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Begin New Search Topic International Trade and Finance Content Type Policy Brief

31. Africa Megatrends: Looking over the Horizon into the Future

Author:
Olli Ruohomäki
Publication Date:
03-2021
Content Type:
Policy Brief
Institution:
Finnish Institute of International Affairs
Abstract:
Africa is an enormous continent composed of several regions and 54 states, populated with more than 1.3 bil- lion people. Tere are more than 1,500 languages and diverse cultures. Both low-income and high-income countries and disparate levels of development are found on the continent. There is both concern and hope in the air regard- ing the trajectory that Africa’s development will take. Dwelling solely on negative news about confict, polit- ical turmoil, hunger and refugees is not constructive. Neither is seeing Africa through ‘rose-tinted glasses’ as a continent full of promise for trade and investment prospects. Rather, a balanced and realistic vision that looks over the horizon into the future is required. Talking about the diverse and vast continent as a whole is fraught with potential accusations of sweeping generalizations and even arrogance. Nonetheless, this is exactly what the business of forecasting is all about. To put it another way, predicting the future is essentially about painting the canvas with broad strokes and seeing the big picture. It is then up to area studies, sociology, anthropology, political science and similar disciplines to dwell on the more nuanced and detailed case studies. Hence, despite the complexity that forecasting the future of Africa entails, it is possible to outline the main contours of the trajectory of change that in- forms the course of developments on the continent.1 It is with this in mind that this Briefng Paper exam- ines seven megatrends that are shaping the future of Africa
Topic:
Climate Change, Democratization, Environment, International Trade and Finance, Regional Cooperation, Urbanization, Conflict, Regionalism, and Population Growth
Political Geography:
Africa

32. Illicit Cigarette Consumption in Mexico

Author:
Oxford Economics
Publication Date:
09-2021
Content Type:
Policy Brief
Institution:
Oxford Economics
Abstract:
This research seeks to quantify the size and scale of the illicit consumption of cigarettes in Mexico, as well as the impact on government revenues, and how this has changed in recent years. This study shows that: In the first half of 2021, an estimated 18.8% of all cigarettes consumed in Mexico were of illicit origin. In volume terms, this was more than 38% higher than the same period in 2019 (pre-Covid level). The rise in Illicit Consumption has been driven by an increased presence of cigarettes without the SAT’s security code – particularly the brands ‘Economicos’ and ‘Link’ – with Domestic Illicit now accounting for around two thirds of total Illicit Consumption in Mexico (up from 50% in 2019). Non Domestic Illicit consumption – primarily consisting of cigarettes originating from China – has been relatively stable over the last few years. Foregone Excise Tax receipts amounted to an estimated 19.4% of total potential Excise Tax revenues in 2021 H1.
Topic:
International Trade and Finance, Tax Systems, Illegal Trade, and Consumption
Political Geography:
North America and Mexico

33. China and the Persian Gulf in the Aftermath of a U.S. Withdrawal

Author:
Steven Simon
Publication Date:
09-2021
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
• Given longstanding U.S. economic ties to the Arab Gulf states, the withdrawal of the U.S. military would not mean the United States is departing from the region. Even if it did signify that, however, China would be unlikely to fill the vacuum. A U.S. decision to maintain a military presence in the region should therefore not be based on fear of a strategic vacuum that China will fill to America’s disadvantage. • The United States should leverage China’s interest in stable cross–Gulf relations by working in tandem with Beijing to encourage dialogue and confidence-building measures. • The United States should monitor Chinese military deployments to the Indian Ocean and work with Gulf partners to set limits on China’s military use of air and naval bases. This would serve as a confidence-building measure and ensure that the Gulf does not become an arena for competition amid heightened Sino–American tensions.
Topic:
Foreign Policy, International Trade and Finance, Military Affairs, and Strategic Engagement
Political Geography:
China, Middle East, Persian Gulf, and United States of America

34. The Good, the Bad and the Ugly: Taking Stock of Europe’s New Trade Policy Strategy

Author:
Fredrik Erixon
Publication Date:
04-2021
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
This Policy Brief takes stock of the EU Trade Policy Review – the Commission’s proposed strategy for trade. Despite appearances, the Review doesn’t come close to its billing as a strategy for the new geopolitics of trade. In fact, the Review is weak on key geopolitical developments and rather gives the impression that the EU doesn’t have an ambition to shape outcomes. Obviously, the Review is anchored in Europe’s general economic climate: defensiveness on globalization, competition and digitalization. It follows that Europe is getting increasingly detached from world developments. There are several good parts in the Review. The Commission wants to revive and reform the World Trade Organisation, and it’s clear about what factors that have made the Geneva-based trade body dysfunctional. The Review also acknowledges that the EU will seek a closer alliance with the United States and use that for constructive purposes. Finally, it is welcome that the Commission proposes some new instruments for dealing with market distortions caused by foreign subsidies and protectionism in government procurement. All these initiatives can achieve good outcomes. However, they all require that Europe makes changes in its own policies and positions. The bad parts in the Review are Europe’s weak agenda for getting better market access in the growth regions in the world and its continued passivity on matters related to China. Europe’s main trade-policy challenge in the next decade is to ensure that businesses and consumers in Europe get better integrated with a world-market dynamism that predominantly will come from the Asian region. Absent a realistic and medium-term strategy for dealing with challenges connected to the rise of China, Europe will have difficulties getting the EU-China Comprehensive Agreement on Investment approved. Europe needs an actionable agenda for addressing bilateral frictions with China and problems that occur outside bilateral trade. Finally, the ugly part of the trade strategy are all the commercial policies in the EU – with strong effects on trade – that aren’t recognized or only casually mentioned in the Review. The latter category includes the ambition to introduce an autonomous carbon border tax on imports. Such a policy comes at a high political and economic cost, and the measure’s effect on reducing global carbon emissions is at best very negligible.
Topic:
Globalization, International Political Economy, International Trade and Finance, Treaties and Agreements, European Union, Geopolitics, Digital Economy, and Trade
Political Geography:
Europe

35. Global Trade Today is Global Value Chains

Author:
David Henig
Publication Date:
01-2021
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
In the last 25 years global value chains have come to dominate global trade in a way surprisingly little discussed or understood. To meet the policy challenges of today and the future we need to understand the key characteristics of this new global trade and how they came about. The OECD estimate around 70% of total trade takes place in global value chains. Using their definition as where “the different stages of the production process are located across different countries”, and considering both goods and services inputs, this may be an understatement. The example most commonly used is the automotive sector, with 30,000 parts and associated services like satellite navigation going into one car. However there are many others. Modern primary commodity production is optimised by technology developed in other countries, diverse services and goods are frequently combined to create new product offerings, and most international business to consumer transactions are facilitated by leading global platforms. Positively this new globalization has provided consumers with an unprecedented choice of products at affordable prices. More challengingly it has seen governments struggle with the question of how they can best influence modern trade, amid signs of a backlash and simple demands for ‘more domestic manufacturing’. The popular global narrative that feeds such demands is one that has a traditional view of trade as a set of simple primary or manufactured goods transactions. Policymakers must move on from this narrative, making their choices, and explaining them clearly, on the basis of global value chains.
Topic:
International Political Economy, International Trade and Finance, Trade, and Global Value Chains
Political Geography:
Global Focus

36. Economic crisis in the Middle East and North Africa

Author:
Marek Dabrowski and Marta Dominguez-Jimenez
Publication Date:
01-2021
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
In the 2010s, the economic situation in the Middle East and North Africa (MENA) deteriorated as a result of lower oil and other commodity prices, a new round of domestic political instability, continuous intra-regional conflicts, stalled economic and governance reforms and, finally, the COVID-19 pandemic. The growth of real GDP, which slowed after the global financial crisis of 2008-2009, further decelerated in the second half of the 2010s and became negative in 2020 as result of the COVID-19 shock. Fiscal balances have deteriorated, even in the oil-exporting countries, and public debt has grown rapidly. MENA countries continue to face numerous long-term socio-economic and institutional challenges including high unemployment (especially youth unemployment), low female labour-market participation rates, the poor quality of education, costly and ineffective public sectors, high military and security spending, high energy subsidies and trade protectionism. Only comprehensive long-term reform programmes can address these challenges. The European Union is MENA’s second largest trading partner after the region itself, and is one of two main sources of foreign direct investment and a major aid donor. However, given the critical importance of the MENA region to its own security and stability, the EU’s engagement in conflict resolution and in supporting economic and political transformation of the region is insufficient and should be intensified. The EU should also update and upgrade its existing association agreements with the countries of the Southern and Eastern Mediterranean, including their free trade provisions.
Topic:
International Trade and Finance, Governance, European Union, Trade, COVID-19, and Economic Crisis
Political Geography:
Europe, Middle East, and North Africa

37. New York City: Rebuilding a Future-Focused Economy

Author:
Committee for Economic Development of the Conference Board
Publication Date:
08-2021
Content Type:
Policy Brief
Institution:
The Conference Board
Abstract:
Major shifts are expected in how New Yorkers work in the postpandemic economy—remotely or in the office. But the COVID-19 pandemic has also dramatically accelerated a shift in the sectoral landscape of New York City and the industries in which New Yorkers will work. Restoring the city’s economic dynamism and creating a postpandemic, locally prosperous, and globally competitive economy will hinge on leveraging the city’s growth sectors and ensuring that New Yorkers have the skills they need to rebuild a thriving, future-focused NYC economy. The city lost almost 900,000 jobs during the initial months of the pandemic and had recovered just over half of those jobs by June 2021. Many of these job losses are in sectors that had seen relative weakness prior to the pandemic, including the city’s historically important finance & insurance and real estate sectors. The recovery in NYC has so far been an unbalanced one, lagging behind other major US city centers. Much of NYC’s ongoing economic recovery has been concentrated in health care, life sciences, and the growing tech industry, sectors that were strengthening prior to the pandemic. Indeed, tech jobs were already driving much of the employment growth in NYC before the pandemic. And while office and residential buildings emptied out during the crisis, Big Tech companies—including Amazon, Apple, Facebook, and Google—have increasingly moved in, expanding their office and warehouse spaces and accelerating hiring.
Topic:
International Trade and Finance, Finance, Economy, and COVID-19
Political Geography:
New York, North America, and United States of America

38. The Impact of Unilateral Trade Policy on International Trade Structure

Author:
Moonhee Cho
Publication Date:
09-2021
Content Type:
Policy Brief
Institution:
Korea Institute for International Economic Policy (KIEP)
Abstract:
Uncertainty grows with the diffusion of unilateral trade policies. In particular, the average value of the World Uncertainty Index increased by four to fivefold compared to 1990. Recently, unilateral trade policies are spreading internationally. Non-tariff measures including anti-dumping, countervailing measures, SPS and TBT are increasing. Moreover, both developing and developed countries are adopting trade-disruptive measures and these are rapidly increasing. This report analyzes the widespread diffusion of unilateral trade policies and changes in trade structures.
Topic:
International Trade and Finance, Trade Policy, and Unilateralism
Political Geography:
Global Focus

39. The Impact of Intellectual Property Protection through FTA on International Trade

Author:
Hyunsoo Kim, Sangjun Yea, Hyeyoon Keum, and Min Ji Kang
Publication Date:
08-2021
Content Type:
Policy Brief
Institution:
Korea Institute for International Economic Policy (KIEP)
Abstract:
The importance of intellectual property rights (IPRs) for innovation has grown and the protection of intellectual property in international trade has also been strengthened. AI-related patent applications have been increasing rapidly and many AI patents are being filed in various industries. Intellectual property also represents one of the main controversies of U.S.-China trade relations in the past three decades and remains one of the core issues behind the two countries’ recent trade conflicts. As a result, global protection for IPRs has been expanded in recent decades. This article investigates changes in the trend regarding the IP protection level in FTA and how the IP protection through FTAs has affected the composition of aggregate trade flows of member countries in order to provide basic findings necessary to formulate the FTA policies regarding the protection of IPRs in Korea.
Topic:
International Trade and Finance, Intellectual Property/Copyright, Economy, and Artificial Intelligence
Political Geography:
China, South Korea, and United States of America

40. The Crisis of the WTO and New Direction for Negotiation Strategies of Korea

Author:
Jin Kyo Suh, Cheon-Kee Lee, Jukwan Lee, Ji Hyeon Kim, and Myeonghwa Jung
Publication Date:
06-2021
Content Type:
Policy Brief
Institution:
Korea Institute for International Economic Policy (KIEP)
Abstract:
The WTO is facing a historical crisis. Its main functions ‒ namely, providing a negotiating forum, administrating WTO trade agreements and monitoring national trade policies, and resolving trade disputes ‒ have been significantly paralyzed. Although the cause of the crisis is partly institutional, higher uncertainty is also a considerable problem aggravating the fate of the multilateral trading system. Such uncertainty comes from two factors: rising protectionism, and trade frictions between developed and developing countries including those between the United States and China. Meanwhile, the WTO also needs to respond to rapid structural changes in global trade. The center of the world’s trade is shifting towards trade in services. The development and spread of information and communication technology (ICT) are making it easier to supply services across borders. The regionalization or localization of global value chains (GVCs) continues and GVCs are shifting towards knowledge-based goods. Therefore, the WTO faces a historical challenge it is highly unlikely to survive without proper reflection on the new trends of global trade. With Korea no longer claiming for preferential treatments as a developing country, it could take relatively firm negotiating positions at the WTO concerning market expansion and improved access towards foreign markets. Moreover, Korea could contribute as a mediator to speak for balancing the interests of both developed and developing countries on conflicting issues, such as the developing country status. Korea also needs to establish a more precise give-and-take negotiation strategy in future WTO negotiations on agriculture, non-agriculture, and service sectors to maximize its national interests. In particular, Korea should put stress on services and TRIPs negotiations to ensure its international competitiveness on those sectors. Trade in services and IP will dominate trade in goods. Korea also should focus on how to raise the efficiency and stability of the East-Asian regional value chains by strengthening its co-operation with China, Japan, and Southeast Asia. At the same time, Korea needs to consider ways to become the bridgehead connecting East Asia’s value chains to either North America’s value chains or the EU’s value chains utilizing given FTAs with those economies. Finally, Korea should prepare for the emergence of various forms of plurilateral negotiations and where appropriate, take lead and reflect its national interests on the final outcome.
Topic:
Development, International Trade and Finance, Negotiation, Trade Policy, and WTO
Political Geography:
South Korea