit by strike action. Read more

Barbados & St. Lucia Negotiating Agreement

CARICOM Today: The Governments of Barbados and St. Lucia have decided to proceed to the negotiation and conclusion of an agreement establishing the maritime boundary between the two States. Officials from the two States met in Barbados from March 1 to 4, 2016 and prepared the draft text of a maritime boundary delimitation agreement. Read more

International

India files dispute against the US over non-immigrant temporary working visas

WTO: On 3 March 2016, India notified the WTO Secretariat that it has initiated a WTO dispute proceeding against the United States regarding measures imposing increased fees on certain applicants for two categories of non-immigrant temporary working visas into the US, and measures relating to numerical commitments for some visas.  Read more

Commodity prices signal market bottom

Financial Times: When news of the highest crude stocks since the Great Depression hit oil traders’ screens on Wednesday, those expecting another rush of sell orders were in for a surprise. Read more

Paraguay becomes second South American nation to ratify the Trade Facilitation Agreement

WTO: Paraguay has become the second South American nation to ratify the WTO’s new Trade Facilitation Agreement (TFA). Eladio Loizaga, Paraguay’s Minister of Foreign Affairs, presented his country’s instrument of acceptance to WTO Deputy Director-General Yi Xiaozhun on 1 March. Read more

EU, Canada Revise Investment Protections in Trade Deal

ICTSD: The EU and Canada announced on Monday that they have revised the investment protection terms in their bilateral trade pact, with the new version now including an investment court system that Brussels is hoping to pursue in other trade agreements – including with the US. Read more

Barclays Africa ‘s trade finance future uncertain

Global Trade Review: Barclays Africa’s trade and export finance future will be in the hands of the bank’s next majority shareholder after Barclays reduces its 62.3% stake to around 20% over the next two to three years. Read more

US Imposes 266 percent tariffs on some Chinese steel imports

Wall Street Journal: The Department of Commerce Tuesday imposed preliminary duties on imports of cold-rolled steel, used to make auto parts, appliances and shipping containers, from seven countries including China, whose steelmakers were slapped with a massive tariff. Read more

Recent Articles: Caribbean Trade Law & Development Blog

US President Obama’s Trade Agenda – 2016

Barbados’ Passport Tops Caribbean Passports in Ease of Visa-free Travel

For past issues, please visit here.

Alicia Nicholls, B.Sc., M.Sc., LL.B. is a trade and development consultant with a keen interest in sustainable development, international law and trade. You can also read more of her commentaries and follow her on Twitter @LicyLaw.

US President Obama’s Trade Agenda 2016

Alicia Nicholls

The Office of the United States Trade Representative (USTR) has released President Obama’s Trade Policy Agenda for 2016 with the theme of “Trade that serves the American People”.

As expected in an election year and the President’s final term, the agenda document mentions some of the accomplishments of the President’s trade agenda over his two-terms, including the conclusion of free trade agreements with Korea, Colombia and Panama, the signing of the Trans-Pacific Partnership Agreement, the bringing of 20 enforcement cases in the World Trade Organisation (WTO), renewing the Generalised System of Preferences (GSP) and the Africa Growth & Opportunity Act (AGOA) and “rejuvenating the WTO negotiation process”.

According to the preface to the document by current USTR, Michael Froman, the President’s 2016 agenda is centred on promoting growth, supporting well-paying jobs in the US and strengthening the middle class. To this effect, a central thrust of the Agenda will be continuing work towards achieving the removal of foreign taxes on US exports and enforcing US trade rights.

To further these goals, the administration in its remaining time has committed itself to continue its negotiation of free trade agreements which help promote jobs  for Americans and opportunities for US exporters. Mention was made of the on-going negotiations with the European Union on the Trans-Atlantic Trade and Investment Partnership (T-TIP) and deepening its relationship with Brazil through the Agreement on Trade and Economic Cooperation (ATEC). At the plurilateral level, there is commitment to conclude the Environmental Goods Agreement and the Trade in Services Agreement.

So where does the Caribbean feature in all of this? It should be noted that in the document, the Caribbean was mentioned a grand total of only twice. The document made reference to the Caribbean Basin Initiative, the US’ only permanent preference programme, and also noted that in 2016, the US  will continue its engagement with the region to encourage even greater trade and investment”.

It signals the US’ commitment towards preserving the preferential access Caribbean countries enjoy under the CBI for many of their merchandise exports. However, it also makes clear that the Region does not enjoy any real priority in Washington’s trade agenda. In contrast for example, the report notes that the US will “intensify engagement with trading partners in sub-Saharan Africa to advance key trade and investment initiatives” as US companies continue to see opportunities in Africa.

In regards to Cuba, the President’s agenda states as follows:

“Within the parameters for the new relationship with Cuba set by the Administration and the existing embargo, we will work in the WTO and bilaterally to explore ways to deepen our trading relationship with Cuba, and if conditions are right, advance the normalization of U.S.-Cuba trade relations.”

While the current agenda reaffirms the embargo, it does hint at normalisation “if conditions are right”, whatever those right conditions are.

In terms of the US’ multilateral engagements at the World Trade Organisation (WTO), the document confirms once and for all that Doha is dead as far as the US is concerned:

“In 2016, WTO members have an opportunity to undertake new approaches to longstanding issues and take up new issues without being constrained by the strictures of the Doha Round architecture.”

Instead, the President in his 2016 agenda has committed to “advancing a new form of pragmatic multilateralism that will tackle emerging issues important to developing and developed economies alike.” The agenda also states the US’ commitment to assisting the integration of Least Developed Countries into the global economy.

It is an election year in the US with its infamous “lameduck period” which brings uncertainty about how much of the Agenda the President will actually be able to achieve in his remaining time in office. The Trans-Pacific Partnership Agreement (TPP), which is a “central part of the President’s broader economic strategy”, has received major resistance and opposition both in the US congress, among the general public and some presidential candidates. As expected, the President, therefore, has a major fight on his hands to obtain Congressional approval of the TPP before he leaves office. There is no guarantee his successor will support it.

The full report may be accessed here.

Alicia Nicholls, B.Sc., M.Sc., LL.B. is a trade and development consultant with a keen interest in sustainable development, international law and trade. You can also read more of her commentaries and follow her on Twitter @LicyLaw.

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