The document, which was released last week by China’s State Council, says that subsidies will be redirected towards the most productive areas, with grain farmers in particular receiving more direct payments.

It also outlines plans for increased spending on genetically-modified crops, in a move which government officials privately acknowledged could be controversial.

However, despite the overall policy focus on science and technology, the broad focus of farm support will continue to reflect trends in recent years, sources said - with farmers receiving improved seeds, breeding stock, and farm machinery at lower prices.

Three ‘nongs’

In a sign of the political importance attached to agriculture in China, this is the ninth year running in which the first policy communication unveiled by the government has been devoted to the ‘three nongs‘, or three rural issues - agriculture, farmers, and the countryside.

While the announcement - known simply as ‘Policy Document no. 1′ - spells out the broad policy orientation for agriculture in the year ahead, it does not include detailed figures on topics such as spending levels for particular types of support.

The document reflects a wider concern with the problem of improving productivity in developing country agriculture, noted Andrzej Kwiecinski, senior agriculture policy analyst at the Organisation for Economic Co-operation and Development (OECD).

“That’s the reason why it’s attracting more attention than in the past,” he said.

Subsidy shift

The government will “increase the intensity” of farm subsidies, the document says, and redirect them towards the more productive regions, large-scale farmers, and co-operatives.

Government sources told Bridges that this would mean rice-producing areas in the south of the country could receive increased support, such as Hunan, Hubei, Guangdong, and Guangxi. Wheat-producing regions in the north and north-east of the country could also benefit.

All of China’s farm subsidies are notified as ‘green box’ support at the WTO - meaning they ostensibly cause not more than minimal trade distortion (see Bridges Weekly, 19 October 2011). A small amount of trade-distorting payments are also permitted, on the condition that they represent less than 8.5 percent of the value of production - known as ‘de minimis’ support at the WTO.

Chinese policy-makers have emphasised that new programmes need to remain within this limit. “The space for WTO de minimis subsidies should be a ceiling” for any new price support programmes, argues Dr. Cheng Guoqiang of the State Council Development Research Centre in a recent article.

Trade distortions?

Currently, China’s reported de minimis spending is well below this ceiling. But experts indicated that some other subsidies, such as indirect support to inputs such as fertilisers, might still have trade-distorting effects.

For these payments, “the major beneficiaries are not the farmers but the input suppliers,” observed Kwiecinski.

Other analysts noted a correlation between growing green box support and cereal output trends, even though no trade-distorting ‘amber box’ support has been notified.

“Given the apparent low levels of subsidies, it would be interesting to find out what factors have contributed to the impressive production increase for cereals” said Josef Schmidhuber, Principal Officer with the UN Food and Agriculture Organisation.

“Lots of people have asked ‘are the payments strictly within the definitions?’” said one Geneva-based trade negotiator. “There’s increasing interest in what China’s doing in this area.”

Environmental protection

According to the No. 1 Document, subsidies will continue to be targeted at environmental goals - such as protecting forests, grasslands, and wetlands, and conserving soil and water resources.

However, Schmidhuber suggested that farm subsidies for fertilisers and energy may also have contributed to environmental problems in China - along with indiscriminate use of inputs by farmers.

“There’s too little potassium and phosphate, and too much nitrogen,” Schmidhuber observed, noting that efforts to manage water resources and manage greenhouse gas emissions were suffering as a result.

While this year’s policy document focuses on agricultural science and technology, last year’s one underscored the importance of water conservation and irrigation for farming and rural areas.

A recent article by Shenggen Fan, Director-General of the International Food Policy Research Institute, nonetheless argues that China does not face “a choice between water conservancy and technology.” Instead, Fan said, the country “needs both.”

Rural - urban divide

Coming at a time when the gap between rural and urban incomes continues to widen, the policy release is being seen as a sign that the government intends to tackle social inequalities - a potential cause of unrest in a country where around half of the population of 1.3 billion still lives in rural areas, and over one-third works in farming.

Yue Liang, a representative of the nation-wide China Farmers’ Assocation, told Bridges that the government needs to focus investment on education and training in rural areas.

“Schools in rural areas should teach students how to farm during the compulsory education stage,” said Yue, who is based in the province of Hebei. “Without these skills, the younger generation who were born in the 1990s will be lost, as they will be unable to farm, and unwilling to become industrial workers in cities.”

The government is “fully aware” of the problems caused by large numbers of labourers leaving rural areas, one official said, who told Bridges that increased spending on extension and advisory services was part of the solution.

Echoing the same sentiment, the OECD’s Kwiecinski underscored the importance of investing in knowledge. “Advisory and extension services would be useful in helping farmers to achieve higher yields and lower costs.”

GMOs: China ‘should not be left behind’

The government will continue to expand support for genetically-modified organisms, the new policy says, in a move which government sources recognised could be controversial among some.

“So far we only have had GM plants for cotton and horticulture, not for food,” one official told Bridges.

However, although the country does not grow genetically-modified soybeans, it does import them in significant amounts. In addition, a new policy introduced last year now allows Chinese farmers to grow genetically modified rice.

“That’s also controversial in China,” the official said.

However, he added that the country “shouldn’t be left behind in technological development.”

“Feeding the people”

One government official argued that the government needed to attach importance to domestic agriculture in order to be able to “feed our people.”

He noted that the country is “able to keep self-sufficiency in grains at around 95 percent. The rest will be provided by trade.”

“China has made huge progress in reducing hunger,” acknowledged Schmidhuber.

However, the basket of grains that China sees as critical for self-sufficiency is nonetheless evolving, noted Kwiecinski. Soybeans, which the country now imports in vast quantities, previously appeared on the list - and the same could happen to maize.

What role for trade?

Trade is still important for China, not just in satisfying the demand for grain and other products that the country cannot meet alone, but also in allowing the country to export labour-intensive farm products to the rest of the world.

“That means jobs for Chinese farmers,” one government official said.

China’s US$34 billion trade deficit for agricultural goods expanded by 47 percent in 2011, according to recently-released figures from the ministry of agriculture. While farm exports increased by US$61 billion, or 23 percent, imports grew by US$95 billion, or 31 percent.

Despite the growth in trade, the government nonetheless continues to see the production of ‘strategic products’ - wheat, corn, rice, cotton - as an area where it needs to remain self-sufficient.

“No one else can produce enough to sell to China: that’s impossible,” the official solemnly observed.

ICTSD reporting; “CPC Central Committee and State Council issue text on accelerating agricultural scientific and technological innovation, continue to enhance supply of agricultural support (中共中央、国务院印发《关于加快推进农业科技创新持续增强农产品供给保障能力的若干意见》(全文)),” XINHUA, 1 February 2012;  “How to Boost Agro-Technology,” CHINA DAILY, 3 February 2012.

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“China objects to the EU’s decision to impose the scheme on non-EU airlines, and has expressed its concerns over the scheme through various channels,” the 6 February statement by the Civil Aviation Administration of China said. The statement also argues that the inclusion of aviation under the bloc’s Emissions Trading Scheme (ETS) is in breach of UN Framework Convention on Climate Change (UNFCC) and International Civil Aviation Organization (ICAO) principles.

The European Court of Justice, Europe’s top court, ruled in December that the inclusion of aviation under the ETS is fully compatible with international law. Shortly thereafter China’s four biggest airlines said would not comply (see Bridges Weekly, 11 January 2012). This latest move by Beijing, however, raises the level of discourse to the capitals.

According to Xinhua, the country’s official news agency, airlines cannot join the ETS or use it as a justification for raising ticket prices without government approval.

Trade tensions

Some officials have suggested that the aviation policy could result in a “trade war,” with Chinese state media calling it a “trade barrier in the name of environmental protection.” Monday’s statement alluded to the trade dimension, suggesting that it was considering retaliating in some way.

“China will consider additional measures to protect the interests of our citizens and our companies,” the statement said.

The European Commission has said that airlines that do not comply with the ETS will be fined and could be banned from EU airports. But Isaac Valero-Ladrón, the commission’s spokesman for climate action, told reporters in January that they are “confident” that companies will comply.

Markus Ederer, the EU’s ambassador to China told reporters today that Brussels hopes the issue can be resolved through negotiations or, ultimately, in court.

ETS opponents want “global” solution

China - along with fellow ETS opponents, Russia, India, the US, and others - say Europe’s unilateral approach will be less effective than a global solution. The Montreal-based ICAO, the UN body responsible for civil aviation, has said that it plans to form a global emissions system.

The China Air Transport Association - which includes the country’s biggest state-owned airlines Air China, China Southern, and China Eastern - has been pressuring Beijing to oppose the levy. The association says the scheme could cost Chinese airlines as much as US$127 million in 2012.

“I believe all sides will negotiate again and find a solution,” said Chai Haibo, the group’s vice president. “I can’t imagine that the worst case, such as the EU grounding Chinese flights, could happen.”

China has the world’s fasted growing aviation industry, with many direct connections with European cities.

The US House of Representatives in October 2011 passed a similar bill that would make it illegal for US airlines to comply with the scheme (see Bridges Trade BioRes, 31 October 2011). However, the bill must still receive approval from senate and the president to become law.

ICTSD Reporting; “China bars airlines from EU tax plan,” FINANCIAL TIMES, 6 February 2012; “China Bans Airlines From Joining EU Carbon Levies System,” BLOOMBERG, 6 February 2012; “China Bans Airlines From Joining EU Emissions Scheme,” REUTERS, 6 February 2012.

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Duas mudanças estruturais no comércio internacional viabilizaram esse desempenho favorável das exportações dos PEDs: i) a fragmentação vertical e espacial do processo de produção em “redes de produção globais” altamente integradas; e ii) o aumento no comércio de serviços. Ambos foram possíveis graças a grandes revoluções tecnológicas, apoiadas por reformas multilaterais em políticas comerciais e por uma ampla liberalização no comércio interno e em ambientes de investimento, tanto em países desenvolvidos (PDs) quanto em PEDs. As tarifas médias em países de renda alta diminuíram drasticamente desde os anos 60. Nos Estados Unidos da América (EUA), por exemplo, a tarifa aplicada média para países mais favorecidos (MFN, sigla em inglês) foi reduzida pela metade para atingir 10% nos anos 90 e ser uma vez mais cortada pela metade nos anos seguintes[1].

Ainda assim, a resposta dos PEDs só começou a surgir no final dos anos 80. Nesse momento, grandes avanços tecnológicos – particularmente no setor de transportes (remessa de contêineres) e tecnologia da comunicação – reduziram drasticamente o custo de transporte de bens e da administração de redes complexas de produção. Muitas das tendências que guiam a “terceirização” da produção também contribuíram para a globalização de serviços. Isso inclui mudanças drásticas na tecnologia, transporte e comercialização de muitas atividades de serviço, permitindo que poderosas forças de vantagem comparativa se desenvolvessem. No Sul da Ásia, o setor de serviços é responsável por mais de 50% do crescimento no produto interno bruto (PIB) regional entre 1980-85 e 2000-07[2].

A crise econômica global de 2008-2009 levou à maior queda do comércio internacional desde a Segunda Guerra Mundial, com uma queda simultânea dos fluxos de comércio em todas as regiões do mundo no quarto trimestre de 2008. O comércio global caiu 12% em 2009, com alguns países registrando quedas ainda mais pronunciadas (ver Gráfico 1): as exportações japonesas, por exemplo, caíram nada menos que 50% entre fevereiro de 2008 e fevereiro de 2009. No entanto, o fato de que quatro grandes países emergentes (Brasil, China, Índia e Indonésia) lograram apresentar taxas de crescimento positivas nos fluxos de comércio entre 2007 e 2009 pode ser identificado como o marco de uma nova ordem no comércio internacional, na qual países emergentes de rápido crescimento mostram resistência a flutuações na atividade econômica[3].

O bom desempenho desses países ajuda a explicar a rápida recuperação sem precedentes dos fluxos comerciais que se iniciou já em 2009. Mais importante, ao contrário do que muitos esperavam quando do início da crise, o recurso a medidas protecionistas como forma de enfrentar a crise foi em boa medida contido, mostrando que as regras do sistema multilateral de comércio funcionaram. Na verdade, as medidas de tendência protecionista adotadas têm sido, em geral, consistentes com as regras estabelecidas pela Organização Mundial do Comércio (OMC), na medida em que utilizam mecanismos de proteção temporária[4].

As perspectivas para os próximos anos

Apesar da recuperação dos fluxos de comércio no período pós-crise, a evolução recente mostra sinais de desaceleração, acompanhando as incertezas sobre a recuperação econômica global. De fato, o comércio internacional tem perdido força desde meados de 2011. A desaceleração é mais notada em países de alta renda. A demanda de importação na zona do euro diminuiu no terceiro trimestre de 2011, com importações caindo 4% na França e na Alemanha, comparadas com o segundo trimestre de 2011. No mundo todo o transporte de cargas pelo ar vem declinando desde junho de 2011. Por fim, o transporte intercontinental de navios (um importante indicador de comércio) tem revelado um crescimento relativamente estável desde a grande queda no início de 2009, mas sem nenhuma evidência de nova redução. De todo modo, como indica o Gráfico 2, a evolução do comércio no episódio atual da crise nem de longe se parece com o que ocorreu em 2008-09.

A evolução futura do comércio global será ditada, sem dúvida, pelo ritmo de recuperação da economia mundial. Como se sabe, o ímpeto da retomada pós-crise não se sustentou e hoje as perspectivas de crescimento global seguem incertas. Enquanto as perspectivas de crescimento global seguem ancoradas no robusto crescimento das grandes economias emergentes e, em menor medida, na recuperação da economia dos EUA, a grande incerteza segue sendo a crise europeia e seus desdobramentos. Embora as recentes medidas adotadas pelo Banco Central Europeu tenham reduzido sensivelmente a temida possibilidade de um credit crunch – o que teria consequências potencialmente desastrosas para a recuperação da produção e do comércio mundiais –, a verdade é que há crescente preocupação com os problemas de solvência de bancos e governos na Europa. Um processo de desalavancagem bancária na região está em curso, com consequências para toda a economia global – inclusive através do encolhimento de do setor de financiamento ao comércio (trade finance). Ainda que o cenário mais provável seja o de administração dos problemas europeus, a incerteza associada aos elevados níveis de endividamento na periferia da área do euro podem constituir obstáculos significativos ao crescimento, dada a interdependência com os demais blocos de países[5].

Na verdade, estamos vivendo ainda os desdobramentos da grande crise de 2007-08, a qual esteve longe de ser apenas uma recessão severa, tendo na verdade se caracterizado por um colapso sincronizado nos mercados de crédito, imóveis e ativos, como notaram diversos autores[6]. Na verdade, a expansão precedente – ainda que insustentável – revelou mudanças estruturais profundas e irreversíveis na dinâmica da economia mundial[7]. Entre essas mudanças, estão o peso e a relevância muito maiores de vários países do mundo em desenvolvimento no crescimento e no comércio mundiais.

Os desafios para os PEDs

Apesar deste ambiente de incerteza, algumas tendências observadas nas últimas décadas no comércio global – particularmente importantes para os PEDs – não devem mudar. A primeira delas é o crescente peso das relações Sul-Sul. As importações dos PEDs de seus pares chegam agora a nada menos que 45% do total. Isso tem sido determinado em boa medida pelo crescimento dos países emergentes (a China em particular), e essa tendência só deve ser reforçada nos próximos anos. O ponto importante a notar é que esses mercados vêm se tornando uma alternativa para os países mais pobres, tradicionalmente dependentes dos mercados ocidentais mais desenvolvidos. De fato, o peso dos países emergentes cresceu de 20% para 32% do comércio dos países mais pobres na última década.

O crescente peso das cadeias produtivas globais no comércio internacional deve seguir sendo uma importante característica do comércio[8]. Na verdade, essa tendência tem sido reforçada no período mais recente com a transferência de centros de inovação para alguns grandes países emergentes – com destaque para China, Índia e, mais recentemente, Brasil. Esse processo de mudança na “geografia da inovação”[9] parece ter origens distintas dependendo dos países de atração e, se consolidado, terá consequências importantes para a dinâmica do comércio e crescimento das maiores economias emergentes.

Mais difícil de prever é a evolução futura no preço de commodities, que tem sido um fator decisivo para o bom desempenho comercial de diversos países exportadores de recursos naturais. Em 2011, os preços de commodities apresentaram um pico no primeiro trimestre e subsequentemente caíram por conta das perspectivas menos favoráveis de demanda. No ano como um todo, apesar da desaceleração da atividade econômica mundial, enquanto os preços de commodities não energéticas caíram 11%, os produtos de energia mostraram crescimento de 14%. No médio prazo, o acompanhamento dos especialistas do Banco Mundial ainda aponta para uma estabilidade no preço das principais commodities[10].

Em resumo, a incerteza segue dominando as perspectivas para o crescimento e o comércio globais no curto prazo. No entanto, os eventos recentes ilustram que a maioria dos países segue comprometida com a integração comercial como opção estratégica para o desenvolvimento. A manutenção desse compromisso e de políticas macroeconômicas robustas persistirá como um elemento indispensável para a continuidade do bom desempenho das economias emergentes. A médio prazo, estratégias de diversificação, tanto de mercados como de produtos, devem seguir como prioridade na agenda dos PEDs, para melhor administrar os riscos inerentes à integração no comércio global. A resistência do dinamismo no comércio Sul-Sul deverá continuar como uma das dimensões da troca de locomotivas na economia global que se vislumbra no médio prazo[11].

* Vice-presidente da Rede de Política Econômica e Redução da Pobreza (PREM, sigla em inglês) do Banco Mundial.
** Economista principal do Departamento de Comércio Internacional do Banco Mundial.

[1] Ver: Reis, J. G.; Farole, T. Exports and the Competitiveness Agenda: policies to support the private sector. In: A Handbook on the Future of Economic Policy in the Developing World. The World Bank, 2010, capítulo 5.

[2] Ver: Ghani, Ejaz. The Services Revolution in South Asia. New Delhi: Oxford University, 2010.

[3] Conforme notado por Haddad, M.; Shepherd, B. Managing Openness: trade and outward-oriented growth after the crisis. The World Bank, 2011.

[4] Ver: Canuto, O.; Haddad, M.; Hansen, G. (2010). Export-led growth v2.0. In: Economic Premise, No.3, The World Bank, mar. 2010. Disponível em: www.worldbank.org/economicpremise. Ver também: Haddad e Shepherd, 2011.

[5] Ver: Canuto, O.; Leipziger, D.; Pinto, B. The challenges of Growth. In: Canuto, O.; Leipziger, D. Ascent After Decline: regrowing global economies after the great recession. The World Bank, 2012.

[6] Entre eles, destaca-se o trabalho de Rogoff, K. The Second Great Contraction. Project Syndicate, ago. 2011. Disponível em:www.project-syndicate.org.

[7] Como observado por Canuto, Leipziger e Pinto, 2011.

[8] Ver: Canuto, O.; Dutz, M.; Reis, J. G. Technological Learning: climbing a tall ladder. In: Canuto, O.; Giugale, M. (orgs.). The Day afterTomorrow: a handbook on the future of economic policy
in the developing world, 2010, capítulo 3.

[9] Ver: Arbache, J.; Goldstein, A. Investimentos em inovação pelas multinacionais no Brasil. Trabalho apresentado no seminário sobre inovação, Rio de Janeiro, out. 2011.

[10] Ver: Mitchell, D.; Aldaz-Carroll, E. Structural Changes in Commodity Markets: new opportunities and policy challenges. In: Haddad, M.; Shepherd, B. Managing Openness: trade and outward-oriented growth after the crisis. The World Bank, 2011, capítulo 20.

[11] Ver: Canuto, O. Recoupling or Switchover? Developing Countries in the Global Economy. In: Canuto, O.; Giugale, M. (orgs.). The Dayafter Tomorrow: a handbook on the future of economic policy
in the developing world, 2010, capítulo 1.

Mais notícias do Pontes

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In appealing a panel ruling from July 2011 (see Bridges Weekly, 6 July 2011), China had challenged the panel’s finding that Beijing’s export restrictions could not be justified as resource conservation or environmental protection measures, or as a way to manage critical supply shortages.

While a victory for the US, EU, and Mexico as co-complainants had largely been expected, the ruling provides some clarifications that could have landmark value in future cases.

Beijing has established a system of export duties and quotas for a number of raw materials, including coke, zinc, and bauxite, as well as some that are only available in China. The resulting high export prices and limited supply impact foreign steel, aluminium, and chemical industries, and their downstream clients.

The EU estimates Chinese export prices are between 50 and 100 percent higher than domestic prices, affecting four percent of the EU’s industrial activity and approximately 500,000 jobs.

“This final ruling is a great success in our efforts to ensure fair access to the much needed raw materials for EU industry,” EU Trade Commissioner Karel de Gucht said in a statement. “It sends a clear signal that such measures cannot be used as a protectionist tool to boost domestic industry at the expense of foreign competition,” he added.

US Trade Representative (USTR) Ron Kirk similarly welcomed the ruling as a “tremendous victory.”

“Today’s decision ensures that core manufacturing industries in this country can get the material they need to produce and compete on a level playing field,” he said.

Resource depletion is not critical; no justification

While the complainants portrayed the restrictions as protectionist measures, China had maintained that they were necessary to conserve the finite resources and to ensure domestic supply, as some of the resources face depletion in the near future. The Appellate Body confirmed the panel ruling when rejecting these justifications.

In times where resource-rich developing countries are increasingly eager to maintain their resources for domestic production, the EU, US, and other WTO members had anxiously sought clarification from the global trade arbiter on the issue.

In evaluating this concern, the WTO’s highest court, for the first time ever, addressed WTO rules on export restrictions taken with the aim of managing critical shortages of essential products.

Article XI 2(a) of the WTO’s General Agreement on Tariffs and Trade (GATT) provides that the general prohibition of quantitative restrictions, including bans and quotas, shall not apply where they are taken temporarily to prevent or relieve a critical shortage of foodstuff or other essential products.

This provision’s relationship with another section of the GATT, Article XX - which establishes a number of justifications for otherwise illegal measures, on the basis of greater public policy objectives, such as public health or resource conservation - was particularly controversial, as China argued that the foreseeable depletion of finite resources was indeed a critical shortage.

Unlike Article XX(g) on resource conservation measures, Article XI 2(a) does not require that external measures be linked with restrictions on domestic production and consumption.

During the proceedings, China had argued that the Article XI 2(a) exception should also apply to long-term preventive measures. The Appellate Body disagreed, however, deeming that Article XI 2(a) only “applies in the interim, to provide relief in extraordinary conditions in order to bridge a passing need.”

It further noted that “if a measure were imposed to address a limited reserve of an exhaustible natural resource, such measure would be imposed until the point when the resource is fully depleted.” This scenario would make it impossible for an export restriction to relieve or prevent a shortage, the judges explained.

The finding that general resource conservation efforts do not permit export restrictions through Article XI 2(a) is likely to shape global trading patterns in essential raw materials in the coming decade. This is particularly true for trade in the highly precious rare earths materials - another subject that has lately generated heated debate between China and its trading partners.

De Gucht has already called upon China “to bring its overall export regime - including for rare earths - in line with WTO rules.”

Article XX no fall-back option

Another matter before the Appellate Body was the applicability of Article XX to claims based on paragraph 11.3 of China’s accession protocol, which obliges China to eliminate all its export duties. The dispute panel had denied the article’s applicability, a ruling which the Appellate Body now confirmed.

The Appellate Body ruled that, since Article XX was not specifically addressed in the paragraph in question, there was no basis for the article to apply. “Had there been a common intention to provide access to Article XX, language to that effect would have been included in paragraph 11.3 or elsewhere in China’s accession protocol,” the judges noted.

Whether Article XX is available as a justification for claims brought under agreements other than GATT has long been a subject of debate among trade observers.

Many have argued in favour of using Article XX as a general “fall-back option” in order to resolve questions at the intersection of environment and trade on those grounds, rather than in a fragmented way under individual WTO law provisions. This is an issue of particular relevance to recently acceded countries that have agreed to “WTO+” commitments in their accession protocols.

While the Appellate Body was careful in limiting its analysis to the dispute in question, rather than generally ruling on the applicability of Article XX, the ruling is an important indication for future cases. This is particularly true for the ongoing dispute over the Canadian province of Ontario’s feed-in tariff for renewable energy and its consistency with the WTO subsidy agreement.

For acceding countries, the ruling means that they will have to carefully ensure that Article XX is referenced in all those provisions that they want covered by the article’s justifications for measures taken in the interest of the environment, resource conservation, human health, or public morality - a monumental task.

The alternative would be to incorporate Article XX as an umbrella clause in the accession protocols - an issue that could be very difficult to negotiate.

Referring to these difficulties, Beijing released the following statement on Monday: “China takes the view that the WTO rules, at the time of liberalising trade, allow a member to take necessary means to realise its policy objectives, such as protection of the exhaustible resources and the environment. A solution should be found by balancing different policy objectives.”

Next steps

The panel and Appellate Body reports will go before the Dispute Settlement Body for formal adoption within thirty days. China will then have to bring its measures into compliance within a reasonable period of time.

ICTSD reporting.

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“We need to do more” on China, Obama says

The US President, addressing a joint session of Congress in his speech on Tuesday 24 January, promised to “go anywhere in the world to open markets for American products,” adding that he would be sure to hold the US’ trading partners to international trade laws.

“I will not stand by when our competitors don’t play by the rules,” Obama said.

The US and China have seen trade tensions escalate over the past year, with Washington and Beijing engaging in a tit-for-tat row that has covered a broad range of issues, from China’s valuation of its currency, to antidumping claims at the WTO, to both countries’ support of their respective renewable energy sectors.

“Over a thousand Americans are working today because we stopped a surge in Chinese tyres,” Obama said, referring to a WTO dispute in which China had unsuccessfully challenged safeguard measures levelled by Washington on Chinese tyre imports (see Bridges Weekly, 7 September 2011).

“But we need to do more. It’s not right when another country lets our movies, music, and software be pirated. It’s not fair when foreign manufacturers have a leg up on ours only because they’re heavily subsidised,” he added.

In his address, Obama confirmed earlier reports that he would be establishing a Trade Enforcement Unit that would be tasked with investigating “unfair trade practices in countries like China,” along with promising more border inspections to prevent imports of counterfeit or unsafe goods (see Bridges Weekly, 11 January 2012)

Russia also on the agenda

The US President also appeared to make a subtle call for Congress to move forward on restoring permanent normal trade relations with Moscow, stressing that “this Congress should make sure that no foreign company has an advantage over American manufacturing when it comes to accessing finance or new markets like Russia.”

Russia’s 18-year bid for WTO membership was approved at the WTO’s Eighth Ministerial Conference in December, with its full membership set to come into effect later this year once the Russian parliament ratifies its accession package (see Bridges Daily Update, 18 December 2011).

However, the US still lacks permanent normal trade relations with Russia, as the result of a Cold War-era provision that allows Washington to deny most-favoured nation (MFN) status to nations with limited freedom of emigration.

The legislation - known as the Jackson-Vanik amendment - would need to be repealed by the US Congress in order for permanent normal trade relations to be restored. Obama has stressed in recent months that taking Jackson-Vanik off the books in 2012 is a White House priority.

Just last week, Russian Foreign Minister Sergei Lavrov told a news conference that the US must repeal the law, or else Russia would “not abide by the commitments it undertook as a WTO member if the Jackson-Vanik amendment remains in force.”

White House promises to develop “every available source” of energy

In his speech, Obama also made a pitch for developing an energy strategy that would open more than 75 percent of the US’ potential offshore oil and gas resources, while also developing natural gas and increasing Washington’s backing of renewable energy.

“The development of natural gas will create jobs and power trucks and factories that are cleaner and cheaper, proving that we don’t have to choose between our environment and our economy,” the US President promised.

Obama also urged Congress that it was time to “double-down” on the clean energy industry. “I will not cede the wind or solar or battery industry to China or Germany because we refuse to make the same commitment here.”

While the US recently retook the top position in investment in clean energy - surpassing China - US solar panel producers have struggled to keep up against cheap solar imports from China and sharp decreases in the price of solar panels (see Bridges Trade BioRes, 23 January 2012 and Bridges Weekly, 16 January 2012).

The buzz around finding new sources for the US’ energy needs reached new heights over the past week, after Obama’s 18 January announcement rejecting a plan for the building of a multi-billion dollar pipeline that would have carried crude oil from Canada to the US state of Texas, faulting Republicans for having imposed an “arbitrary” deadline for the project’s approval (see Bridges Weekly, 18 January 2012).

However, in last week’s announcement, Obama made clear that the decision was “not a judgement on the merits of the pipeline,” potentially leaving the door open for the project to move forward at a later date.

The proposed pipeline had been the subject of weeks of debate on its environmental and economic implications. Opponents had called the Keystone project environmentally irresponsible, citing concerns over the proposed pipeline’s carbon footprint, among others. Meanwhile, supporters - which include many Republicans - had argued that the project was key to creating US jobs and increasing the US’ energy resources.

US “on track” to double exports

In his speech, the US President also highlighted progress toward the goal he set at the 2010 State of the Union address, in which he promised to double US exports within five years - from US$1.57 trillion in 2009 to US$3.14 trillion by 2015 - in an effort to create new jobs.

“Two years ago, I set a goal of doubling US exports over five years. With the bipartisan trade agreements I signed into law, we are on track to meet that goal - ahead of schedule,” Obama said, referring to the US’ free trade agreements with Colombia, Panama, and South Korea.

The three trade pacts had been the subject of prolonged political debate between parties for years, having been signed into law by former US President George W. Bush in 2007.

The FTAs were ratified by the US Congress and signed into law this past autumn (see Bridges Weekly, 12 October 2011).

Republican presidential candidates respond

The State of the Union address drew harsh rebukes from Republican presidential candidates, who hit back at Obama’s economic and energy policies in their responses.

With the US presidential election scheduled for the first Tuesday in November, Republican candidates have spent the past several months jockeying for position in the contests for their party’s nomination. Last Friday’s primary in the US state of South Carolina saw former House Speaker Newt Gingrich beat out former Massachusetts Governor Mitt Romney - until then widely seen as the party’s frontrunner - by a wide margin in the polls, refocusing much of the national attention on the escalating rivalry between the two candidates.

“I will open up new markets for American goods, and open up our lands so that we can finally develop our energy resources,” former Massachusetts Governor Mitt Romney promised in his pre-rebuttal remarks.

“My administration will support the development of these resources, not find excuses to stand in the way,” the former governor added, pledging both to take advantage of a “revolution in drilling for natural gas” and to approve the Keystone oil pipeline should he win office.

Gingrich, in his response to Obama’s address, also took aim at the White House decision to reject TransCanada Corporation’s proposed pipeline.

“Only recently the president cancelled the Keystone XL Pipeline that would have created countless new jobs and helped America on the way to energy independence because he wanted to appease the far left of his party,” the former House speaker said. “And yet not a single word on the Keystone XL pipeline tonight.”

The four-man race for the Republican Party nomination next moves to the US state of Florida, with a primary scheduled for Tuesday 31 January.

ICTSD reporting; “Russia threatens to ignore WTO commitments in trade with US if Cold War law isn’t scrapped,” ASSOCIATED PRESS, 18 January 2012.

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“Law and order in rare earth exploration and production and environmental protection are taking a turn for the better,” China’s Ministry of Commerce said of the 2012 policy.

Beijing says the new conditions are a reaction to China’s concerns over the environmental impact of its massive rare earths production facilities. But with the materials being essential to advanced manufacturing and necessary components for modern technologies like hybrid car batteries, lasers, wind turbines, and guided missiles, critics contend that Beijing is also interested in keeping global prices high and protecting domestic access.

Countries with advanced industries have been particularly vocal about the export restrictions. The EU, Mexico, and US have already taken similar Chinese restriction measures on raw materials to WTO dispute settlement where China’s claim for an exception on environmental and resource conservation grounds was unsuccessful in front of the panel (see Bridges Weekly, 6 July 2011). As the appellate report in this case (China - Raw Materials) is pending, rare earths importers will soon have some insight into how such environmental measures will fare under WTO law.

Unprecedented price fluctuations in 2011

China supplies over 97 percent of the world’s rare earths, with one company - Baotou Steel Rare Earth Hi-Tech - singlehandedly responsible for more than half of this. China is also the lone source for all of the most precious “heavy” rare earths.

When Beijing in 2010 slashed the export quota of rare earths from 45,490 tonnes to 27,449 tonnes, major manufacturers dependent on the exports voiced concern (see Bridges Trade BioRes, 8 November 2010). In response to the limited quota and other global events, prices rose until summer 2011 when they reached an all-time high.

But since mid-2011 prices have been plummeting due to decreased demand brought on by the lasting economic crisis, slowed industrial production after the Japanese Tsunami, and China’s decision to release rare earths stockpiles. Baotou Steel - which is state owned - even stopped production for one month in order to ease the market (see Bridges Trade BioRes, 31 October 2011).

The impact of the newly-released 2012 quota is expected to be less severe as it provides for increasing quotas throughout 2012. However, according to data reported by the Financial Times, the quota for the first half of 2012 is down 27 percent with almost two-thirds of allocations pending approval because of the new environmental compliance rules. Baotou Steel, for example, is not yet in compliance.

Thus, much depends on the companies’ reactions as exports will shrink if industry fails to meet environmental regulations.

Dominance in rare earths is not a matter of geological coincidence. For example, China is gifted with only 37 percent of the world’s known reserves. China gained its large market share by consistently having the cheapest product at a time when strict environmental regulation over rare earths mining and refinement was driving up costs in other countries. But China has been signalling to the world in recent years that it is willing to make tough decisions to tackle its environmental problems. With rare earth mining and refinement being a toxic, even radioactive, process the move is not completely out of line with its declared ambitions.

The green side of the debate

The new quota has been interpreted by many experts as evidence that China is willing to take steps toward a more sustainable rare earths industry by requiring compliance to get quota. In 2010, the country’s Ministry of Environmental Protection conducted a crackdown on illegal rare earths mining. Last year, the Ministry restricted new rare earths projects to those companies listed as passing an environmental protection check. Now, Beijing says the new measures offer more oversight over environmental degradation by withholding quota allocation for failure to meet recent regulations such as the Standards on Pollutant Discharge of the Rare Earth Industry.

While Beijing insists that their policy is environmentally driven, rare earths importers point to the fact that a tight quota has potential benefits for Chinese business. Lower exports can keep commodity prices high, provide a stable supply for domestic users, and entice foreign manufacturers - along with jobs and investment - to relocate to China for easier access.

Further complicating the issue is the fact that China’s 2012 policy also distinguishes between more accessible light rare earths and the highly coveted heavy ones, giving only about 15 percent of the entire quota to the latter.

Thus, even if China’s quota has a genuine environmental objective in part, importers will likely continue to struggle with Beijing’s 2012 rare earths policy. However, by conditioning quota allocation on environmental compliance, China’s rare earths system already shows higher environmental considerations than what it does for other raw materials. The upcoming Raw Materials appeal will serve to inform whether these measures qualify under what members can and cannot do in managing natural resources even if the decision does not translate into a WTO dispute on rare earths.

ICTSD Reporting; “MOFCOM Answered Questions by Reporters Concerning First Batch of Rare Earth Export Quotas in 2012,” Ministry of Commerce, People’s Republic of China, 30 December 2011; “After China’s Rare Earth Embargo, A New Calculus,” The New York Times, 29 October 2011; “The Battle over Rare Earth Metals, Journal of Energy Security, 12 January 2010; “China Rare Earths Move Unlikely to Buoy Prices,” Financial Times, 29 December 2011.

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In describing the plan on Friday, Obama underscored that reforms were necessary for the government to keep up with the needs of a “21st century economy” by reducing inefficiencies and redundancies in the current set-up.

The Executive Branch formerly had authority to “fast-track” government reorganisation, in which the President could merge agencies and submit the changes to an up-or-down vote by Congress; this authority ended in 1984.

The agencies that would first be targeted by such reform would include the US Department of Commerce’s core business and trade functions, the Small Business Administration, the Office of the US Trade Representative, the Export-Import Bank, the Overseas Private Investment Corporation, and the US Trade and Development Agency

Under the Obama plan, all six agencies would be housed under the same roof. The White House argues that the merger could save US$3 billion and result in reductions of 1,000 to 2,000 jobs, mostly through attrition.

Without further details, it would be difficult to tell what form such a merger might take, WorldTradeLaw.Net President Simon Lester commented.

“My guess is that they’re not looking to make a major change in the way US trade governance works,” he continued, adding that such changes could still be possible.

In the past year, the Obama administration has pushed trade higher up on the White House agenda, spending the summer and autumn months pushing for the ratification of the long-awaited South Korea, Colombia, and Panama free trade agreements - which became law in October after years of political wrangling - and promoting the proposed Trans-Pacific Partnership agreement.

The agency merger is also key to the goal of increasing US exports and therefore creating jobs, the White House says. The Obama administration has set a goal of doubling US exports in five years - from US$1.57 trillion in 2009 to US$3.14 trillion by 2015.

With the US presidential election set for November of this year, many observers have questioned whether Obama’s announcement is more of an election year gambit - given that reducing the size of the federal government has long been a key issue for the opposition Republican Party - or a real effort to streamline the government.

“My sense is that it’s more about domestic politics,” Lester said.

Congressional committees, industry groups weigh in

The announcement was quick to draw responses from lawmakers and industry groups, many of which questioned what such a merger might mean for US trade policy.

Senate Finance Committee Chairman Max Baucus, a Democrat from the US state of Montana, and House Ways and Means Committee Chairman Dave Camp, a Republican from the US state of Michigan, issued a joint statement on Friday expressing qualms over the proposal.

“While we welcome the ability to reduce duplication and streamline government services, we are concerned about the impact that the President’s proposal could have on the ability of the United States to aggressively open new markets to American-made goods and services and create US jobs,” they said.

Industry groups also expressed scepticism over whether such a proposal would even make it through Congress, with the National Foreign Trade Council stressing that the US legislative branch has “historically been reluctant to combine USTR with other functions, preferring to have our chief trade negotiator concentrate on negotiating rather than be burdened with broader programmatic responsibilities.”

Election year difficulties

Gary Hufbauer, senior fellow at the Washington-based Peterson Institute for International Economics, also found that such a proposal might struggle to make it through Congress in an election year, given that the various agencies that Obama wishes to reorganise currently report to different committees on the Senate and House side.

For example, the US Department of Commerce reports to the Commerce committees of the two legislative chambers, while the Senate Finance and House Ways and Means Committees jointly have oversight over the Office of the USTR.

“The problem is that, if you combine them into one unit, who in Congress gets oversight on that?” Hufbauer asked.

The potential conflicts in Congress over which committees would have jurisdiction over this new proposed trade agency could make it difficult for this reorganisation to happen before the 2012 presidential election.

“The real test is, if [Obama]’s re-elected, whether he pushes for it in 2013,” he added.

Washington-based trade lawyer Scott Lincicome also underscored the potential challenges Obama might face in getting Congress to sign off on the proposal.

“To reorganise these agencies, because of their different mandates, because of their different structures, would require a pretty significant lift by Congress and a lot of co-operation between administration and Congress - and do we really expect that in an election year?” Lincicome noted.

“Even in the best of years, it would be difficult,” he continued.

After the authority expired in the mid-1980s, other US presidents also asked for such reorganisation authority - requests that did not make it far. “It’s not a radically new suggestion - it’s been put out there before,” WorldTradeLaw.Net’s Lester commented.

Trade negotiation, litigation - who has authority?

Some trade observers have also raised questions as to what the merge might mean for the USTR’s role as a trade litigator and negotiator, should the Department of Commerce and the USTR indeed be placed under the same roof.

Noting the potential tensions that could come from having the Commerce Department and USTR in the same house, Lincicome stressed that “the big question in my mind is who is really the more dominant force in the new agency. Is it going to be the Department of Commerce, or is it going to be the USTR?”

The Office of the US Trade Representative (USTR) is the US’ lead trade negotiator, and handles the US’ trade litigation at the WTO. Trade litigation within the US, however, is handled by the US Department of Commerce, whose focus has traditionally centred more on export promotion.

Former USTR Susan Schwab, who held the post from 2006 to 2009, told Bloomberg that “you want from the Commerce Department a full-throated unapologetic advocate for the US industry. You don’t want an agency that has to pull its punches.”

However, one trade lawyer speaking to Bridges predicted that the proposed merger would not cause changes in either the US’ trade negotiation or international trade litigation, noting that “the vast majority of countries do both from a single ministry.”

Meanwhile, House Ways and Means Committee Ranking Member Sander Levin, a Democrat from the US state of Michigan, has argued that having the USTR as a small, specialised agency has its advantages.

Levin, responding to the announcement, underscored that “Congress established the Office of the US Trade Representative, within the Executive Office of the President, because our trade objectives were not adequately negotiated, implemented or emphasised when trade negotiators and enforcers were part of a broader agency.”

According to the White House, the USTR would not lose its Cabinet-level rank under such reorganisation.

Even with these assurances, however, many question what role the head of the new entity might have - whether he himself would take on the role of the US’ lead trade negotiator, or whether there would be a separate US trade negotiator that would be subordinate to him.

“It doesn’t seem to me to make any sense unless [the new agency chief] is chiefly a trade negotiator,” Hufbauer cautioned.

“If the top trade negotiator is subordinate to him, then you get the top trade negotiator going and having to say, in some language or another, that he wouldn’t be able to make a decision himself and would have to report back [to Washington].”

ICTSD reporting; “Obama’s Reorganization Raises Concerns About Trade Effectiveness,” BLOOMBERG, 14 January 2012; “Obama wants export agency, closing of Commerce Department,” REUTERS, 13 January 2012; “Commerce revamp could weaken trade policy,” WASHINGTON POST, 14 January 2012.

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The inclusion of aviation in the scheme went into effect on 1 January. Under the EU scheme, all airlines - regardless of nationality - will be required to surrender emission permits for intra-EU flights, as well as flights to and from the EU bloc. For inter-regional flights, emissions are calculated for the entire last ‘leg’, which naturally results in higher costs for transatlantic and other long-distance flights.

Brussels has insisted that including all airlines is key for the scheme’s success, specifically by reducing possibilities of carbon leakage. Otherwise, the reduction of emissions by EU airlines could end up being offset by an increase in emissions by non-EU airlines.

The court’s December decision received a warm welcome from EU Climate Commissioner Connie Hedegaard. “I am of course very satisfied to see that the Court clearly concluded that the EU Directive is fully compatible with international law,” she said.

“A number of American airlines decided to challenge our legislation in court and thus abide by the rule of law. So now we expect them to respect European law,” Hedegaard continued.

Airlines that do not comply with the EU ETS could potentially be banned from EU airports, the European Commission said last week. However, the Commission is “confident” that companies will comply, Isaac Valero-Ladrón, the commission’s spokesman for climate action, told reporters in Brussels on Thursday 5 January.

Any ban against noncompliant airlines would only be measures of last resort, he added. The initial penalty for non-compliance would be a fine of €100 per tonne of carbon dioxide that has not been accounted for under the EU system. “The penalties for noncompliance are much higher than compliance,” Valero-Ladrón explained, according to the New York Times.

Court agrees with Advocate General: measure fully compatible with international law

The ruling follows the October release of an official opinion by ECJ Advocate General Juliane Kokott, which similarly suggested that the EU plan was indeed compatible with international law (see Bridges Weekly, 12 October 2011). Advocate General opinions are non-binding but are meant to inform the court, which usually follows the recommendations.

The lawsuit was brought in front of the court by the Air Transport Association of America - now known as Airlines for America - along with American Airlines, Continental Airlines, and United Airlines.

After dismissing the Chicago Convention - of which the EU itself is not a member (despite all EU member states being signatories) - and the Kyoto Protocol as a basis for claims, the court examined the legality of the inclusion of aviation in the ETS scheme in the light of customary rules relating to the sovereignty over airspace and the freedom of the high seas, as well as the 2007 Open Skies Agreement between the US and the EU.

ETS not in violation of state sovereignty, court finds

Two claims took centre stage in the case: the questions of whether the inclusion of flight passages outside of European airspace had an extraterritorial effect and of whether the emission charges constitute a charge on fuel or a limitation to the frequency of traffic.

Regarding the extraterritorial effect, Airlines for America had argued that the inclusion of flights taking place in the airspace of third countries was a violation of the state’s sovereignty over their airspace and in violation both of the freedom to fly over the high seas and the prohibition for states to claim sovereignty over any part of the high seas.

However, the judges clearly rejected this view: “It is only if the operator of an aircraft has chosen to operate a commercial air route arriving at or departing from an aerodrome situated in the territory of a member state that the operator, because its aircraft is in the territory of that member state, will be subject to the allowance trading scheme.”

Once within the EU’s jurisdiction, it is up to EU legislators to decide which commercial activity they permit and on what condition, particularly when these activities are designed to fulfil the EU’s environmental objectives, the thirteen judges further ruled.

Emissions levy not a tax on fuel nor discriminatory

The Grand Chamber equally disagreed with Airlines for America that the levies constituted a tax, duty, fee, or charge on fuel, despite fuel consumption being the basis of the formula that enables the calculation of emissions.

“There is no direct and inseverable link between the quantity of fuel held or consumed by an aircraft and the pecuniary burden on the aircraft’s operator in the context of the allowance trading scheme’s operation,” the judges found.

In the view of the ECJ, it cannot be ruled out that an operator, despite having held or consumed fuel, experiences no burden through the ETS or even makes a profit.

Regarding the potentially air traffic-limiting character of the measure and its non-discriminatory nature, the judges finally noted that the ETS did not set a limit for aircraft emissions, thereby not restricting air traffic. Even if it did, however, this would be justified on the basis of being a non-discriminatory environmental measure.

Referring to Kokott’s discussion, the court agreed that there was no discriminatory treatment of EU and non-EU aircraft operators, as every operator was subject to the ETS in the same way.

The court did not examine WTO law, as the WTO’s own adjudicative system has exclusive jurisdiction in this area. Airlines for America had also not made any claims in this regard. With the ECJ’s rejection of the claims, however, a WTO case could become more likely as foreign aircraft and potentially their home states look for other legal remedies.

The ruling marks the last step in the road for the lawsuit under the ECJ’s jurisdiction; the case will now return to the UK High Court, which had requested the ECJ to rule on the legality of the EU Directive after Airlines for America had challenged the UK’s implementation thereof. EU Member States may not determine the legality of EU law themselves, but respective questions are referred to the ECJ.

Airline groups consider alternate legal options; environmental groups laud ruling

The ECJ decision was promptly lambasted by Airlines for America, a claimant in the dispute. The industry group’s members and affiliates represent more than 90 percent of US airline passenger and cargo traffic.

In a statement following the ruling, Airlines for America underscored its frustrations with the decision. “Today’s court decision further isolates the EU from the rest of the world and will keep in place a unilateral scheme that is counterproductive to concerted global action on aviation and climate change.”

The group also argued that the European court “did not fully address legal issues raised,” adding that the decision sets “a damaging and questionable precedent by ruling that the European Union can ignore the Chicago Convention and other longstanding international provisions that have enabled governments around the world to work cooperatively to make flying safer and more secure, and to reduce aviation’s environmental footprint.”

Meanwhile, environmental groups have been quick to rally behind the decision. Annie Petsonk, International Counsel for the US-based Environmental Defense Fund, stressed that it was “high time [that] airlines actually live up to their green claims, and comply with the EU law, which will cut pollution and spark low-carbon innovation. Americans invented the airplane, now it’s time for us to create climate-friendly skies.”
Bill Hemmings, Programme Manager at Transport & Environment, echoed that sentiment. “The news for airlines? The European Court has written your New Year’s Resolution for you: ‘We agree to join other responsible industries and start polluting less’.”

China, US response

The inclusion of airlines into the EU plan has also come under heavy fire from various non-EU countries: at a 2 November meeting in Montreal, the International Civil Aviation Organization (ICAO) adopted by a majority vote a paper asking that foreign carriers not be subject to the EU scheme.

The UN group’s working paper was backed by 26 of the ICAO’s 36 member states - including China, Japan, Russia, and the US. The paper called the inclusion of aviation in the EU scheme a violation of “the cardinal principle of state sovereignty” outlined in the Convention on International Civil Aviation (also known as the Chicago Convention). (See Bridges Weekly, 9 November 2011).

After the ECJ ruling, the US made clear that it continues to oppose Brussels’ plan. “We continue to have strong legal and policy objections to the inclusion of flights by non-EU air carriers in the EU ETS,” Krishna Urs, deputy assistant secretary for transportation affairs at the US Department of State, said in a statement.

US officials are also reportedly considering taking retaliatory measures or pursuing legal action against the EU, according to Reuters.

Meanwhile, Chinese airlines are threatening not to pay the charges under the EU scheme.

“China will not cooperate with the European Union on the ETS, so Chinese airlines will not impose surcharges on customers relating to the emissions tax,” Cai Haibo, deputy secretary-general of the China Air Transport Association (CATA), told Reuters last week.

The industry group represents China’s four major airlines: Air China Ltd, China Southern Airlines, China Eastern Airlines, and Hainan Airlines. CATA has also hinted at the possibility of initiating legal action of its own.

Meanwhile, Chinese foreign ministry spokesman Hong Lei has called upon Brussels to hold talks with Beijing and other nations that oppose the inclusion of aviation into the EU ETS.

India, which led the 26-nation push at the ICAO against the EU plan, may respond to the ECJ ruling by asking airlines to withhold emissions data, a civil aviation ministry official told Bloomberg.

ICTSD reporting; “China calls on Europe for talks over carbon charge,” BLOOMBERG BUSINESSWEEK, 5 January 2012; “China warns EU of carbon tax ‘trade war’,” FINANCIAL TIMES, 22 December 2012; “Foreign carriers must pay EU carbon fees,” FINANCIAL TIMES, 22 December 2011; “Top EU court rules against N. American carriers in fee dispute,” GLOBE AND MAIL, 21 December 2011; “Europe Stands Firm on Airline Emissions, Raising Fears of a Trade Conflict,” NEW YORK TIMES, 5 January 2012; “U.S. weighs retaliation over Europe aviation law,” REUTERS, 6 January 2012.

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El banano, durante décadas, ha sido un asunto particularmente delicado para el Ecuador en sus negociaciones de comercio internacional. El tema, en su más reciente versión, ha estado a la vanguardia de las negociaciones referentes a la suscripción de acuerdos comerciales regionales entre la Unión Europea (UE) y los países andinos, así como en el contexto de las negociaciones entre la UE y Centroamérica. En tanto que mayor exportador de banano a nivel mundial, Ecuador juega un papel crítico en el establecimiento de los precios mundiales de la fruta. Por otro lado, la UE, siendo el principal importador de banano, es un actor crítico en la determinación de los niveles y las dinámicas de la demanda. Es probable que un acuerdo entre ambas partes tenga un impacto importante en el mercado mundial para el banano y en los relacionados desafíos del desarrollo.

Nuestra investigación se basa en una serie de diálogos sobre políticas y en consultas realizadas por el ICTSD en los últimos quince años y en particular en estos últimos dos años, con ministros, formuladores de políticas y otros actores importantes de los países productores y exportadores de banano. Este trabajo llamó la atención del Ministerio de Coordinación de la Política Económica del Ecuador y constituye los fundamentos para el documento que se presenta a continuación. El Ministerio y el ICTSD facilitaron el diálogo entre el profesor Anania y diversos actores de la industria bananera nacional. Las discusiones con actores del sector privado y público llevaron a la reformulación de algunas de las preguntas principales y al descubrimiento de nuevas rutas de investigación. De esta manera, el profesor Anania ha sido capaz de abordar temas que aún no se han tratado en la literatura existente.

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Join us at our two-day Trade and Development Symposium. The event will be held in Geneva from 16-17 December in conjunction with the Eighth WTO Ministerial Conference. The symposium, entitled Perspectives on the Multilateral Trading system, will feature an array of panel discussions by distinguished experts from around the world representing various institutions, countries. For more information, click here.

Ministerial Conference - News and Analysis

ICTSD will also be preparing Bridges Daily Updates that will outline the state of play of the proceedings and explore any movement on possible negotiations as they unfold.

ICTSD will also be providing regular updates via Facebook and Twitter.