Disruption in the World of Trade — C. P. Chandrasekhar and Jayati Ghosh

World trade is in deceleration mode.

Real-World Economics Review Blog
Disruption in the World of Trade
C. P. Chandrasekhar and Jayati Ghosh
This article was originally published in the Business Line on June 3, 2019

Nicolas Rapp, Matthew Heimer — This Map Shows How China Is Building its Global Trade Empire

About $900 billion worth of infrastructure developments are now either underway or in detailed planning stages, according to the China Development Bank; this map highlights some of the signature projects.

Fortune
This Map Shows How China Is Building its Global Trade Empire
Nicolas Rapp, Matthew Heimer

Richard Baldwin, Masahiro Kawai, Ganeshan Wignaraja — Future of the world trading system: Asian perspectives

The WTO risks losing its centricity in the world trading system due to its focus on 20th century trade issues and lack of progress in the Doha Round. This column introduces a new eBook that looks at how Asia meanwhile built a deep network of supply chains and is experimenting with new forms of regional trade governance. Asia’s experience of open trade-led development offers lessons for other regions. Better coherence is also vital between Asia’s regional trade rules and global trade governance.

VOX
Future of the world trading system: Asian perspectives
Richard Baldwin, Professor of International Economics, Graduate Institute, Geneva; CEPR Policy Director, and VoxEU.org Editor-in-Chief; Masahiro Kawai, Dean of the Asian Development Bank Institute and Ganeshan Wignaraja, Director of Research of the Asian Development Bank Institute (ADBI)

The Western model breaking down?

Vinod K. Aggarwal and Simon J. Evenett — The Sad Truth Behind Growing Clashes at the WTO

What we've seen instead [of tariffs and other forms of protectionism] is selective subsidization—a more direct response to the fact that, at the onset of a crisis, firms need cash more than they need customers. Indeed, so many governments implemented subsidies (thereby delaying reductions in capacity and employment in many sectors and thus distorting trade flows) that we saw the perverse effect for a while that no one brought cases to the WTO. As the saying goes, people who live in glass houses mustn't throw stones.

The governments behind these subsidies weren't only interested in stabilizing their firms. They were also interested in restoring economic growth. In addition to across-the-board monetary and fiscal policy measures, many of them targeted specific sectors and even specific firms as growth poles. This amounts to a revival of the industrial policy that has been pooh-poohed for decades in the US, the UK, and much of the English-speaking world.

Now, disputes have arisen over these crisis-era state efforts at industrial policy, particularly in auto parts, wind power, and solar panels—and also over some pre-crisis industrial policy initiatives, such as those relating to biofuels. But do these formal objections reveal only the tip of the iceberg?....

Here's the bottom line for managers: don't count on WTO rules to protect your interests. It is clear that, during the crisis era, policy choice has sought to circumvent the stricter WTO rules. Because so much of this favoritism has taken the form of various subsidies rather than import-reducing measures such as tariffs and antidumping measures, governments have felt they did not have to change their rhetoric. Publicly, they can claim to maintain "open borders" to commerce even as they aggressively shift the odds in favor of a select few.

Don't be misled by the avowed rejections of protectionism. Just because tariffs aren't being raised across the board, it doesn't mean firms' overseas commercial interests are being treated without prejudice. Policymakers' commitment to the level playing field has been tested during the crisis era and found wanting—and managers must now live with the consequences.

The Harvard Business Review | HBR Blog Network
The Sad Truth Behind Growing Clashes at the WTO
Vinod K. Aggarwal and Simon J. Evenett

Philip Pilkington interviews John Harvey — Exchange Rates and Modern Trade Theory

The focus of discussion is John's book, Currencies, Capital Flows and Crises: A Post-Keynesian Analysis of Exchange Rate Determination

Naked Capitalism
Exchange Rates and Modern Trade Theory
An Interview with John Harvey, Professor of Economics at Texas Christian University, by Philip Pilkington

Russia approved to join WTO

The World Trade Organization has given its second and final approval for Russia's membership in the trade body after a record 18-year quest to join.

The 153-nation global trade body approved by consensus Russia's application for membership on Friday, giving a boost to the ailing economy of its biggest trading partner, the European Union.

"The ministerial conference so agrees," said Olusegun Aganga, Nigeria's Trade Minister, who is chair of the eighth WTO ministerial conference. The decision was taken mid-way during the three-day meeting in Geneva.

The Russian parliament will have up to June 15 next year to ratify the accord and bring it into force.

The deal is expected to quickly increase EU exports by some 4bn euros ($5.45bn) a year.

Under the deal, Russians can buy European-made goods at far lower prices and sell its oil and gas more efficiently.....

Until now, Russia has been the only member of the Group of 20 leading economies still outside the WTO.

Read the rest at Al Jazeera

WTO admits Russia as a member

Another step forward toward a global economy and tighter political integration and international interdependence as a consequence.