Monday 19 Nov 2018 | 03:03 | SYDNEY
What's happening on

Will geopolitics trump trade?

Geopolitics may be rapidly moving to the forefront in deciding how the US-China trade war will play out. If so, the odds of a rapprochement are dwindling fast. The trade conflict has always been about many things, clouding how different analysts understood it. Initially, it seemed best understood

NAFTA to USMCA – what’s in a name?

What’s in a name? According to US President Donald Trump, it is the difference between the “worst trade deal ever made” – as he called the North American Free Trade Agreement (NAFTA) – and a “wonderful new trade deal” – his reference to the United States-Mexico-Canada Agreement (

Tit-for-tat-for-tit-for-tat

The US is moving quickly to follow through on Trump’s threats to further escalate his trade war with China (now is as good a time as any to say that the trade war has officially started). Last week the US imposed tariffs on US$34 billion worth of Chinese imports, with another US$16 billion to be

Trade is not just about tariffs

Amid the clamour of the current shouting-match about tariffs, two sometimes-forgotten facts in international trade should be noted. First, tariffs are not the only distortion. Second, none of the countries involved in the current battles is without sin when it comes to trade restrictions.

US-China trade: joke’s over

Once entertaining, the Trump administration is becoming unfunny. In less than a week the trade dispute between China and the US has escalated to cover what will quite likely be the entirety of US goods exports to China, and the greater part, if not the whole, of Chinese goods exports to the US

Is Trump ready to bear the cost of a trade war?

Agree or disagree with his conclusions, we owe Hugh White thanks for forcing us to grapple with “the China challenge”. White’s writings have stripped away much of the easy, high-sounding rhetoric about dealing with Beijing and honed in on the central feature of US–China relations in the

Free trade is being deferred but not reversed

This is the first in a three-part series on the future of world trade from a global (part 1), Asia Pacific (part 2) and Australian (part 3) perspective. Is protectionism on the rise? As we moved into 2017 the conventional wisdom was 'yes'. The G20 warned about it in 2016. The annual January

TPP: With one down, can 11 stand?

Reports of the death of the Trans Pacific Partnership (TPP) were exaggerated – or at least premature. Move over a TPP of 12 nations (TPP12) and make way for TPP11, the lower number reflecting the withdrawal of the US from the agreement. When President Trump withdrew the US from the TPP in

Lessons from India on migration’s role in trade policy

Prime Minister Turnbull yesterday carefully signalled a potential India-Australia Free Trade Agreement is not a priority for his government. This comes after the Abbott Government set a very public benchmark for concluding an India-Australia FTA by the end of 2015, an overly optimistic commitment

Why the TPP should be saved

Perhaps there is, as Ross Garnaut has argued, no silver lining to Donald Trump’s economics. But there may be a small silver lining to Trump’s rejection of the Trans Pacific Partnership (TPP) and his embrace of protectionist policies during the campaign. It depends if the response to these helps

Douglass North and the Trans-Pacific Partnership

Now that the terms of the Trans-Pacific Partnership (TPP) have been agreed, the participant countries have to decide whether to ratify the deal. In assessing the benefits, where might we turn for guidance on the economics? First thoughts might go to David Ricardo, father of one of the few ideas

TPP: Australia should bring in China and Indonesia

The negotiators have finally reached agreement on the Trans-Pacific Partnership (TPP). The US Congress might yet be a stumbling block, but the many US interest groups which stand to benefit will influence that outcome. Other TPP countries have to get legislative approval too. Whatever the

TPP: Not worth the risk

After marathon talks, the Trans Pacific Partnership has been sealed. The stage is now set for some fantastic battles to get this through national legislatures. I'll leave it to others to count the numbers. I've written previously about my concerns regarding the TPP, and agreements like it. I won't

Peak box? Global container trade is slackening

In a little-noticed interview, the chief of Panama's Canal Authority concedes that 'the world and the canal were unlikely to ever again see the booming container trade that characterised the 1990s and early 2000s' due to shifting manufacturing patterns and American thrift. Obviously, he has

The secretive TPP: Never again

One aspect of the Trans-Pacific Partnership (TPP) that has come under criticism is the lack of transparency in the negotiating process. Could a more transparent model be used for these kinds of negotiations? In other areas of official decision-making, recent decades have seen a big shift towards

Why Australia needs Austrade

Bruno Mascitelli is editor of the newly released The Austrade Story: Export and Investment Facilitation Under the Microscope. The Australian Trade Commission, or Austrade as it is commonly known, turns 30 in 2016. It came into existence in 1986 as a statutory government agency for export promotion

The TPP and intellectual property rights

Earlier posts have discussed how the Trans-Pacific Partnership (TPP) – if it comes into force – will be part of the process of setting global rules across a wide range of issues, including intellectual property rights. The just-released Harper Competition Policy Review notes the importance

Australia needs a modern and globalised tax system

The Abbott Government will shortly release a discussion paper on the Australian tax system. It will be the first step towards the much anticipated tax white paper. International factors should figure prominently in the white paper — specifically, how to ensure that Australia has a resilient tax

The 'beggar-thy-neighbour' currency wars

Leon Berkelmans is in good company in defending the policy actions which have come to be described as 'currency wars'.  Ben Bernanke gave the same defence of the US Fed's actions while he was Chairman: while low interest rates and 'quantitative easing' (QE) may give the domestic economy an extra

How much is too much? The debt mystery

The 2008 financial crisis left no doubt that ill-considered debt can cause major damage not just to an individual country, but to the global economy. You might think that by now, six years later, balance sheet repair would have taken debt below pre-crisis levels. However, debt burdens are

Is globalisation slowing?

In the decades leading up to the 2008 financial crisis, international trade typically grew much faster than GDP. This reflected increasing global economic integration: tariff barriers were coming down, trade groups (eg. the eurozone, NAFTA, ASEAN) facilitated trade through regulatory simplification

A Chinese canal in Nicaragua?

There is pride in Hong Kong that a local private company is pushing ahead with perhaps the world's largest-ever civil works project, the 280km long, 500m wide Nicaragua Canal. Construction began in December 2014. The South China Morning Post dismisses outside suspicions while modestly describing

Why Peter Thiel is wrong about monopolies

A few weeks ago Sam Roggeveen quoted PayPal founder Peter Thiel, who argued that competition is over-rated and monopoly would enhance innovation. We shouldn't be surprised that business people are in favour of monopoly. In 1776 Adam Smith observed: People of the same trade seldom meet together,

Congress, midterms and the TPP

US mid-terms elections will take place on 4 November, with polls suggesting the Republicans will re-take control of the Senate. President Obama's next steps on the Trans Pacific Partnership (TPP), which his Administration says is the key economic plank of the rebalance to Asia, will be heavily

The WTO is in big trouble

The Director-General of the World Trade Organisation (WTO), Roberto Azevedo, says the institution has descended into 'paralysis'.  Director-General of the World Trade Organisation, Roberto Azevedo, Bali, 2013. Following the failure to get India to remove its objection to advancing the deal on

China wants a bigger piece of the smartphone business

The smartphone in your pocket embodies today's cutting-edge technology. It is also a product of a global supply chain decidedly old-school in the way it shares rewards. Two brands, Apple and Samsung, scoop over 100% of the profit pool (the other brands are losing money, giving them negative

Australian Customs: A bigger role to play in trade

In a new Lowy Institute Analysis launched today, Nicholas Humphries, the Australian Customs and Border Protection Service Fellow at the Lowy Institute, examines how Customs can increase Australia's trade competitiveness at a time when goods and services are increasingly produced across borders in

Interview: Adam Minter on the Junkyard Planet

Journalist Adam Minter has written a fascinating account of the global rubbish and recycling industry. I recommended his book, Junkyard Planet, as one of my top 'development books' of 2013. Here is part 1 of an interview I am conducting with Adam via email, and below the text a couple of captioned