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Caribbean Trade & Development Digest – February 10-16, 2019

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Welcome to the Caribbean Trade & Development Digest for the week of February 10-16, 2019! We are happy to bring you the major trade and development headlines and analysis from across the Caribbean Region and the world from the past week.

THIS WEEK’S HIGHLIGHTS

Nine countries, including the US, Russia and the EU, approved an international agreement banning commercial vessels from fishing in the Arctic Sea for sixteen years in an effort to preserve the environment of the Arctic Sea.

The US-China trade talks continued this week. Meanwhile, US President Trump may possibly be considering an extension to the 90-day truce agreed by the two behemoths in December 2018, which is supposed to end March 1.

With Brexit only a month or so away,  UK Prime Minister Theresa May suffered yet another defeat in parliament when MPs voted 303 to 258 against endorsing her government’s Brexit negotiating strategy. While not binding, it is a further sign of declining confidence in the May Government’s handling of Brexit.

Turning regionally, IMF Deputy Managing Director Tao Zhang gave a speech in Grenada entitled “Building Resilience to Natural Disasters and Climate Change in Grenada and the Caribbean”. Have a read here.

REGIONAL

T&T Ministry working with USDA to stop inferior chicken imports

LoopTT: Government is now working with the US Department of Agriculture to stop the importation old, inferior chicken into Trinidad and Tobago, after reports that old, substandard chicken was being sold locally.  Read more 

Guyana: No foreign exchange shortage but fewer US notes in circulation

Demerara Waves: The Governor of the Bank of Guyana, Dr. Gobin Ganga, has assured that there is no shortage of foreign currency to transact international business such as wire transfers, but there are fewer United States (US) notes circulating at cambios and commercial banks partly because the increasing number of foreign workers are buying up the bills. Read more

Republic of China (Taiwan) donates to trade development in Belize

LoveFM: The Republic of China (Taiwan) is one of the country’s staunch allies that continues to contribute to Belize’s development. Their latest contribution comes in the form of sixty thousand US dollars earmarked for trade development. Read more 

BNSI proposes introduction of front-of-pack labelling standard 

Barbados Advocate: The Barbados National Standards Institution (BNSI) hosted a national consultation recently to get feedback from consumers on a new, compulsory standard they sought to introduce. Fabian Scott, Chief Technical Officer at the BNSI, explained that they were seeking to update the current requirements for the food labelling standard. Read more 

Jamaica Government to Leverage New Opportunities in Partner Countries to Support Trade

JIS: The Government, through the Ministry of Foreign Affairs and Foreign Trade, will work assiduously to leverage new opportunities in both traditional and non-traditional partner countries to support trade, investment and technical cooperation pursuits. Read more 

Caribbean tourism on the upswing

CTO: The Caribbean tourism sector is projected to record strong growth in 2019 on the heels of a stronger-than-expected performance last year. Read more 

Major oil find excites southern Caribbean

Amsterdam News: U.S. supermajor ExxonMobil announced two major oil finds offshore Guyana in the past week, and the discovery has raised the hopes for similar massive oil discoveries in two of its neighbors that incidentally already produce oil and gas. Read more 

Spotlight on Statistics Strategy – PM Mitchell to address High Level Forum in Grenada next week

CARICOM: A High Level Advocacy Forum on Statistics will be held next week as the Region continues to place more emphasis on the production and use of quality statistics. Read more

Youth Bridge Gap Between Climate Change, Climate Awareness in Guyana

CARICOM: A group of youngsters in the Caribbean who promote environmental protection in the region is on a drive to empower other youth to address some of the big issues facing their generation. Read more 

Guyanese American Chamber of Commerce Recommends Extension of CBERA

South Florida Morning News: The Guyanese American Chamber of Commerce (GCAA) wishes to draw to the attention of the  business community in the United States and Guyana the fact that the Caribbean Basin Economic Recovery Act (CBERA) will expire on September 30, 2020 and to urge the private sector at home and in the US, as well as the Government of Guyana in collaboration with its CARICOM partners to embark on efforts to ensure that this Act is extended by the US Congress for at least another 10 years. Read more

Guyana denies shipping ‘bad’ rice to Jamaica

TV6 T&T: Guyana says it has not shipped any rice to Jamaica under the “Cinderella” brand for the year after media reports in Kingston said that 70 metric tonnes of White Cinderella rice, had been confiscated by Jamaican authorities. Read more

Jamaica confiscates 70 tonnes of Guyanese rice

Demerara Waves: The Food Storage and Prevention of Infestation Division (FSPID), in the Ministry of Industry, Commerce, Agriculture and Fisheries (MICAF) says it has confiscated 70 metric tonnes (1,575 bags) of White Cinderella rice from Guyana due to high microbial content. Read more

INTERNATIONAL

US, Canada accuse India of underreporting support for lentils, chickpeas; approach WTO 

Economic Times: The United States and Canada have moved the World Trade Organization (WTO) accusing India of underreporting its market price support for five pulses. Read more 

Tariffs Take Toll On American Whisky Exports

Jamaica Gleaner: Retaliatory tariffs caused a sharp downturn in American whisky exports in the last half of 2018 as distillers started feeling the pain from global trade disputes, an industry trade group said Tuesday. Read more 

German discounters’ banana tactics irk Ecuador

Deutsche Welle: Ecuador is the world’s largest exporter of bananas. The fruit plays just as big a role as oil for the country’s economy and its fight against poverty. Some German discounters seem to care little about that. Read more 

Indian Commerce ministry to notify WTO regarding revoking MFN status to Pakistan

Economic Times: The commerce ministry would soon notify to the World Trade Organization (WTO) its decision to revoke the most-favoured nation (MFN) status to Pakistan on security grounds, an official said Friday. Read more 

Record EU Trade Surplus With U.S. Could Put Trump Truce at Risk

Bloomberg: The European Union’s trade surplus with the the U.S. jumped 17 percent last year to the highest on record, potentially putting at risk ongoing negotiations just as President Donald Trump is gearing up to decide whether to hit the 28-nation bloc with a new set of tariffs. Read more

European Commission welcomes European Parliament’s support for investment screening framework

EU: Following today’s vote, the EU is one step closer to putting in place a Europe-wide framework for screening foreign direct investment. Read more 

Commission puts in place duties on subsidised biodiesel from Argentina

EU: Today, the Commission imposed definitive anti-subsidy measures on imports of biodiesel from Argentina. In parallel, the Commission adopted a decision accepting sustainable price commitments (known as undertakings) from eight Argentine producers and the Argentinian Chamber of Biofuels (CARBIO) that will exempt the exporting producers from the duties within an agreed import limit. Read more 

Israel, Iran to join Russian-led free trade agreement

JNS: However, the two nations will sign their own free-trade accord with the bloc, meaning the adversaries could not trade freely with one another. Read more 

U.S. drafts WTO reform to halt handouts for big and rich states

Reuters: The United States proposed a reform of the World Trade Organization on Friday that would slash the number of countries that are eligible for “special and differential treatment”, a plan likely to be resisted by China, India and other countries. Read more 

New treaty bans commercial fishing in the Arctic for 16 years

Euractiv: The European Union and nine other countries, including the US and Russia, approved an international agreement on Thursday (14 February) that will prohibit commercial vessels from fishing in the Arctic in order to preserve the region’s fragile ecosystem. Read more 

The EU’s Dirty Money Blacklist: North Korea, Syria, and… Puerto Rico?

Foreign Policy: The U.S. Treasury Department scolded the European Union for including U.S. territories on a list of dirty money hotspots around the world, telling American banks to ignore EU directives in an unusual technocratic spat that highlights continued friction between Washington and Brussels. Read more 

New Caledonia and Vanuatu sign free trade agreement

Radio New Zealand: The leaders of New Caledonia and Vanuatu have signed an agreement to free up trade for a range of products. It will apply to about 50 products, with Vanuatu being able to export agricultural products including coffee without duties or quantity restrictions. Read more 

No-deal Brexit: UK exporters risk being locked out of world’s harbours

The Guardian: British exporters sending goods to far-flung destinations in the coming days risk being locked out of harbours around the world as a no-deal Brexit looms, business leaders have warned. Read more 

US-China trade talks break up without a deal

BBC: Trade talks between the US and China have broken up without a deal, with the US warning that “very difficult issues” remain unresolved. The talks in China this week were aimed at securing a new deal before further US tariffs are imposed on 1 March. Read more

Australia-Indonesia free trade agreement to be signed before election

Australian Financial Review: The on again, off again free trade deal between Australia and Indonesia has been salvaged after both governments said it would be signed in March, before both nations hold their federal elections. Read more 

EU-Singapore Free Trade Agreement Signed

ASEAN Briefing: On February 13, 2019, the European Parliament approved the EUSFTA by a majority vote. The stage is now set for the final ratification and entry into force of the trade pact between the two jurisdictions. Read more 

USMCA Coalition Formed during 116th Congress 

Global Trade Magazine: In an effort to support fastidious implementation of the United States-Mexico-Canada Agreement, a group consisting of trade associations, businesses, and other advocacy groups joined forces to create what is now known as the “Pass USMCA Coalition.” Read more

Canada won’t ratify new NAFTA until steel and aluminum tariffs lifted, warns key U.S. Senator

Financial Post: Canada and Mexico won’t consider ratifying the revised North American Free Trade Agreement unless the United States lifts its tariffs on steel and aluminum imports, U.S. Senator Chuck Grassley said Tuesday. Read more

WTO’s Potential Game-Changer: Global E-Commerce Rules? – Analysis

Eurasia Review: The recently launched WTO negotiations on e-commerce seeks to establish a new rulebook for e-commerce trade, and could be a potential game-changer for the global economy. Read more

Traditional Knowledge, Cheaper Drugs on India’s Agenda for the WTO

The Economic Times: India wants the World Trade Organization (WTO) to address issues related to exploitation of traditional knowledge, food security and access to affordable medicine going ahead. Read more 

WTO NEWS

DG Azevêdo in Mozambique: the trading system must support LDCs

WTO: Director-General Roberto Azevêdo was in Maputo, Mozambique, today (14 February), where he met President Filipe Nyusi. They discussed how to strengthen global trade cooperation for the future, through the WTO, so it can keep supporting the integration of Mozambique and other least developed countries (LDCs) into the global economy. Read more

Members discuss progress and assistance on Trade Facilitation Agreement’s 2nd year

WTO: WTO members took stock of progress in implementing the Trade Facilitation Agreement (TFA) at the 12-13 February meeting of the Committee on Trade Facilitation a week before the second anniversary of the Agreement’s entry into force. Members called for the timely fulfilment of commitments and discussed efforts to help each other carry out the Agreement. Read more

CLTD BLOG NEWS

Have a read of my latest article with Dr. Jan Yves Remy, Deputy Director of the University of the West Indies’ Shridath Ramphal Centre for International Trade Law, Policy & Services entitled “Can CARICOM Countries Afford to Miss the WTO E-Commerce Train”? published here.

The Caribbean Trade & Development Digest is a weekly trade news digest published by the Caribbean Trade Law & Development Blog. Liked this issue? To read past issues, please visit here. To receive these mailings directly to your inbox, please follow our blog.

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Can CARICOM Countries Afford to Miss the WTO E-commerce train?

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Dr. Jan Yves Remy and Alicia Nicholls

On the sidelines of this year’s World Economic Forum meeting in January at Davos, Switzerland, 76 Members of the World Trade Organization (WTO) expressed their intention to begin WTO negotiations on electronic commerce (e-commerce). Making up less than half of the WTO’s overall membership, these willing Members entreated other Members to join them in negotiating rules aimed at facilitating the use of e-commerce in trade.

All independent CARICOM Member States, with the exception of the Bahamas – which is presently acceding to the WTO – are WTO Members and therefore eligible to join these negotiations. However, so far none has done so. Given the potential of e-commerce for their development, should CARICOM Member States reconsider their cautionary stance?

Growing importance of e-commerce to global trade

E-commerce, also referred to as “digital trade”, has been defined as “the production, distribution, marketing, sale and delivery of goods and services through electronic and digital means”.  In its World Trade Report 2018, the WTO noted that digital technologies – such as artificial intelligence, blockchain, the Internet of Things and 3-D printing – are reducing trade costs and revolutionizing the structure and patterns of global trade flows.[i]  The United Nations Conference on Trade and Development (UNCTAD) estimated the global e-commerce market to be around US $22.1 trillion in 2015.[ii]

The WTO Report and numerous studies[iii] highlight the potential of e-commerce to catalyse economic transformation in developing countries by lowering trade costs, increasing market access opportunities for Micro, Small and Medium-Sized Enterprises and individual entrepreneurs, improving logistics, and widening consumer choice. Challenges, however, continue to plague the use of these technologies, including inadequate supportive policies, technology diffusion and regulation.

While more modern regional trade agreements – like the US-Mexico-Canada Agreement and even the CARIFORUM-EU Economic Partnership Agreement – include comprehensive digital trade chapters, the WTO, which was negotiated in 1995, still does not contain a multilateral agreement dealing holistically with e-commerce. Instead, separate disciplines affecting digital trade in goods and services can be found in the WTO’s General Agreement on Trade in Services, the General Agreement on Tariffs and Trade, the Agreement on Trade-Related Aspects of Intellectual Property Rights, and more recently, the Trade Facilitation Agreement.

The multilateral route: The WTO Declaration and Work Programme on E-Commerce

Multilateral discussions on e-commerce involving all WTO Members were launched in 1998 through the adoption of a Declaration on Global Electronic Commerce, and a Work Programme to examine trade-related issues related to global electronic commerce.  The Work Programme has been continuously updated at most WTO Ministerial Conferences since 1998, the last one being the Buenos Aires Ministerial Conference in 2017.  Under that Work Programme, the WTO’s main committees have been reviewing progress on discussions, with general oversight provided by the WTO’s General Council.  Despite fits of activity, and some proposals by select countries, not much has yet been accomplished beyond a temporary moratorium on the application of customs duties on electronic transmissions and the formulation of a working definition of e-commerce.

Although the negotiation of a multilateral agreement or rules among all 164 WTO Members would be ideal, consensus among all Members has been difficult to achieve.  This is in large part due to developing countries’ objections to what they consider to be ambitious proposals being pushed by developed countries.  On the one hand, WTO developing countries, led by India and the African Group of countries, support completion of the more limited mandate under the 1998 Work Programme framework.[iv]  On the other hand, developed countries, such as the US[v] and the European Union, advocate moving beyond mere discussions to actual negotiations to formulate rules aimed at increasing e-commerce opportunities in the twenty-first century.  Where CARICOM stands is unclear as no CARICOM government has to date tabled a proposal on e-commerce at the WTO.

The plurilateral route: Joint Statements on Electronic Commerce at Buenos Aires and at Davos

Without an official WTO mandate to proceed with multilateral negotiations, some WTO Members have begun negotiations on a plurilateral basis, that is, without all WTO Members but among a subset of willing ones.  The plurilateral discussions began when 71 Members signed a Joint Statement on E-Commerce in Buenos Aires in 2017, and was extended at Davos in January this year, when five more countries, including China, agreed to join the plurilaterals.

In their Joint Statement at Davos, the 76 signatories agreed, inter alia, to achieve “a high standard outcome that builds on existing WTO agreements and frameworks with the participation of as many WTO members as possible”.[vi]  The willing countries also agreed to “recognize and [to] take into account the unique opportunities and challenges faced by members, including developing countries and Least Developed Countries (LDCs), as well as by micro, small and medium sized enterprises, in relation to electronic commerce”.

Should CARICOM countries participate in plurilateral negotiations?

As with the multilateral e-commerce negotiations, CARICOM countries’ have remained silent on whether they have an appetite for joining the plurilateral e-commerce negotiations.  A number of factors could account for their apparent hesitation.

Firstly, CARICOM countries may be concerned about their capacity to engage in negotiations on an area of trade which is still relatively new and evolving, and their subsequent ability to implement in a timely manner any obligations undertaken. To allay such fears, it might be worth considering the approach to special and differential treatment taken in the Trade Facilitation Agreement, another WTO plurilateral agreement, where implementation is tied to a country’s capacity and the degree of technical assistance provided.

Secondly, some CARICOM countries may fear that participation in these negotiations will restrict their policy space, particularly their ability to regulate online traffic and cross border data flows, and attendant issues like data privacy and cybersecurity.  They might also be wary of the revenue implications of agreeing to the proposed permanent moratorium on the imposition of customs duties on electronic transmissions.

A third possible red flag for CARICOM may be the reluctance of other developing countries in joining the negotiations. While China joined at the last minute, others like India and the African Group countries have adamantly declined, preferring to focus attention on the multilateral discussions.[vii] These countries argue that e-commerce is monopolised by multinational corporations and that gains from e-commerce will not be realized for developing countries if they are required to cede their regulatory and policy space.

Without a critical mass of developing countries involved in the negotiations, CARICOM countries’ ability to form coalitions with perceived “like-minded” countries may be circumscribed. That said, e-commerce is an area in which CARICOM countries have offensive interests given the predominance of services in their economies.  It may well be that new coalitions will have to be built on the basis of a new alignment of interests.

Issues for Consideration

Given the importance of digital technology in global commerce, missing the e-commerce train at the WTO may not be in CARICOM’s best development interests. But CARICOM countries would be ill-advised to pursue a strategy to negotiations that ignores the following considerations.

Firstly, a negotiating strategy must be predicated on a sound digital trade policy that is informed by: data analysis of current patterns, scope and scale of e-commerce in the region; a clear-sighted appreciation of how e-commerce can promote the region’s overall economic transformation; and solid regulatory frameworks and infrastructure. Some studies, including one commissioned by UNCTAD on e-commerce legislation in Caribbean countries[viii], already exist.

Secondly, both the digital trade policy and the subsequent negotiating strategy will require the input and feedback of key stakeholders, including the private sector and regulators which will be tasked with administering any rules, and consumer bodies. Canada, which is one of the Joint Statement signatories, has already launched stakeholder consultations.[ix]

Thirdly, CARICOM countries must be tactical.  They should consider reaching out to other similar-minded developing countries to join the ongoing plurilaterals negotiations, and increase the visibility of issues that are unique to smaller developing countries.

What Next?

As CARICOM ponders its next move, negotiations on the plurilateral front are ramping up.  There is no agreement yet among those engaged in the plurilateral as to the legal structure any eventual agreement will take, nor as to its scope.  But there is a willingness to move beyond the “exploratory” phase to actual negotiations.  In fact, the first meeting of the plurilateral e-commerce negotiations is slated to take place on March 6.

That means that there is still an opportunity for all WTO Members to participate in these negotiations, and thereby influence their shape. The 70 plus signatories include the world’s largest trading economies which account for 90% of global trade.[x]  As the rules negotiated will likely serve as the baseline for any future multilateral e-commerce deal, non-participation by developing countries would relegate them, once again, to the status of rule-takers. This is not an area in which CARICOM countries should leave their destinies in the hands of others.

Dr Jan Yves Remy is the Deputy Director of the University of the West Indies, Cave Hill’s Shridath Ramphal Centre for International Trade Law, Policy & Services. Alicia Nicholls is an international trade and development consultant and a contributing author to the UWI SRC’s Trading Thoughts column. This article was also published in Barbados Today.

[i] https://www.wto.org/english/res_e/publications_e/world_trade_report18_e_under_embargo.pdf

[ii] https://unctad.org/es/paginas/newsdetails.aspx?OriginalVersionID=1281&Sitemap_x0020_Taxonomy=Information%20and%20Communication%20Technologies

[iii] See for example Commonwealth (2017)  https://books.thecommonwealth.org/e-commerce-and-digital-trade-paperback; WTO (2013) https://www.wto.org/english/res_e/booksp_e/ecom_brochure_e.pdf ; E. Humphrey et. al (2003) https://eprints.lse.ac.uk/3710/1/The_reality_of_e-commerce_with_developing_countries.pdf.

[iv] See link for a synthesis of some of the positions: https://www.wto.org/english/news_e/news16_e/good_17nov16_e.htm. For the Indian Government’s views see  https://www.ictsd.org/bridges-news/bridges-africa/news/african-group-submits-proposal-on-e-commerce-ahead-of-wto and also for the African Group’s position: https://www.ictsd.org/bridges-news/bridges-africa/news/african-group-submits-proposal-on-e-commerce-ahead-of-wto

[v] See this link for a greater discussion on the diverging views of WTO members on the way forward: https://www.reuters.com/article/us-trade-wto-digital/some-wto-members-to-push-for-e-commerce-rules-as-broader-deal-fails-idUSKBN1E72YV

[vi] The link to the text of the Joint Statement on E-commerce of January 25, 2019 text is available on this webpage: https://www.wto.org/english/news_e/news19_e/dgra_25jan19_e.htm

[vii] See https://www.thehindubusinessline.com/info-tech/india-keeps-off-75-member-wto-e-comm-agreement-talks/article26093230.ece and https://www.livemint.com/politics/news/india-south-africa-others-skip-wto-negotiations-on-e-commerce-at-davos-meet-1548435856765.html

[viii] https://unctad.org/en/pages/PublicationWebflyer.aspx?publicationid=2084

[ix] http://www.internationaltradecomplianceupdate.com/2019/01/28/canada-launches-consultations-on-future-wto-e-commerce-negotiations/

[x] https://www.wto.org/english/news_e/news19_e/dgra_25jan19_e.htm

Caribbean Trade & Development Digest – February 3-9, 2019

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Welcome to the Caribbean Trade & Development Digest for the week of February 3-9, 2019! We are happy to bring you the major trade and development headlines and analysis from across the Caribbean Region and the world from the past week. We apologise for the delay in the publication of this edition.

THIS WEEK’S HIGHLIGHTS

A bi-partisan bill has been introduced in the US House of Representatives to reauthorize the US Caribbean Basin Trade Partnership Act (CBTPA) until 2030.

Trade was one of themes touched on by US President Donald J. Trump in his State of the Union Address. See write up here.

UNCTAD identified the winners and losers from the US-China trade tensions in a recently released report entitled The Trade Wars: The Pain and the Gain which may be viewed here.

REGIONAL

Bipartisan Caribbean Trade Bill introduced in US congress

CaribbeanNewsNow: US Reps. Terri Sewell (D-AL) and Brad Wenstrup (R-OH) have introduced legislation to reauthorize the US Caribbean Basin Trade Partnership Act (CBTPA) until 2030. Since 2000, CBTPA has allowed for the duty- and quota-free import of goods made with US yarns, fabrics and threads from Caribbean countries. Read more 

Efforts take shape to reduce OECS food import bill

St. Lucia News Online: Spurring domestic agricultural production to meet local and international demand while reducing the region’s food import bill is the focus of a powerful new data tool recently presented to agricultural decision-makers at the OECS Commission. Read more 

Commercial Court ‘could boost’ Barbados economy

Barbados Today: The minister responsible for business is counting on the planned commercial law court to transform the way business is done and boost the flagging economy. Read more 

Trinidad: PM wants technology to play greater role in energy sector; offers help to Caribbean countries

St Lucia News Online: The Trinidad and Tobago government Monday said it is prepared to assist its fellow Caribbean Community (CARICOM) countries develop their hydrocarbon sector as it placed much emphasis on the importance of technology in developing its own industry. Read more 

Marshall and Brown launches Jamaican gourmet line in UK

Jamaica Observer: A new premium Jamaican product line, Marshall & Brown, has been launched in the United Kingdom (UK) to fill a gap in the market for authentic Jamaican food and cooking ingredients.  Read more 

High demand for Jamaican black castor oil in United States

Jamaica Observer: A new study on the local castor oil industry is showing significant potential for Jamaican black castor oil in the United States. The Complete Caribbean study indicates that the US market for the product stands at about US$28 million. Read more 

CDB President calls for resilience, transformation to drive Regional economic growth

CARICOM Today: Although grappling with challenges related to climate change; wide fiscal deficits and high public debt; as well as high unemployment, the Caribbean Development Bank (CDB) today projected that the Region’s economy is expected to grow by 2% in 2019. Read more 

Trinidadians seeking business opportunities in Jamaica

CARICOM Today:A business delegation from Trinidad and Tobago is in the island for a four-day trade mission from February 5 to 8. The team, being hosted by the Jamaica Chamber of Commerce, represents 10 companies involved in various sectors. These are construction, architectural services, food and beverage, agro-chemical, consumer and household products, software development, marketing and advertising. Read more 

Consultations on CARICOM Gender Policy

CARICOM Today: The first of 15 national consultations on a draft Regional Gender Equality Strategy for CARICOM opened on Thursday, in St. John’s, Antigua and Barbuda. Read more 

INTERNATIONAL

Japan seeking big concessions from Britain in trade talks

The Guardian: Japan is seeking tougher concessions from Britain in trade talks than it secured from the EU, while negotiations between London and Tokyo are also being slowed by the looming risk of no-deal. Read more 

US-China trade war could slash almost 1 million jobs from the US economy, new study says

South China Morning Post: Research from the Washington-based consultancy Trade Partnership Worldwide, paid for by the pro-free trade lobbying group Tariffs Hurt the Heartlands, ominously predicts that more than 2 million American jobs could be on the line should US President Donald Trump push ahead with his threat of a 25 per cent tariff on all Chinese exports. Read more

WTO awards South Korea $85 million against U.S. over washing machine tariffs

Reuters: South Korea can impose annual trade sanctions of $84.81 million on the United States after challenging U.S. anti-dumping and anti-subsidy tariffs on washing machines, a World Trade Organization arbitration panel ruled on Friday. Read more

India, Peru to hold next round of free-trade agreement talks in March in Lima

ET Now: India and Peru will hold the next round of negotiations for a proposed free-trade agreement (FTA) in the South American nation next month, a move aimed at boosting two-way commerce between the countries, an official said.  Read more 

Uruguay Betting On Exports Of Medical Marijuana

Jamaica Gleaner: The country got a head start on competitors in December 2013 when it became the first in the world to regulate the cannabis market from growing to purchase, a move that has brought a wave of investment. Read more 

No-deal Brexit: What does the WTO rules option actually mean and how would it work?

iNews: If the UK leaves the EU without a deal, which is still the default option if one cannot be agreed, it would automatically fall back to World Trade Organization (WTO) rules. But what would this actually mean? Read more

Brexit: May says she can get deal through with binding changes

BBC: Theresa May has told EU leaders she can get the Brexit deal through Parliament if they give her legally-binding changes to it. Read more 

African Free Trade Zone deal may come into force in 2 months: Egypt’s FM

Egypt Today: The agreement of the African Continental Free trade Area (AfCFTA) for 55 member states of the African Union may come into force within six months, said Egyptian Foreign Minister Sameh Shoukry on the sidelines of the 32nd session of the African Union that will kick off on Sunday in Addis Ababa. Read more

Turkey, US ‘will reach $75 bln trade target with free trade agreement’

Hurriyet: Trade volume between Turkey and the United States may reach $75 billion through a free trade agreement and the removal of regulations and tariffs, the chairman of the American-Turkish Council has said, stressing that the bilateral potential has never been realized. Read more

A modernized WTO is far better than no WTO at all

The Hill: Last month, on the sidelines of the World Economic Forum in Davos, leading members of the World Trade Organization (WTO) met to discuss how to improve the organization. At the same time, more than 70 governments agreed to commence WTO negotiations on trade-related aspects of electronic commerce. Read more

China says US report on its WTO compliance lacks factual basis

CNBC: China opposes a report by the U.S. Trade Representative’s office on its World Trade Organization (WTO) compliance, the commerce ministry said, saying it is inconsistent with the facts. Read more

WTO NEWS

Arbitrator issues decision in dispute between Korea and US on large residential washers

WTO: On 8 February 2019, a WTO arbitrator issued a decision on the level of trade suspension Korea may request in its dispute with the United States regarding US anti-dumping and countervailing duty measures on large residential washers from Korea (DS464). Read more 

The Caribbean Trade & Development Digest is a weekly trade news digest published by the Caribbean Trade Law & Development Blog. Liked this issue? To read past issues, please visit here. To receive these mailings directly to your inbox, please follow our blog.

Trade Takeaways from Trump’s Second State of the Union Address

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Photo source: Pixabay

Alicia Nicholls

Last night (February 5, 2019), United States (US) President, Donald J. Trump, delivered his second State of the Union (SOTU) address before a joint session of the US Congress. The President highlighted his administration’s progress on his campaign promises, including on immigration, trade, tax policy, infrastructure and national security. This article takes a brief look at the trade takeaways from the SOTU.

The Context

President Trump came to office with the promise, inter alia, of effecting a seismic shift in US trade policy. America, Trump argued, was being taken advantage of by other countries, while “unfair” trade deals were leading to the outsourcing of American jobs to the detriment of American workers and the American economy.

An underlying theme of President Trump’s SOTU address last night was that of “promises made, promises kept”. The President reminded viewers of his campaign promise “to defend American jobs and demand fair trade for American workers”, while highlighting the achievements made thus far.

Much of President Trump’s trade policy actions have been done through executive actions utilising legislation like the Trade Act which empower the President to take certain trade-related action, such as raising tariffs. Indeed, in just two years, the Trump presidency has heralded a decidedly mercantilist turn in US trade policy, marked by increased unilateral action (even against traditional US allies, such as Canada and the EU), the US’ withdrawal from the Trans-Pacific Partnership Agreement, the renegotiation of the tripartite North American Free Trade Agreement (NAFTA), more aggressive action against China, coupled with threats of withdrawal from the WTO and blockage of appointments/re-appointments of WTO Appellate Body members.

Main Trade Takeaways from SOTU

However, in his address, President Trump focused exclusively on trade policy achievements regarding increased enforcement of US trade laws and the renegotiation of NAFTA. Below are the takeaways:

US-China Trading Relations

China has been the principal target of President Trump’s trade policy actions, leading to an escalation in trade tensions between Washington and Beijing which, according to the major multilateral institutions, are already negatively impacting global trade flows and dampening the outlook for the global economy.

In 2018, the Trump administration imposed tariffs on $250 billion worth of Chinese goods, to which Beijing retaliated with tariffs on $110 billion worth of US goods. Although those parties threatened to impose further tariffs, they made a truce on the sidelines of the G20 Summit in December 2018 not to impose any further tariffs for a 90-day period while trade talks resumed between them. Since the start of the truce, two sets of face-to-face trade talks have been held between the two economic behemoths.

While President Trump proudly boasted that America is “now making it clear to China that after years of targeting our industries, and stealing our intellectual property, the theft of American jobs and wealth has come to an end”, he further noted that he and Chinese President Xi were working on a new trade deal. The President, however, reiterated that any US-China trade deal “must include real, structural change to end unfair trade practices, reduce our chronic trade deficit, and protect American jobs”.

From NAFTA to USMCA

In his SOTU address, President Trump noted that “to build on our incredible economic success, one priority is paramount – reversing decades of calamitous trade policies”. To this effect, one of the President’s major trade policy campaign promises was the renegotiation of NAFTA, an agreement which he derided as a “historic blunder” in his SOTU address.

This renegotiation was accomplished last year with the signing of a replacement agreement called the US-Mexico-Canada (USMCA) Agreement. Some of the major changes include the requirement that 75 percent (up from 62.5 percent under NAFTA) of an automobile’s contents needs to be made in North America for it to qualify for duty-free treatment, greater access to the Canadian dairy market for US farmers, an extension of the terms of copyright protection, stronger labour provisions, a sunset clause and provision for review of the Agreement every six years.

The USMCA was signed in November 2018, but is awaiting ratification by the three parties. However, some Democrats have raised issues with the Agreement. President Trump encouraged Congress to ratify the USMCA, in order to “bring back our manufacturing jobs in even greater numbers, expand American agriculture, protect intellectual property, and ensure that more cars are proudly stamped with our four beautiful words: “Made in the USA.”

United States Reciprocal Trade Bill

President Trump also made a strong appeal to Congress to pass the United States Reciprocal Trade Bill (HR 764), “so that if another country places an unfair tariff on an American product, we can charge them the exact same tariff on the same product that they sell to us”.

The US Reciprocal Trade Bill, was introduced in the House on January 24, 2019, by Republican representative from Wisconsin’s 7th District, Sean Duffy (R-WI), who is currently the ranking Member of the Financial Services Subcommittee on Housing & Insurance.

Inter alia, the Bill provides that if the President determines that the rate of duty or non-tariff barriers imposed by a foreign country on a particular US good is “significantly higher ” than the rate of duty or non-tariff barriers imposed by the US on that same good imported from that country, the President is empowered to take several actions, including imposing a rate of duty on imports of that good that is equal to that imposed by that country.

The Bill currently has 19 co-sponsors. According to Representative Duffy’s press release, the proposed legislation would give the President “more flexibility in responding to foreign tariffs on U.S. products” and “the tools necessary to pressure other nations to lower their tariffs and stop taking advantage of America”.

If passed, the Bill will, however, likely be challenged by affected countries through the WTO’s dispute settlement system. However, it should be noted that its successful passage by Congress is not guaranteed. Firstly, the Democrats are the majority in the House of Representatives since January 2019, some of whom have openly criticised Trump’s protectionist trade policies. Secondly, and more importantly, some members of Congress, including some Republicans, are already proposing bi-partisan legislation to limit the President’s authority to unilaterally impose trade restrictions for national security purposes.

In the House, for example, Representative Mike Gallagher (R-Wi-8) introduced H.R.940 to amend the Trade Expansion Act of 1962 to impose limitations on the authority of the President to adjust imports that are determined to threaten to impair national security, and for other purposes. Meanwhile, in the Senate, for example, Senator Mike Lee (R-UT)  introduced the Global Trade Accountability Act (S 177), which would amend the Trade Act of 1974 to require congressional approval of unilateral trade action. The House version (HR 723) was introduced by Representative Warren Davidson (R-OH-8).

However, the passage of any of these proposed bills limiting the President’s trade policy powers are not a sure bet either. Even if passed by both Congressional chambers, the bill would almost certainly be vetoed by the President, and would require a two-thirds majority in each house to override a presidential veto, which is not an easy feat.

The big takeaway

The big takeaway is that President Trump is convinced that his mercantilist trade policy is delivering for the American people, a fact he evidences by the increase in jobs and economic growth. Indeed, a fact sheet  was released by the White House on the same day highlighting the President’s trade policy achievements.

However, his trade policies have come at the cost of increased trade tensions, alienating traditional US allies and creating an impending crisis in the WTO’s Appellate Body whose membership is now down to three – the minimum number of members required to hear an appeal.

Several WTO members have already initiated complaints against certain of President Trump’s trade measures, and/or have raised issues during the US’ most recent Trade Policy Review (TPR).

However, barring some Congressional limit on Presidential trade policy powers, the current trade policy approach is likely to continue for the remainder of the Trump Presidency.

The full transcript of the President’s SOTU Address may be viewed here.

Alicia Nicholls, B.Sc., M.Sc., LL.B., is an international 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.

CARICOM Foreign Policy Coordination: Priority or Pipe Dream?

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Alicia Nicholls

It has been generally recognized by most Caribbean Community (CARICOM) countries, at least in principle, that a coordinated voice on foreign policy issues endows our small countries with bargaining power beyond our size constraints. Indeed, foreign policy coordination is one of the four pillars of CARICOM, with economic integration, human and social development, and security being the other three. However, given the current and increasing discord among CARICOM countries on key international developments, is CARICOM foreign policy coordination still a priority, or is it merely a pipe dream?

An exercise of foreign policy is an exercise of a State’s sovereignty. In general terms, a State’s foreign policy is its strategy in interacting with other States, and is influenced by what that State determines to be its strategic national interests, values, goals and priorities. The key words here are “national interests”, and they may be underpinned by ideology, pragmatism or a combination of the two. A State’s foreign policy is not static, and may change depending on the ideology of the Government in power (for example, whether right-wing, left-wing or centrist) and changing national interests, values, goals and priorities.

As a State’s foreign policy is determined by its national interests, this means that a regional coordinated foreign policy inevitably necessitates the strategic alignment of the national interests of the countries concerned.

Rationale behind the goal of a coordinated CARICOM foreign policy

From as early as the days of CARIFTA (the Caribbean Free Trade Area), the predecessor of CARICOM, the founding architects of the Caribbean regional integration project viewed a coordinated foreign policy as a life raft for assisting our small, then newly independent Caribbean States, to navigate often hostile international Cold War waters in which powerful big country sharks would prey on us little small state ‘sprats’.

Our founding fathers, and later the drafters of the Revised Treaty of Chaguaramas which established the CARICOM Single Market and Economy (CSME), saw a unified foreign policy position as an insurance policy against bullying tactics and the politics of ‘divide and conquer’ – the practice by major powers of playing off CARICOM States against each other, or picking them off one by one through inducements such as aid and other financial support in order to secure votes on hemispheric and international issues. It recognises the old adage of “strength in numbers”. For example, Article 6(h) of the Revised Treaty of Chaguaramas states as one of the Community’s objectives “enhanced co-ordination of Member States’ foreign and [foreign] economic policies”.

Indeed, there have been several instances where Caribbean countries have successfully leveraged their collective voice and numeric strength to their own benefit. Comprising nearly half of the membership of the Organisation of American States (OAS), CARICOM countries are a crucial voting bloc which powerful countries deem necessary to court for voting support on critical hemispheric issues. In the United Nations (UN), CARICOM countries are a smaller but still critical voting bloc.

But do CARICOM member States’ national interests really align to such an extent that a coordinated foreign policy on all issues is still (or was ever) achievable? CARICOM comprises fourteen independent countries and one British Overseas Territory (Montserrat). This necessitates balancing national interests, values, goals and priorities which do not always necessarily align. Indeed, CARICOM countries, while all small States, have their differences, whether in terms of language, geography, economic structure, population, resource endowment or size. All of these factors impact on each State’s perceived national interests, values, goals and priorities.

Foreign policy coordination has been successful in areas like climate change where Caribbean countries see their national interests as inextricably linked. But even on this important issue, there is some policy incongruence. On the one hand, CARICOM countries have demanded more urgent global action to fight climate change, while on the other, some CARICOM member States are still pursuing hydrocarbon exploration and exploitation, as part of their economic development strategy.

There have also been increasing (and frankly, embarrassing) instances of CARICOM foreign policy disunity, from as far back as the infamous US Ship Rider issue in the 1990s, the inability to unite around a single candidate for Commonwealth Secretary General in 2015, to as recently as the UN vote on the US’ controversial motion to recognize Jerusalem as the capital of Israel (instead of Tel Aviv). There is also the still unresolved issue of the region’s position on the One China Policy – some States recognize the People’s Republic of China, while a few still recognize the Republic of China (Taiwan).

The Venezuela Humanitarian Crisis

The latest example of foreign policy disunity relates to the devolving political, economic and humanitarian crisis in the Bolivarian Republic of Venezuela – a country which, despite some differences, has been an important friend to the region in terms of aid and other support. I highlight the Venezuela crisis not just because it is one of the biggest hemispheric crises affecting the region, but it is a nuanced issue which clearly shows the divide in CARICOM countries’ national interests, and hence their diverging positions on the perceived solution.

The suffering of the Venezuelan people wrought by the incompetence of the Maduro regime, and made no better by western countries’ economic sanctions, have caused spill-over security, health, economic and other risks for neighbouring countries. According to the UN, over three million Venezuelans have fled that South American country since the start of the crisis. Many have migrated (illegally in many cases) to neighbouring countries, including Trinidad & Tobago. It is, therefore, in CARICOM countries’ interest for the humanitarian crisis to be solved. However, CARICOM countries differ on what they believe the solution should be.

On January 10, 2019, the OAS Permanent Council approved a resolution not to recognize the legitimacy of the second term of current Venezuelan President, Nicolas Maduro Moros. CARICOM’s disunity on this issue was again on full display for the world to see. The Bahamas, Guyana, Haiti, Jamaica and Saint Lucia were among the 19 OAS member states which voted to approve the resolution. Dominica, St. Vincent and the Grenadines and Suriname were among the 6 (including of course, Venezuela) which voted against the resolution. St. Kitts and Nevis, Trinidad and Tobago, Antigua and Barbuda, Barbados and Belize abstained, while Grenada was the only OAS member State which was absent for the vote.

What explains this disunity? To my mind, mainly national interests, exacerbated by the fact that CARICOM remains an inter-governmental organisation. For instance, Guyana is currently embroiled in a long-standing border dispute with Venezuela, which has been inflamed under the current Maduro regime. This may explain Guyana’s vote in favour of the resolution. Ditto could be said for Jamaica which had recently decided to reacquire Venezuela-owned shares in Petrojam. On the other hand, some other CARICOM Member States are members of the Bolivarian Alternative for the Americas (ALBA) and recipients of assistance from Venezuela through, inter alia, the PetroCaribe Initiative. This may explain why they voted against the resolution. National interests not only dictate a country’s position on an issue, but are what determine whether a CARICOM member State will change its vote based on the promise of aid or support.

Moreover, while the majority of CARICOM member States appear to have adopted a position of non-intervention, some member States (the Bahamas and Haiti) have decided to follow major Western powers in recognizing Opposition leader, Juan Guaido, as interim president of Venezuela.

Given the region’s friendship with Venezuela and the implications of the ongoing crisis for many CARICOM countries, it is commendable that some CARICOM governments have assumed a leadership role on this issue. Some CARICOM governments have vociferously challenged the pronouncements of the OAS Secretary General His Excellency Luis Almagro as not speaking for all OAS member states. A CARICOM delegation led by current CARICOM chairman Dr. the Honourable Timothy Harris, Prime Minister of St. Kitts & Nevis, recently initiated a visit to the UN to discuss the crisis. It should be noted, however, that not all CARICOM governments took part in this meeting, which shows that even on this very important issue, the region still cannot sing from the same hymn sheet.

Is a coordinated CARICOM foreign policy merely a pipe dream?

There appears, at least in rhetoric, a renewed interest by CARICOM leaders in advancing the regional integration process, of which foreign policy coordination has traditionally been a major pillar. This has been aided no doubt by the initiative taken by Jamaica in the commissioning and publication of the Report of the Commission to Review Jamaica’s Relations within the CARICOM and CARIFORUM Frameworks, more popularly referred to as the ‘Golding Report’, and the reinvigorated leadership displayed by Barbados under its new Prime Minister (lead for the CSME in CARICOM’s quasi-cabinet).

The Golding Report identified the glaring failures in foreign policy coordination as one of several challenges currently confronting the regional integration process. The report rightly cites several of the issues which account for this policy disunity, including offers of aid in exchange for votes, lack of political will, inability of diplomats to get clear policy instructions from their capitals, and of course, national interests. As such, recommendation 26 of the Report is to “review the procedures for foreign policy consultation and coordination in order to avoid as far as possible, the types of conflicts and embarrassing positions that have emerged from time to time among CARICOM members depriving it of the collective force it is capable of exerting”.

However, I would go further. In this time of increased introspection by our leaders on the regional integration process, I think there needs to be reconsideration of whether a coordinated foreign policy is really an achievable goal for the region or are we merely chasing a lofty pipe dream which our diverging national interests, values, goals and priorities may be unable to bridge. Indeed, can we really say that the region is any closer to a unified position on the One China policy? Moreover, given the current ideological divide in the region on the issue of citizenship by investment programmes (CIPs), can we really mount an effective and unified CARICOM approach against the EU’s targeting of CIPs in the region?

Let me clarify that I staunchly support our founding fathers’ conviction that there is strength in unified foreign policy positions. Indeed, the enormity of the global challenges confronting the region, whether from Brexit, the possibility of another global downturn, Venezuela, rising populist and nationalist sentiments internationally, blacklisting etc, means that a unified CARICOM front, to the extent possible, should be the desired default position for helping us navigate these challenges.

On the flipside, I also recognise that we must be honest with ourselves. We must face the reality that the goal of a coordinated foreign policy on all issues may be too ambitious given divergent national interests which have accounted for the increasing track record of foreign policy disunity. Indeed, these all too public displays of foreign policy disunity only serve to undermine the Caribbean public’s faith in the sincerity of our leaders’ commitment to the regional integration process, and to empower CARICOM-skeptics. We, perhaps, are setting ourselves up for failure.

An alternative and more achievable approach, therefore, could be for CARICOM member states to clearly identify specific foreign policy priority areas on which they would strive to present a unified policy position. The European Union (EU), for instance, has sought to harmonise its foreign policy (Common Foreign and Security Policy) primarily around security and human rights issues. For CARICOM, priority areas for foreign policy coordination could be more straightforward “low-hanging fruits” such as foreign trade, security, the loss of correspondent banking relationships due to de-risking by global banks, tax issues, and climate change. These are areas in which a unified CARICOM foreign policy position is perhaps most achievable and most effective.

I appreciate that my view may be unpopular and differs from traditional orthodoxy, but in these times of increased economic and geopolitical uncertainty, the continued desirability of pursuing a coordinated foreign policy is an issue which CARICOM will need to resolve and do so quickly, even if we decide we will only coordinate on certain foreign policy issues.

Alicia Nicholls, B.Sc., M.Sc., LL.B., is an international 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 Trade & Development Digest – January 27 – February 2, 2019

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Welcome to the Caribbean Trade & Development Digest for the week of January 27 – February 2, 2019! We are happy to bring you the major trade and development headlines and analysis from across the Caribbean Region and the world from the past week.

THIS WEEK’S HIGHLIGHTS

On the Brexit front, UK Prime Minister Theresa May won support from British MPs for a renegotiation of the Draft Withdrawal Agreement, in particular the removal of the ‘Irish Backstop’, the controversial ‘insurance policy’ to avoid a hard border between the Northern Ireland and Republic of Ireland in the event that the UK and EU are unable to reach a trade deal within the transition period.

However, the EU, including the Republic of Ireland, remains adamant that the current draft Withdrawal Agreement is not up for renegotiation and that the backstop cannot be removed. The UK is due to leave the EU on March 29, 2019.

Another major trade policy development is that the EU-Japan Economic Partnership Agreement has come into force. Additionally, the latest round of trade talks between the US and China have been hailed as a success.

Regionally, some CARICOM leaders initiated a visit to the United Nations (UN) on the situation in Venezuela.

REGIONAL

$10m Investor: We Can Defeat WTO ‘Concerns’

The Bahamas Tribune: A $10m poultry farming investor yesterday expressed confidence that The Bahamas could follow Jamaica’s self-sufficiency lead despite its “concerns” over WTO’s potential impact. Read more 

JMEA head cites one-sided trading conditions affecting Jamaica

LoopJamaica: President of the Jamaica Manufacturers and Exporters’ A’ssociation (JMEA), Metry Seaga, has described the favourable trade conditions that Jamaica extends to its overseas trading partners as being one-sided, saying that too often the same treatment is not returned to the country’s manufacturers and exporters. Read more 

Port Operator KFTL Boasts Record Container Moves In A Day

Jamaica Gleaner: Kingston Freeport Terminal Limited, KFTL, a subsidiary of the French-based shipping company CMA CGM, said that on January 24 it recorded the best performance ever in the history of the port of Kingston in terms of container moves. Read more 

Statistical Institute of Belize: Belizeans paid an average of 30 cents more for goods and services in 2018

Breaking Belize News: For the year 2018, Belizeans paid an average of 30 cents more for goods and services, while for the month of December specifically, consumer prices were about 10 cents less when compared to the year before. Read more 

Statement on second day of visit to the UN by Delegation of CARICOM Member States

CARICOM: On Tuesday, 30 January 2019, the delegation of the Caribbean Community (CARICOM) comprising Dr the Hon. Timothy Harris, Prime Minister of S.Kitts and Nevis (Chairman of CARICOM) and Dr the Hon. Keith Rowley, Prime Minister of Trinidad and Tobago, the Hon. Peter David, Foreign Minister of Grenada, H.E. Irwin LaRocque, CARICOM Secretary-General, as well as the Permanent Representatives of these countries continued its engagements at the United Nations and at the Trinidad and Tobago Permanent Mission in New York on the situation in the Bolivarian Republic of Venezuela and its implications for the Community. Read more 

Belize exports first shipment of crude soybean oil to Jamaica

LoveFM: Belize has made its first shipment of crude soybean oil to Jamaica. The five containers were exported last week and were supplied by Bel-Car Exports and Imports located in Spanish Lookout, Cayo District and Northern Grains Cooperative located in Blue Creek, Orange Walk District. Read more 

CARICOM Leaders To Meet With UN Secretary General On Venezuela

Jamaica Gleaner: Caribbean Community (CARICOM) leaders are to meet with the United Nations Secretary General Antonio Guterres on Monday to discuss the ongoing political situation in Venezuela where the government of President Nicolas Maduro is under international pressure to step down. Read more 

Barbados hosting EU funded meetings

TV6: Barbados is hosting a two-day consultation aimed at continuing the development of a framework for an effective platform for structured and continuous dialogue between the Caribbean Forum (CARIFORUM) and French Caribbean Outermost Regions (FCORs) and British and Dutch Overseas Countries and Territories (OCTs). Read moreRead more

WTO lacks clout on dispute rulings

Bahamas Tribune: The failure to enforce its rulings on trade disputes is among the “biggest criticisms” that can be levelled against the World Trade Organisation (WTO), a Bahamian arbitrator has charged. Read more 

INTERNATIONAL

1-in-3 UK firms have relocation plans due to Brexit

Euractiv: Brexit has prompted almost a third of British companies to move some operations abroad or at least consider it, a survey from an employers group showed on Friday (1 February). Read more 

UAE initiates WTO proceedings against Qatar

Gulf News: The UAE Government announced on Tuesday that it has initiated World Trade Organisation, WTO, dispute-settlement proceedings against Qatar following its ban of the sale of UAE products in Qatari markets. Read more 

China, U.S. make important progress in trade talks, paving way for further consultations

Xinhua: Negotiators from China and the United States have made important progress in the latest round of high-level talks to resolve their economic and trade frictions, laying foundation for further consultations, according to the visiting Chinese delegation. Read more 

Is WTO Article 24 the antidote to a No Deal Brexit? Euronews Answers

Euronews: Nigel Farage, one of the UK’s leading proponents of a ‘hard Brexit’ told Euronews yesterday that the negative impacts of Britain leaving the EU without a deal could be eliminated by the use of “Article 24 of the World Trade Organisation (WTO)”. Read more 

Trump sends Congress list of planned USMCA trade policy changes

Washington Examiner: The Trump administration formally gave Congress a list of its proposed changes to trade policy, requests that will put the U.S.-Mexico-Canada Agreement on trade into effect. Read more 

WTO chief is in denial over climate impact of trade 

Climate Change News: When the head of the World Trade Organisation (WTO) says trade does not impact the environment, we should all be worried. Read more 

US, China may cross swords on e-commerce at WTO

VoA: China has given up its long-held resistance to the World Trade Organization’s push for global standards for the $27 trillion e-commerce market. Some analysts say this is a direct result of the trade war with the United States, which is forcing China to seek wider cooperation with trading countries. Read more

Sturgeon to visit US and Canada for talks on trade links

BBC: First Minister Nicola Sturgeon is to visit the US and Canada next week. The trip is planned in a bid to build stronger trade links between Scotland and North America. Read more

Japan-EU free trade deal takes effect

NHK: A comprehensive free trade deal between Japan and the European Union has come into force. The pact will eventually remove tariffs on more than 90 percent of imports from both sides and liberalize rules in a broad spectrum of fields. Read more

Brexit: MPs back May’s bid to change deal

BBC: MPs have backed seeking “alternative arrangements” to replace the Irish backstop in Theresa May’s Brexit plan. Read more 

Safeguards in free trade agreements: Council adopts horizontal framework for bilateral measures

EU: The EU will soon have in place an overall framework for ensuring consistency of safeguard measures included in free trade agreements. The Council today adopted a regulation streamlining the inclusion of safeguard measures in trade agreements so that they are applied effectively and consistently across the board.  Read more

Iraq, Jordan sign free trade agreement

Middle East Monitor: Jordan has reached a new agreement on free trade with Iraq, the country’s Deputy Prime Minister, Rajai Muasher, said yesterday. Read more 

UK cannot simply trade on WTO terms after no-deal Brexit, say experts

The Guardian: The UK will be unable to have frictionless, tariff-free trade under World Trade Organization rules for up to seven years in the event of a no-deal Brexit, according to two leading European Union law specialists. Read more 

WTO Launches Investigation Into Trump’s China Tariffs, Official Says

Bloomberg: The World Trade Organization launched an investigation into President Donald Trump’s tariffs on $250 billion of Chinese goods, ratcheting up tensions as the two nations are set to begin a new round of trade talks, according to an official with knowledge of the probe. Read more 

EU to fight US tariffs on Spanish olives at WTO

Deutsche Welle: The European Comission will back Spain’s fight to defend its olive exporters, who were hit by Donald Trump’s tariffs in June 2018. Madrid considers the punitive measure to be “an evident prejudice” on olive producers. Read more 

China accuses US of a ‘blatant breach’ of trade policy in WTO meeting

CNBC: Chinese representatives met with the World Trade Organization on Monday to begin the process of legally challenging United States tariffs on China’s exports, Reuters reported, citing a transcript of the meeting’s discussion. Read more 

WTO NEWS

United Arab Emirates requests consultations with Qatar on goods restrictions

WTO: The United Arab Emirates has requested WTO dispute consultations with Qatar regarding certain measures restricting the import, distribution and sale of goods in Qatar from the UAE (DS576). The request was circulated to WTO members on 31 January. Read more

European Union initiates WTO dispute proceedings against US olive duties

WTO: The European Union has requested WTO dispute consultations with the United States concerning US anti-dumping and countervailing duties imposed on imported ripe olives from Spain. The request was circulated to WTO members on 31 January. Read more 

Panels established to rule on US, Turkish tariff measures

WTO: At a meeting of the Dispute Settlement Body (DSB) on 28 January, WTO members agreed to establish a dispute panel to rule on additional duties imposed by the United States on certain imports from China. Members also agreed to establish a panel to rule on additional duties levied by Turkey on certain imports from the United States. Read more 

The Caribbean Trade & Development Digest is a weekly trade news digest published by the Caribbean Trade Law & Development Blog. Liked this issue? To read past issues, please visit here. To receive these mailings directly to your inbox, please follow our blog.

Caribbean Trade & Development Digest – January 20-26, 2019

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Welcome to the Caribbean Trade & Development Digest for the week of January 20-26, 2019! We do apologise for the delay in this week’s issue. We are happy to bring you the major trade and development headlines and analysis from across the Caribbean Region and the world from the past week.

THIS WEEK’S HIGHLIGHTS

The big trade news this week is that on the sidelines of the World Economic Forum (WEF) meeting in Davos, Switzerland, some seventy-six World Trade Organisation (WTO) members agreed to launch negotiations on an e-commerce agreement.

Below are the other major trade and development headlines from across the Caribbean region and the world for last week:

REGIONAL

Tariff Flaws Crippling CARICOM Exports, Says Trade Expert

Jamaica Gleaner: Trade expert Karl Hyatt has called for meaningful amendments to the Common External Tariff (CET) now under review to address some of the entrenched flexibility that has been abused by some CARICOM states. Read more 

Dominica blasts international financial community over unilateral demands, calls for CARICOM unity

St Lucia News Online: The Dominica government Monday blasted the international community over its unilateral demands for tightening measures within the international financial services sector and again called for a united Caribbean Community (CARICOM) approach to the situation. Read more 

Jagdeo meets CARICOM Chairman on no-confidence motion

Stabroek: The Leader of the Opposition, Dr. Bharrat Jagdeo,  today met with the Chairman of CARICOM, Dr. Timothy Harris, Prime Minister of St. Kitts and Nevis and a team, including CARICOM-Secretary-General, Ambassador Irwin LaRocque , at the Office of the Leader of the Opposition on Church Street. The meeting discussed the no-confidence motion against the current APNU+AFC coalition government, a statement from Jagdeo’s office said. Read more 

Private Sector and Labour Leaders to Participate in Caricom Heads Meetings

JIS News: The revised Treaty of Chaguaramas is to be amended to allow representatives of the private sector and the Caribbean Congress of Labour to participate in CARICOM Heads of Government meetings, says Barbadian Prime Minister, Hon. Mia Mottley. Read more 

Statement by Heads of Government of CARICOM on Venezuela

CARICOM: The following Heads of Government of the Caribbean Community (CARICOM) – Antigua and Barbuda, Barbados, Belize, Dominica, Jamaica, Montserrat, St. Kitts and Nevis, Saint Lucia, St. Vincent and the Grenadines, Trinidad and Tobago; Foreign Ministers of Grenada and Suriname;, meeting by video-conference on 24 January 2019, issued the following statement. Read more 

High level CARICOM talks held in Guyana

St. Kitts & Nevis Observer: The Prime Minister of St. Kitts and Nevis and current Chairman of the Caribbean Community (CARICOM), Dr. the Honourable Timothy Harris, is currently in the Cooperative Republic of Guyana where he is holding several rounds of discussions with top level CARICOM officials, including Secretary-General, Ambassador Irwin LaRocque. Read more 

CARICOM Development Fund clinches US$1m pact with India

Stabroek: India and the CARICOM Development Fund (CDF) signed a Contribution Agreement on January 19th, 2019, in Paramaribo Suriname which provides for a grant allocation of US$1m to the CDF’s capital fund. Read more 

INTERNATIONAL

DAVOS-Nearly half WTO members agree to talks on new e-commerce rules

Reuters: Impatient with the lack of World Trade Organization rules to cover the explosive growth of e-commerce, 76 countries and regions agreed on Friday to start negotiating this year on a set of open and predictable regulations. Read more 

Uruguay diverges from Mercosur, aligns with Mexico on Venezuela crisis

Buenos Aires Times: Uruguay and Mexico call for peaceful resolution in a joint statement released Wednesday, after opposition leader Juan Guaido declares himself interim president. Read more 

Brexit trade deal agreed by British and Israeli ministers, in principle

Jewish News: British and Israeli ministers have announced that they have agreed a post-Brexit trade agreement in principle. Read more 

Brexit: New Zealand’s Jacinda Ardern says trade deal ‘a priority’

BBC: New Zealand’s prime minister has said she is “ready and willing” to sign a post-Brexit trade deal with the UK. Jacinda Ardern said negotiating a free trade agreement would be a “real priority” once the UK had left the EU. Read more

Japan-U.S. talks on bilateral trade deal likely to face delay

Japan Times: Japan and the United States are unlikely to open negotiations on a proposed bilateral trade pact before the end of this month, due chiefly to the prolonged partial U.S. government shutdown, sources have said. Read more 

Commerce Secretary Wilbur Ross: The US is still ‘miles and miles’ from a trade deal with China

CNBC: Commerce Secretary Wilbur Ross said Thursday the U.S. is still “miles and miles” from a trade deal with China. Read more

No Sweeping Free Trade Deal, Brussels Tells Washington

Foreign Policy: Six months after U.S. President Donald Trump proclaimed he’d already reached a trade deal with the European Union, Brussels has only now laid out its preliminary conditions for talks. Read more 

Expert urges caution over speedy trade deal with EU

Radio New Zealand: A trade expert is advising negotiators not to rush a free trade agreement with the European Union, New Zealand’s third largest export market. Read more

Brexit: Liam Fox yet to seal no-deal trade agreements

BBC: The UK has yet to finalise agreements to replace existing free trade deals the EU has with 40 big economies if there is a no-deal Brexit. International Trade Secretary Liam Fox said he “hoped” they would but it depended on whether other countries were “willing to put the work in”. Read more 

WTO NEWS

United States appeals panel report regarding US duties on Turkish pipe and tube products

WTO: The United States filed an appeal on 25 January concerning the WTO panel report in the case brought by Turkey in “United States — Countervailing Measures on Certain Pipe and Tube Products” (DS523). The panel report was circulated to WTO members on 18 December 2018. Read more 

DG Azevêdo meets ministers in Davos: discussions focus on reform; progress on e-commerce

WTO: Participating in a series of ministerial discussions during the World Economic Forum Annual Meeting in Davos this week, Director-General Roberto Azevêdo reviewed the challenges and opportunities facing global trade today, and stressed that the trading system must evolve if it is to remain relevant. Read more 

DDG Yi stresses importance of WTO-APEC cooperation in crucial period for global trade

WTO: Deputy Director-General Yi Xiaozhun has stressed the importance of exploiting the synergies between the WTO and the Asia-Pacific Economic Cooperation (APEC) in a crucial period for global trade. Read more 

Registration opens for public hearing in “US — Countervailing Measures on Softwood Lumber from Canada”

WTO: At the request of the parties in the dispute “US — Countervailing Measures on Softwood Lumber from Canada” (DS533), the panel has decided to open its first substantive meeting to public observation on 26, 27, and 28 February 2019. The live screening will take place at the WTO’s headquarters in Geneva. Read more 

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