Trade Regime Research Articles

Enclaves of Exception: Reaping the Advantages of Colonialism Through Free Trade in the Scandinavian Caribbean, 1672–1815

ABSTRACT The mercantile history of Charlotte Amalie and Gustavia, free ports in the Danish (1672–1917) and Swedish (1784–1878) Caribbean, have existed outside of the standard purview of both national and transnational historiographies, despite the considerable attention they received by eighteenth century political and economic thought. Due to their unique legislative character, they cannot be situated easily within available historical frameworks. In contemporary politico-economic opinion and eyewitness accounts, the Scandinavian free ports were equated to other free trade regimes insofar as they were conceived as a means of commercial rivalry against other nations. The liberal laws of free ports were styled as consistent with Enlightenment theories of equality and industry, even though they did not represent anything novel in the permeable commercial world of early modern colonialism. Interloping, as the practice of trespassing commercial privilege was commonly referred to, was a key feature of the transit trade operating out of these free ports. The utility of the free port trade was highly contingent upon shifting alliances and patterns of conflict. Operating across the peripheries of other empires, Scandinavian free trade designs in the Caribbean were beneficial for various actors, including but not limited to the parent states themselves.

From Rope to River

This article explores the symbolic aspects of the execution of Captain William Kidd during the Golden Age of Piracy, focusing on the visual messages conveyed. Examining the social-cultural milieu of the gallows in England circa 1700, it reveals the unique aspects of Kidd’s execution and its implications for colonial dynamics and trade governance. By delving into the intended audiences and multifaceted messages behind these executions, the article sheds light on the intertwined dynamics of piracy, colonialism, and trade governance and their impact on the evolving global order. Keywords: law of piracy; Captain William Kidd; early eighteenth century; public executions; Admiralty Sessions; gibbeting.

Can Regional Comprehensive Economic Partnership Alter the Direction of Global Textiles and Clothing Trade? A Computable General Equilibrium Analysis

The purpose of the article was to investigate the criticality of Regional Comprehensive Economic Partnership (RCEP) to the direction of the international trade regime of the textiles and clothing (T&C) sector. The reason for selecting this sector is because RCEP block exported 50% of the global share of T&C products in 2019. Besides, this industry has been quite important from an employment generation point of view and a leading earner of foreign exchange for many nations around the world. Given the free trade agreement and an ambitious approach towards removing the majority of tariff lines pertaining to this sector, RCEP can potentially alter the direction of T&C trade and have related spillover benefits and trade-off in the global supply chain. This study undertakes an evaluative investigation through computable general equilibrium modelling. The article tries to analyse the impact of a potential free trade agreement specific to the RCEP block on the member nation’s gross domestic product, exports, industrial production, employment and welfare. The impact on exports is reportedly a mixed bag where countries such as China and Vietnam stand out to gain enormously while a few others are expected to lose. On similar lines, production in this sector appears to rise for RCEP members such as Singapore, Vietnam, South Korea, Japan, China and Cambodia while for other members the same is seen to decline. Also, T&C trade is noticed to divert away from non-RCEP members. An important policy implication for non-member RCEP nations is to ratify individual trade agreements pertaining to T&C trade. The study shows the mitigation of the trade diversion effect of RCEP by taking India’s example and incorporating its free trade agreements in T&C trade with RCEP non-member country like the UK and then with RCEP nation like Australia. The supposed trade agreements of India have been incorporated in the main model along with RCEP.

Integrating Explicit Political Costs into a World Trade Organization Negotiation Simulation

ABSTRACT This paper enriches the existing set of global trade negotiation simulations by incorporating explicit, country-specific domestic political consequences incurred from trade concessions. Several semesters of testing with undergraduate students in the U.S. and master’s students in Argentina demonstrate that the simulation statistically significantly enhances students’ understanding of the role that domestic political pressures play in preventing negotiators from reaching the first-best trade regime. Students learn-by-doing that conflicting country philosophies regarding free trade vary substantially not only between developed and developing countries, but also depending on the geography and key industries of each country. The simulation also provides students with current, realistic economic values for the country and the world from freeing trade. Seventeen country tables provide instructors with tremendous flexibility in structuring the negotiation framework. A complete instructor’s manual with a detailed description of how to use the simulation, all student handouts and an Excel file that automatically calculates point totals is available via e-mail from the corresponding author.

Competing Regionalisms in the Asia-Pacific? Versatile Sustainable Development Issues in FTAs

The essay explores the inclusion of sustainability commitments in free trade agreements (FTAs) in the Asia-Pacific and the potential differences in their emphases that may reflect “competing regionalisms” in the region. Discussing the geo-economics of cross-border regionalism, the diverse trade agreements are compared as to provisions on sustainable development, and reflected with European Union FTAs. Findings indicate a lack of sustainable development issues in the Regional Comprehensive Economic Partnership and in China’s FTAs with regional neighbors, whereas the Trans-Pacific Partnership, and its successor, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, have substantial commitments on environmental and labor protection. The results suggest that the role of advanced economies as norm setters in sustainability policies may be challenged by a shift toward other emphases in Asia-Pacific FTAs. This contributes to our understanding of the cross-currents in global trade regime leading to competing regionalisms, and therefore, the limits to multilateralizing sustainability issues.

Dissident Labour Activism in Vietnam

Scholars of Vietnam have studied different forms of labour resistance such as wildcat strikes, petitions, complaints, work stoppages, and boycotts, with which workers demand higher wages and pensions, overall better working conditions, and the implementation of workers’ rights. This article pays attention to the small, yet not negligible group of dissident labour activists, who are subjected to much harsher state repression compared to labour resistance in and around the workplace. This article asks: What makes dissident labour activism a (real or perceived) threat to the state? A common and widely accepted explanation refers to the nature of the demands of dissidents, which includes independent trade unions, democratisation, and regime change. This article digs deeper and finds that dissident labour activists function as agents of an emerging epistemological third space, which permits the revitalisation of hidden knowledges about labour rights, the reclamation of the silenced idea of independent trade unions and the co-existence of critique of the status quo and imagination of an alternative future, which together threaten to endanger the Communist Party of Vietnam’s political legitimacy and, by implication, capital utilisation.

Policy responses to COVID-19: lessons for the global trade and investment regime

BackgroundDuring the past two years, the COVID-19 pandemic has cost millions of lives around the globe, caused major morbidity and provoked widespread economic and social disruption. In response, governments have enacted policies to mitigate the impacts of the pandemic. This research focuses in on policies aimed at increasing access to essential health products and services by comparing them to the global rules governing trade, investment and intellectual property. We have assessed whether these rules have or could have constrained countries in responding to this and future crises. The study identifies the nature and scope of the trade-related health sector policies implemented by our sample group of countries, selected because of their systemic significance: the United States, Germany, France, China, South Africa and India. Each policy is placed into one of five broad categories covered by trade and investment rules so that we could assess their consistency with those rules.ResultsWe found, among other things, that the types of trade-related health measures were quite diverse. The high-income countries in our study were the most active in the policy space and tended to rely on subsidies-based measures while the middle-income countries relied more heavily on export and import measures. Policies directly relevant to intellectual property protection were virtually non-existent. When evaluating the implemented policies against the global trade and investment rules, we found potential constraints under five different types of rules: those governing subsidies, import and export trade barriers, investment measures, government procurement and trade-related intellectual property.ConclusionsGiven the tension between the global rules and the practices of policymaking during the pandemic, we conclude that the tension must be resolved in favor of governments making policy rather than relying on existing exceptions or pushing national governments to comply more exactly with the rules. Although the pandemic itself does not respect national borders, governance still generally occurs at the national level because national governments are often the only entities with both the legal authority and the practical ability to respond.

Preface

RECTOR OF DIPONEGORO UNIVERSITY PROF. DR. YOS JOHAN UTAMA, S.H., M.HUM.Assalamualaikum Wr. Wb.Keynote speakers, Distinguished participants, Ladies and Gentlemen,It gives me a great pleasure to extend to you all my warmest welcome on behalf of Diponegoro University and to say how honored we are to have your presence here at INTERNATIONAL CONFERENCE ON AGRICULTURAL SUSTAINBILITY. This conference has been organized by Faculty of Animal and Agricultural Sciences.Concept of Food Sovereignty becomes more and more urgent and apparent on different levels, from sector level to global level. According to Via Campesina, food sovereignty is the right of peoples to healthy and culturally appropriate food produced through ecologically sound and sustainable methods, and their right to define their own food and agriculture systems. It puts those who produce, distribute and consume food at the heart of food systems and policies rather than the demands of markets and corporations. It defends the interests and inclusion of the next generation. It offers a strategy to resist and dismantle the current corporate trade and food regime, and directions for food, farming, pastoral and fisheries systems determined by local producers. Food sovereignty prioritizes local and national economies and markets and empowers peasant and family farmer-driven agriculture, artisanal fishing, pastoralist-led grazing, and food production, distribution and consumption based on environmental, social and economic sustainability.Therefore, I on behalf Diponegoro University, am deeply honored for the privilege to host this International Conference. I believe that this conference will be a good place to share your recent discoveries in your respective fields, to build partnership, so that we can move closer to answer the world feeding challenge, together.I would like to congratulate the committee for a job well done preparing this seminar. My special gratitude goes to keynote speakers, all participants, sponsors and all other parties supported this event.Finally, this is an opportune time for me to declare the official opening of the INTERNATIONAL CONFERENCE ON AGRICULTURAL SUSTAINBILITY.Wassalamualaikum Wr. Wb.List of Organizing Committees is available in this pdf.

Can authorities curtail falsified trade & investment data that hide capital movements? Evidence from flows between BRICS and the USA

Usually developing and transitional countries are characterised by foreign exchange and capital scarcities and hence resort to stringent trade and capital control policies. This might become counterproductive and provide incentives to the international traders and investors to go for corrupt practices. This paper investigates how do these tight policies might encourage illegal or hidden capital movements across borders. By presenting both a theoretical and an empirical analysis, where traders and investors rationally misreport to evade stringent trade and investment barriers, we first show that illegal capital outflow takes place through trade misreporting and interestingly, export and import misreporting are cointegrated. Secondly and more importantly illegal capital inflow might take place through overreporting of FDI values and illegal capital outflow and inflow are cointegrated too. Based on the thorough investigation of the BRICS – USA bilateral trade and FDI data, we propose that a less regulated trade and investment regime might benefit these countries more as tight and restrictive policies seem to be self-defeating. Our study comes up with policy conclusions that might minimise the cross-border illegal capital movements.

Article XX of the Gatt 1994 and WTO Members: Sufficient Freedom to Define And Pursue Environmental Policy Objectives

Abstract Providing free trade conditions to all WTO Members, the GATT 1994 includes general exceptions to Article XX, which allows members to adopt trade and legislative restrictions and measures to promote values and interests and the protection of the environment. Driven by the aim of protecting the environment, various countries have been adopting a considerable number of measures to protect the environment and all human, animal and plant life and health under their jurisdiction. However, such restrictions are likely to influence the free trade regime through a clash of interests and relationships between WTO Members, which are challenged through WTO dispute settlement mechanisms. Although the WTO provides exceptions under Article XX of its free trade conditions to protect the environment via the national environmental measures of WTO Members, the justifications for such measures are challenged in meeting the requirements of Article XX.

Competition among purposes: The Chinese Experience in the Governance of Climate Change and Energy Transition

ABSTRACT Energy governance at the international level is fraught with difficulties due to the ‘competition among purposes’ between different bodies of international law. In this paper, we extend this thesis to argue that the same tension may be found in domestic energy governance. Drawing from China’s experience in the governance of climate change and energy transition, we analyse how the misalignment of incentives between different actors and the incomplete market reform led to a drastic shift in policy in 2021. We also compare the different approaches in China’s energy governance and trade governance and draw some general lessons on how developing countries might overcome such governance problems.

Rights redux: the return of human rights at the WTO

The conventional wisdom is that human rights have long been off the negotiating agenda at the World Trade Organization (WTO). The failed attempt by Northern states to include a ‘social clause’ in WTO rules during the late 1990s and early 2000s is often cited as having foreclosed bringing human rights to bear in multilateral trade negotiations. This article challenges this traditional view, demonstrating that states are mobilizing human rights at the WTO to shape current global trade rulemaking. Moreover, in sharp contrast to the prevailing assumption that developed countries are the primary champions of human rights in the trade regime and developing countries the opponents, I show that developing countries have in fact become key protagonists in marshalling human rights at the WTO. To illustrate these claims, I examine how developing countries mobilize human rights norms, principles and discourse to shape global trade rulemaking in two of the most contentious issues in recent WTO negotiations: The use of public food stockholding for food security purposes and a TRIPS waiver to ensure access to COVID-19 vaccines.

Integrating non-binding labour standards in binding trade agreements: The ILO’s feedback loop

ABSTRACT Much attention has been placed on how trade agreements integrate and benefit from a non-binding International Labour Organization (ILO) declaration. That declaration lists the fundamental labour principles to which all the ILO’s members, and thus the trade parties, have already consented. However, until now, it has been unclear whether and to what extent that integration, in turn, benefits the ILO’s regime. Comparing standard-setting negotiations at the ILO in 1998 and 2022, this article argues that the hardening of non-binding labour rights in binding trade agreements stagnates and complicates new labour standards. The ILO’s members now demand a saving clause expressly decoupling their new non-binding standard from their binding trade commitments. The implications of those negotiations for the future standard setting are wide-ranging and significant. As states become more aware of the potential binding nature of their non-binding standards, they are decoupling the ILO’s regime from their trade regime and shrinking the reach of the ILO’s fundamental principles in the process. This article draws from labour-adjacent standards integrated into trade agreements to show how states may mitigate that feedback loop.

Renegotiating in good faith: How international treaty revisions can deepen cooperation

International agreements are often understood to help governments make credible commitments to future policy by limiting their ability to renege on their promises. Renegotiations of agreements are accordingly viewed as a threat to cooperation, since renegotiations call past commitments into question. But we know little about the frequency or nature of treaty renegotiations. When are international agreements renegotiated, and what effect does renegotiation have on international cooperation? Do most renegotiations indeed aim to backtrack on past commitments? Using the topical context of the trade regime, I collect new data on international treaty revisions, covering 310 preferential trade agreements signed since the year 2000. Around a quarter of these agreements have been amended in some form, and the supermajority of amendments result not in scaled back agreements, but in deeper commitments. Survival analysis shows that ‘like-minded’ countries with a shared language and similar voting patterns at the UN General Assembly are most likely to revise their commitments. In contrast, I do not find evidence to support the view of PTA revisions as ‘backsliding’ on past commitments. The effects of revisions on trade cooperation support the more cooperative view of revisions. An error-correction model shows revisions are associated with a long-run increase in export volumes. Renegotiations are not breakdowns in international relations, but opportunities for governments to renew their commitment to cooperation.

Depreciation to correct trade deficit- a misdirected policy: Empirical evidence from Pakistan

A favorable trade balance is a positive indicator for emerging economies, and rectifying trade imbalances is paramount for every country. However, fixing trade deficits by depreciating the currency is a misguided policy approach. This study refutes this myth by computing the elasticity of Pakistan's exports, imports, and trade balance using the real exchange rate. It also examines the degree to which trade elasticities respond to changing trade regimes and exchange rate policies in Pakistan from 1982 to 2019. The structural break cointegration technique is used for empirical analysis. The vector error correction model (VECM) is also employed in the study to establish long-run and short-run relationships. The findings show that depreciation boosts import demand rather than export demand, hence worsening the trade balance. As a result, the study dismisses the presence of the J-curve in the case of Pakistan. According to this analysis, the exchange rate policy has little bearing on the economy's structure, and the necessity for a devaluation results from economic structural inefficiencies rather than trade-enhancing policies. The government and policymakers should reform the economy rather than let the currency depreciate.

Heterogenous impacts of trade liberalization on individual wages: Evidence from Thailand

This study empirically examines how trade liberalization changes individuals' wages, with evidence from Thailand. We primarily focus on the effect of Thailand's tariff reduction under the ASEAN free trade regime. We use individual‐level employment data for 2001, 2006, 2011, and 2016. We find that the reduction in AFTA tariffs in Thailand decreases the relative wages of the more educated and skilled workers. Thus, trade liberalization contributes to narrowing income inequality in terms of education and skills. Contrastingly, we do not find heterogeneous effects according to age, sex, marital status, location, or company size. Moreover, the results do not differ significantly between industries with or without international competitiveness.

‘Saving the WTO’: middle power insiders and joint statement initiatives at the World Trade Organisation

ABSTRACT Studies have argued that gridlock in the multilateral trade regime has contributed to processes of regime shifting and creation through the expansion of regional and bilateral agreements. Scholars have long debated the impact of such agreements on the multilateral regime exploring their effect on the incentives of insiders, countries that have signed such agreements, and outsiders, countries that are excluded from such agreements. Based on interviews with officials from sixty member states at the World Trade Organisation, this paper examines this issue by analysing the behaviour of insiders and outsiders in the multilateral trade regime. While analysis of trade and investment diversion might lead us to predict that outsiders will have a stronger interest in the multilateral regime, I find that insiders, particularly middle powers, are key drivers of attempts to end the stalemate in the World Trade Organisation by championing what became known as Joint Statement Initiatives. I explain this position by the systemic support of middle powers to the multilateral regime and by the shift in trade governance towards deep integration issues in which discrimination against outsiders is infeasible or costly.

Торговельна політика України в Азії в умовах багатополярної глобалізації

The article defines the directions of Ukraine’s trade policy under multipolar globalization, which assumes that the centers of development and trade are concentrated both among developed and developing economies. The article analyzes the development of Ukraine's trade with the leading economies of Asia - China, India, Japan and the Republic of Korea, which have created a powerful pole of world trade in Southeast Asia. However, domestic exports to these countries are developing unevenly and at a moderate pace. The latter is explained by the specific features of the trade regime of these countries, primarily the high level of non-tariff market protection. Domestic exports to Asian countries remain extremely undiversified with the predominance of one or two goods in the structure: mainly ores and corn are exported to China, to India - sunflower oil, to Japan - ores and tobacco products, and to Korea - corn and wheat. Estimates of the volume of trade in domestic goods after the full-scale invasion of the Russian Federation into Ukraine show that in the first half of 2022 alone, the exports to Asian countries decreased by 49%, and the imports decreased by 20%. It is assumed that by the end of 2022, the volume of foreign trade turnover between Ukraine and the People’s Republic of China may decrease by an average of 32.9% compared to 2021, India – by 41.9%, Japan – by 26, 6%, and Korea – by 28,5%. Diversification of commodity exports with an emphasis on goods with a higher share of value added is defined as an important direction of trade policy in relation to the leading countries of Asia. In particular, prospective agricultural export products to Asian countries are honey, chicken, dairy products, etc. Prospective industrial goods include inorganic chemical products, fertilizers, wood products, nuclear reactors, etc. Recommendations for improving Ukraine’s trade policy have been developed, and the need is substantiated to conclude free trade agreements in order to further develop Ukraine’s trade with leading Asian countries. Also, the need to abandon the idea of negotiating a free trade agreement and investment agreement with China has been proven. The article analyzes the policy of economic patriotism pursued by the Indian government, in particular as a response to the full-scale invasion of the Russian Federation into Ukraine. The authors note India’s disagreement on issues of opening markets for sensitive agricultural products, which causes the complexity and delay in the negotiations on free trade with this country. Access to the markets of Japan and the Republic of Korea is complicated by the high level of tariff and non-tariff barriers. However, the analysis of the trade policy of these countries shows that a significant part of markets of both agricultural and industrial goods in these countries were opened due to the numerous FTAs. It is recommended to initiate negotiations on free trade with Japan and the Republic of Korea in order to improve Ukraine’s competitive position in the markets of these countries.

Institutional Provision of Tariff and Non-Tariff Regulation of Cross-Border Trade

Introduction. The study is devoted to a comprehensive study of the global trade system in conditions of global economic instability, in particular, to the identification and analysis of the determinants of deepening its asymmetries in the regional perspective. The study contains a description of the peculiarities of the modern global trade system and regulatory regime, including tariff and non-tariff methods of regulating cross-border trade and key trends in its development.
 Aim and tasks. The purpose of the study is to diagnose the institutional provision of tariff and non-tariff regulation of cross-border trade in order to determine the presence or absence of asymmetries in the global trade system in the regional context.
 Results. The study identifies and systematizes fundamental features of the modern global trade system whose development has been directly or indirectly influenced by regional asymmetries. Particular attention is paid to the characteristics of the major international economic organizations as the main regulators of the cross-border trade process, and to the study of the impact of the use of tariff and non-tariff import and export regulatory tools on cross-border trade asymmetries. The world trading system is divided by country and individual customs territory, depending on whether it belongs to a certain geographical area or to a group of countries with a certain level of economic development.
 Conclusions. Although the expansion of global trade has visually slowed down, the integration of world trade is not over, on the contrary, there are clear signs of the beginning of a completely new phase of globalization. The presence of asymmetry in the world trading system in a geographical context, regardless of the size of the region, has been theoretically proven. According to the criterion of the asymmetry of the trading system depending on the level of economic development of the countries, in general, there is a tendency to increase the level of liberalization of trade regimes by the increase in the level of development. At the same time, it has been proven that belonging to the group of least developed countries does not necessarily mean closed access to national markets, and categorization as a developed country does not indicate the application of the least number of non-tariff measures to regulate trade volumes. At the same time, Ukraine remains a country that has undertaken the most liberal obligations regarding providing access to markets for both goods and services. As one of the world's leading exporters of agricultural products in 2020, Ukraine has set the customs tariff level at 11%, the lowest among group members.

Challenges of Informal Cross-Border Trade Facilitation in Tanzania: Lessons from Kigoma Border

ABSTRACT This study investigates the challenges of an informal cross-border trade (ICBT) facilitation initiative in Tanzania. Specifically, it identifies the regulatory framework governing cross-border trade (CBT), and investigates the challenges of facilitating ICBT. It is based on in-depth interviews with 51 officials from 10 trade-regulating agencies and 47 cross-border traders in Kigoma, Tanzania. The findings reveal that ICBT is largely attributed to the stringent regulatory requirements and high costs of trading via formal routes. Although different trade facilitation measures have been taken, several challenges of CBT facilitation were identified, namely: limited awareness of the existing initiatives; inadequate border facilities; lack of a mechanism to escalate traders’ challenges to the relevant agencies; limited resources; ineffective coordination; hesitation of traders to utilise trade facilitation initiatives; and informality of traders in the neighbouring countries. While we support the rational exit and dual economy views that traders operate informally to avoid the cost of formalisation, we show that trade facilitation measures adopted in the context of the World Trade Organisation (WTO) do not offer traders sufficient incentives to formalise. Accordingly, we suggest a trade regime consisting of simplified documentation and reduced trade costs to effectively accommodate ICBT in the international trading system.