15.10.2018

CLIPPING INTERNACIONAL NEGINT Brasília, 15 de outubro de 2018

Índice I. OMC _______________________________________________ 2 Can WTO force China to change its trade practices? US ambassador to the organisation is sceptical ___________________________________________ 2 ‘Shaking the Tree’: Trump Call to Quit WTO a Blessing in Disguise Says Bloc Head__________________________________________________________ 5 ‘Indonesia considering "safeguard" tariff on aluminium foil - WTO filing _____ 6 II. NEGOCIAÇÕES REGIONAIS E BILATERAIS _________________ 7 Democrats could control trade deal’s fate _____________________________ 7 III. OUTROS ___________________________________________ 10 El principal interés en la UE es que Brasil no vaya a romper con el Mercosur 10

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I. OMC Can WTO force China to change its trade practices? US ambassador to the organisation is sceptical South China Morning Post (China) Dennis Shea says a drive to revise World Trade Organisation rules may not force Beijing to modify its practices ‘but that doesn’t mean we should not pursue this approach’ Even as the Trump administration pursues revisions to the World Trade Organisation’s rules, its own ambassador to the global trade body is dubious that they will ultimately change China’s behaviour. “We're probably a little more sceptical about the viability of the rules to actually significantly modify China's behaviour,” Dennis Shea, deputy US Trade Representative and ambassador to the WTO, said on Friday. “But that does not mean we should not pursue this approach.” While trade tensions between the world’s two largest economies have mushroomed over the past few months – and as both sides have levied barrages of import tariffs at each other – the US has pursued a series of WTO rule changes intended to force China to end trading practices perceived by many to be unfair. “What the United States really wants is to be judge and jury in all its disputes in the WTO involving the U.S. They want judges to rule in favor of the United States under threat of not being reappointed if they do not,” Bacchus said. The US has joined forces with Japan and the European Union to push for updates to WTO mechanisms that would better challenge China on its use of state subsidies of certain industries and forced technology transfers, as well as its WTO designation as a developing country, which allows China exemptions from certain rules. Representatives from the US, EU and Japan met in September on the sidelines of the UN General Assembly meetings in New York, where they issued a trilateral statement confirming their commitment to pursuing WTO reform.

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Though statements issued by the US Trade Representative about WTO reform have not mentioned China by name, US officials have confirmed that China is the target of the proposed changes. Dealing with China’s non-market economy was “the most important issue of WTO reform”, said Shea, who was speaking at the Centre for Strategic and International Studies in Washington. “And it’s probably the toughest.” US President Donald Trump’s top economic adviser, Larry Kudlow, told CNBC on Friday that the White House was seeking the eradication of non-reciprocal trade practices around the world and for trading powers, including China, to “play by the rules of the WTO, which itself is going to require reform”. “It’s a trade reform effort that, I think, will pay off huge economic growth dividends down the road,” said Kudlow, director of the National Economic Council. Each member of the US-EU-Japan trilateral commitment agreed to achieve domestic consensus on the proposed changes by the end of this year, said Shea. They would then “reach out to other countries – other WTO members – probably early next year”. Shea said that a number of WTO member countries – so-called “friends of the system” – were reluctant to support drastic changes that challenged the status quo of the organisation. “They want to be middle-of-the-roaders, when in fact they really need to pick a lane,” he said, expressing hope that those countries would join in “supporting what we’re trying to achieve there and calling out the problem”. In most cases, changes to the WTO rules require a unanimous vote of its 164 members. Shea said he did not know how China would respond to the proposed changes, but suggested that there had already been preliminary discussions in which China had suggested a tit-for-tat approach to agreeing on reforms. “They are reacting initially saying ‘OK, you throw down industrial subsidies, I’m going to throw down export restraints and investment restrictions,’” he said.

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That significant conversations of changes to the WTO were now taking place was credited by Shea to the Trump administration’s aggressive stance on trade. “The discussion of WTO reform would not have happened but for the disruptive leadership – the disruptively constructive leadership – of the United States,” he said. The WTO’s director general Roberto Azevedo has appeared to welcome Trump’s aggressive push for changes to the organisation, but warned against reforms going too far. “This guy comes along, and he begins to shake the tree pretty hard,” Azevedo said in remarks quoted by Bloomberg on Friday. “So let’s make sure that some fruits fall. Let’s make sure also that you don’t kill the tree by shaking it too hard.” Addressing Trump’s decidedly disruptive threat in August to withdraw the US from the WTO if it did not “shape up”, Shea stopped short of saying that withdrawal would be an appropriate next step for the US, but said he agreed that that urgent reform was needed. “That’s my job at the WTO,” he said. “I’m delivering some difficult messages, hopefully in a friendly way.” Former USTR Carla Hills said that securing any true progress with China would depend on the US taking a diplomatic approach. “I believe that if we joined hands with those like-minded nations and talked in a courteous fashion to China, that we would make better progress than by screaming,” Hills told the South China Morning Post. “You have to understand what some of the problems are at the other side of the table,” Hills, who served as the top US trade negotiator for President George H.W. Bush, said. China is transitioning from a heavy-industry economy to a consumer economy, she said, but its millions of workers at state-owned enterprises could not simply be laid off without having an impact on the country’s growth and stability. “China has its political challenges too,” she said, calling on the US to “try to work through the thicket in a way that you have a win-win situation.”

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‘Shaking the Tree’: Trump Call to Quit WTO a Blessing in Disguise Says Bloc Head Sputnik News (Rússia) US President Donald Trump claims the World Trade Organization (WTO) is biased toward China, resulting in soul searching by member states to remake the bloc’s mandate and methods. Trump has long claimed that the World Trade Organization (WTO), the intergovernmental body that regulates international trade, favors China, since the country joined the organization in 2001. "If they don't shape up, I would withdraw from the WTO," Trump said in an August 30 interview with Bloomberg. It's not clear what topic under discussion led Trump to make the remark. "We're demanding fairness with the World Trade Organization. It's been a disaster for the United States, and we want fairness. We lose court cases. We always had a minority of judges; they gave us fewer judges than other countries had," Trump said in July. "And we'd lose cases — nobody knew why. I said 'I know why: because you don't have judges from this country.' You have a minority. Three to two, with three being on the other side," he said. In January, US Trade Representative Robert Lighthizer claimed that the WTO made a "mistake" by permitting the WTO allow China to join the organization. According

to

WTO

director-general

Roberto

Azevêdo,

Trump's

criticism

of

the

organization has prompted other members, including the European Union and Japan, to call for change. "This guy comes along, and he begins to shake the tree pretty hard. So let's make sure that some fruits fall. Let's make sure also that you don't kill the tree by shaking it too hard," Azevêdo said, cited by Bloomberg.

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Improvement proposals also suggested "plurilateral," sector-specific negotiations that eliminate veto power often used by small WTO members. The EU and Japan are also joining the US to stand up against what they consider to be China's theft of intellectual property, Beijing's deep industrial subsidies and its many state-owned enterprises. In addition, there is a push among WTO members to remove China from the "developing" economy category, which unfairly allows Beijing additional time to comply with certain regulations. The US-Chinese trade war broke out in July after Trump imposed tariffs on some Chinese imports as a means to balance a US-Chinese $500-billion trade deficit. Since that time, the two sides have exchanged several rounds of import duties on each other.

‘Indonesia considering "safeguard" tariff on aluminium foil - WTO filing Reuters (Reino Unido) Indonesia is examining the case for an emergency “safeguard” measure to restrict imports of aluminium foil, it said in a regulatory filing published by the World Trade Organization on Friday. Indonesia

said

industry

association

APRALEX

had

applied

for

safeguard

measures, which can be used to protect a country’s producers from a sudden, unforeseen and damaging surge in imports, and its safeguards committee had decided to consider the case. (Reporting by Tom Miles; Editing by Kirsten Donovan)

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II. NEGOCIAÇÕES REGIONAIS E BILATERAIS Democrats could control trade deal’s fate Politico (Estados Unidos) Congress is unlikely to have the time or political will to approve a new U.S.-MexicoCanada trade agreement by the end of the year — increasing the chances that President Donald Trump will need to bring Democrats on board if he wants to put in place his replacement for NAFTA. Congressional staff members from both parties say there’s little desire to finish the job before the next session of Congress begins in January. “It’s premature to start talking about voting on an agreement before the Congress and the American people even understand the deal’s broad economic effects, or what it means for jobs in the United States,” said Sen. Ron Wyden, ranking member of the Senate Finance Committee. “We are many, many months from having these answers.” Republicans would either have to negotiate an almost insurmountable series of procedural steps to get an up or down vote with a simple majority in the Senate on the deal this year, or they would have to open up the pact to amendments and get at least 60 senators on board. Democrats want to hold the vote next year because they’re hoping they’ll have control of at least one chamber of Congress after the midterm elections in November. “In order to do it, you would have to throw a whole bunch of procedure out of the window and expose yourself politically,” said Bill Reinsch, a trade expert at the Center for Strategic and International Studies. That means the fate of the new pact may rest on whether it appeals to the left. Though U.S. Trade Representative Robert Lighthizer has expressed confidence that the final pact will earn widespread support, there is still healthy skepticism over whether Democrats will support one of Trump’s key policy goals. And there are still questions from Democrats and their labor union backers about how some new provisions would be enforced, particularly when it comes to pushing Mexico to improve worker rights and wages. 7

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Even Trump doesn't know how things will go if Democrats win control the House. “I can['t] tell you whether or not they will obstruct, whether or not they will resist,” the president said in remarks last week announcing the final trade deal. “I mean, their whole campaign is, ‘Resist.’ I see their signs all over: ‘Resist.’ They don’t even know what they’re resisting.” Trying to push the deal through in 2018 — and therefore straying from a process established under Trade Promotion Authority or “fast track” legislation — probably doesn’t rank high on the administration’s agenda, according to sources in Congress and close to Lighthizer. “To be fair, every indication we’ve gotten from USTR has been that they would be looking at a vote in 2019. I think they’d like to do it early in 2019, but 2019,” said a senior Democratic congressional aide. Lighthizer has made a point of following the fast-track process that gives the executive branch authority to make deals on behalf of Congress. Under that law, lawmakers agree to an expedited process for approving a pact with a simple majority in an up or down vote and no amendments, a process the administration will want to use for any future deals. Lighthizer was back on Capitol Hill on Wednesday, fulfilling another of the law’s requirements to consult with lawmakers about the administration’s plans to strike new agreements with Japan, the United Kingdom, the Philippines and the European Union. TPA offers the most assured path to approval, even though a deal must overcome several onerous steps before it can be voted on. Without it, the Senate would have a hard time getting the 60-vote majority to pass a deal. And even if Republicans wanted to push a vote by the end of the year under the expedited process, it’s unclear whether they would be able to speed up all of the steps to get it to the floor of both chambers in time. “All the ducks would have to be lined up in a really straight line and ready to go, and we do not yet really see that,” said another congressional aide close to the process. Senate Finance Chairman Orrin Hatch also does not seem to have interest in circumventing the fast-track timeline.

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“I am working closely with Finance Committee members to review the details of the agreement to ensure that it meets the high standards of Trade Promotion Authority (TPA), and look forward to continuing consultations with the Trump administration,” Hatch said in a statement Thursday. The Trump administration already got in just under the wire on one deadline when it reached a late-night deal with Canada at the very end of September. That allowed for the agreement text to be released for the required 60 days before it is signed at the end of November. The administration has pushed for a signing by that date to allow for departing Mexican President Enrique Peña Nieto to clear it before his last full day in office on Nov. 30. Even now, the text of the agreement is not actually final and is still being reviewed by the three countries through what’s known as a “legal scrubbing” process. Another key step requires the final text to be submitted to Congress 30 days before the introduction of the bill that would implement the changes to laws and regulations required by the new agreement. If Congress wants to introduce the legislation the day after the formal signing, then the scrubbing process, which can normally take months, would have to conclude by the end of October. That would require the administration to submit final text by Nov. 1 to allow for the bill to be introduced Dec. 1. If the submission deadlines weren’t complex enough, the TPA legislation requires the agreement to undergo a full economic analysis by the U.S. International Trade Commission, a quasi-judicial, independent body that often moves at its own pace. The ITC hasn’t formally kicked off its analysis with a required public notice. Commission officials have also resisted past administration requests to speed up their work. The law technically gives the ITC up to 105 days to do its analysis after the deal is signed but leaves open the possibility of starting the study earlier. Experts say the law could technically allow Congress to introduce implementing legislation and even vote on a deal before the analysis is completed — but such a move could risk support from lawmakers who view the study as vital for informing their vote.

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“If they adhere to procedures, it would be impossible,” said Reinsch of CSIS. “But we looked at the statute and concluded they don’t have to do that. They could run roughshod over the process.” For now, Lighthizer and his team are hoping they can sell the deal to union leaders and Democrats, many of whom say that Mexican labor conditions are a crucial issue that the new pact needs to address. The new deal puts pressure on Mexico to implement longawaited labor overhaul. In one positive sign, the incoming Mexican government has already signaled that it will pass legislation by the by the end of the year that ensures a right to collective bargaining and secret votes for members of labor unions. “I don’t think Lighthizer is the least bit afraid of a House controlled by Dems — and I think he’s played those cards well,” said the Democratic aide, who added that Lighthizer “is still looking for affirmation from Dems — and a particular subset of Dems — to show that the president has delivered.“

III. OUTROS El principal interés en la UE es que Brasil no vaya a romper con el Mercosur Clarin (Espanha) Las instituciones europeas guardan silencio tras la primera vuelta de las presidenciales brasileñas y la posibilidad de que Jair Bolsonaro llegue al poder. Ni la Comisión Europea ni el Consejo Europeo –la institución que representa a los gobiernos del bloque- hicieron por el momento declaración alguna. En la agenda europea sigue la posibilidad de acordar con Mercosur un tratado de libre comercio que se hace esperar desde hace 18 años. La hipotética victoria de Bolsonaro no tendría que suspender las negociaciones, estiman fuentes del brazo ejecutivo de la UE, que miran con más aprehensión las medidas que pudiera tomar en política interna, sobre todo las relativas a libertades civiles. 10

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Europa se maneja bien con democracias y con dictaduras, pero como demostró el caso venezolano, no duda en romper con democracias que se degeneran. Bolsonaro también tiene admiradores en Europa. Son los dirigentes ultraderechistas como el italiano Matteo Salvini o la francesa Marine Le Pen, quienes ven en la hipotética victoria del brasileño una confirmación más de que movimientos como los suyos – nacionalistas, xenófobos, soberanistas- son el futuro. Los analistas son más elocuentes. Carlos Malamud, investigador principal sobre América Latina del Real Instituto Elcano de Madrid, explicó a Clarín que “en líneas generales, Bolsonaro no es comparable a los ultraderechistas europeos. Comparte algunas notas xenófobas y nacionalistas, pero Bolsonaro no tiene una política definida hacia la UE mientras Le Pen o Salvini son abiertamente eurófobos. En el discurso de Bolsonaro –al contrario que en el del estadounidense Donald Trump- no aparece ninguna crítica a la UE”. El problema de Bolsonaro para Europa, dice, “es su indefinición. El multilateralismo no le gusta mucho. En materia económica empieza a rodearse de personajes tranquilizadores para los mercados y habrá que ver qué línea sigue en relaciones exteriores y quién será el canciller”. Malamud no cree que las relaciones europeas con Brasil se dañen. Considera que “si la economía va bien, otras variables van a ir relativamente bien, incluidas las relaciones exteriores”. También destaca que Bolsonaro “habla de abrir la economía de Brasil al mundo, de insertarla en un mundo más abierto, reducir el tamaño del Estado, privatizar empresas y abrir una economía muy cerrada”. Eso haría, según este experto, que las relaciones se mantuvieran. “Otro factor que intervendrá, que no pasa directamente por la UE, es la propuesta del Brasil de Bolsonaro con Mercosur. No es tanto que pueda tener una política específica para la UE, sino que si intenta ir en contra de Mercosur eso sí puede resentir la relación porque a Europa no le gustaría que Brasil se saliera de Mercosur. Europa no va a defender a ultranza la necesidad de Mercosur, pero sería una mala noticia”. En cuanto al futuro del acuerdo comercial, Malamud cree que “Bruselas, como muchas otras diplomacias, va a esperar y ver. La incertidumbre es enorme.

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Si los pronósticos entorno a la política económica se cumplen no habría obstáculo. Si por el contrario se lanza a una política abiertamente antidemocrática que avasalle las libertades individuales pondría a Bruselas en un compromiso y haría que tomara cierta distancia del régimen”.

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