How did China’s National Indigenous Innovation Policy emerge, what has it achieved, and where is it going? And most importantly, is the NIIP a model for other emerging economies to replicate – and what does this mean for the global economy?

For full testimony click HERE.
Comments welcome.

A discussion to the Council on Foreign Relations on Enforcing Trade Agreements Alan Wm. Wolff shares three observations and gives six recommendations on the state of enforcement of International Trade Agreements

Observations conclude that enforcement of trade agreements is most strongly carried out through a country’s self-restraint, through a commitment of a country to live up to its obligations, specifically when challenged on these commitments, and lastly through U.S. Congress’s criticism of the record on enforcing trade agreements.

Observations as to why enforcement comes up short conclude that many unfair trade practices are complained about but not challenged, that a party needs to have commercial and policy reasons to bring a case, that the international rules may not cover the grievance, that WTO rules may be ambiguous in application, that the facts of the trade abuse may be difficult to demonstrate, that the dispute settlement system may fail to get the right answer, because of the time WTO litigation takes, or that what may be a “win” for USTR is not so in commercial gains.

For entire article including Alan Wm. Wolff’s recommendations to better enforcement please click HERE.

The Commercial Aircraft Corporation of China (Comac) is preparing the C919 Commercial Jet for its first flight in 2014, and this has elicited deep concern from U.S. officials. But for China to realize its seat among incumbents Boeing and Airbus and break up this longstanding duopoly, China’s C919 has to be globally competitive. A future where the C919 will compete in world markets is promising, but only if China maintains a market open to international trade, global supply chains, and foreign investment. In the meanwhile, China’s scale, quality, and diversification of high-tech manufacturing continue to strengthen its ability to choose partners in the globally competitive commercial aircraft industry.

For more detailed analysis, go to Luxi Zhou’s opinion article in which she shares her insight on the Strategic Implications of China’s C919 Commercial Jet by clicking HERE.

]]> http://blogs.miis.edu/globaltrade/2011/02/16/chinas-c919-commercial-jet-luxi-zhou-itp-2010/feed/ 0 http://blogs.miis.edu/globaltrade/2010/11/12/student-contribution-green-auto-business/ http://blogs.miis.edu/globaltrade/2010/11/12/student-contribution-green-auto-business/#comments Fri, 12 Nov 2010 14:14:00 +0000 Gabriel Key http://blogs.miis.edu/globaltrade/?p=324 Continue reading →]]> As a part of Ambassador Wolff’s “Competing in and with China” October 2010 workshop students were required to contribute papers focusing on specific industries or policies.

The following is an excerpt from Jeanne-Marie Pilkerton’s submission:

On June 30, the Chinese government announced a plan to place hefty subsidies on green vehicles in an effort to encourage consumers to buy more environmentally friendly vehicles. Under the plan, the government will offer subsidies of up to 60,000 Yuan and 50,000 Yuan for electric cars and plug-in hybrids in 13 cities across the country including Beijing and Shanghai. However, auto industry officials are concerned that even with these financial incentives, green cars will still be too expensive for the average Chinese consumer, and that it will take time for them to get familiar with energy saving vehicles.

Click here to read the full submission

Click here to read the text of his remarks.

“If closing oneself off from the global economy were the path to success, then North Korea would be the richest, most prosperous country on Earth.  But there is little risk of anyone trying to escape to the North across the border at Panmunjom.

For half a century, in the face of an existential threat from Soviet communism, Americans from across the political spectrum agreed that the path of economic openness was the path of prosperity and security.

Today, in the absence of that fundamental external threat, there is a hole in the middle of our politics on international economic affairs.” … click here for more

According to many leading economists China’s currency is undervalued by an estimated 25 to 40%. Keeping the RMB cheep subsidizes Chinese exports and creates disincentives for imports into China. The bilateral trade deficit with China has reached the point where it hurts the economy more than domestic expansionary U.S. fiscal measures.  Although there could be a net gain for the U.S. economy from revaluation of the RMB, revaluation of the RMB alone is not a cure-all for the trade issues between China and the US or other trading partners. To truly address these issues, China to must be able to achieve sound economic growth in conjunction with, not at the expense of, sustainable relations with its trading partners through a combination of policies focusing on increasing demand within China, liberalization of Chinese purchases of other countries’ products, and deterring state-directed policies resulting in overcapacity and consequential dumping on world markets.

Click here for more …

According to the article, the Premier stated the current situation “is not all due to misunderstanding by foreign companies. It’s also because our policies were not clear enough.”

Premier Wen’s also restated China’s commitment to an open and fair trade and investment environment stating: “China is committed to creating an open and fair environment for foreign-invested enterprises.”

Reportedly, these comments are unusual because they apparently reflect concern within China’s leadership while also acknowledging China’s role in the increasing hesitation and debate about the costs versus benefits for foreign company investment in China.

So, will this be the beginning of the end of an area when “some Western firms enter into [joint ventures] to gain access to local manufacturing capacity and contacts, and find they need to share technology as part of the deal.” (WSJ, In China, Western Firms Keep Secrets Close, August 30, 2010)

According to another recent Wall Street Journal:

“… each [foreign investment] deal will require approvals from Chinese authorities who have a reputation for pressuring foreign investors to introduce their latest proprietary technology, but a weak track record for protecting it.” (WSJ, In Toledo, the ‘Glass City,’ New Label: Made in China, August 30, 2010)

If the Premier’s remarks symbolize an end to China’s often questioned policies of technology transfer in return for the opportunity to access the market, what will follow? How will any written or un-written policies be changed or revised to promote a free and fair environment while still protecting China’s domestic, economic, national and international interests?

Authored by: Gabriel M Key

On August 16, 2010 Mexico showed its frustration with the ongoing 15-year-old trade battle over the US ban on Mexican truckers operating more than 25 miles north of the US – Mexican border by adding 26 US products to its tariff list. With the additional products, a total of 99 US products face additional tariffs when exported to Mexico, 54 are agricultural and 45 are manufactured.

Interestingly, according to Mike Powers, vice president of the Northwest Horticultural Council and the Wall Street Journal, these tariffs appear to be designed to target specific states and industries, particularly those with upcoming elections and close ties with groups opposed to Mexican truckers such as the International Brotherhood of Teamsters. “As we look at the new tariff list and its timing, we have to wonder if the Mexicans have the American election calendar in mind. Wisconsin (Russ Feingold), Washington (Patty Murray) and California (Barbara Boxer) are all states with Democratic Senators who follow the Teamster line.”

Regardless if this is true or not, it is a mistake to write off these new tariffs as meaningless.  According to the Office of the United States Trade Representative, more than $367 billion dollars worth of imports and exports crossed the US – Mexico border in 2008. Mexico is the third largest trading partner with the US and “the number one trading partner for 22 American States.” The US Embassy in Mexico states: “Mexico and the U.S. do as much business in goods and service in just over a month as Mexico does with all 27 countries of the European Union combined in a year.”

Simply put, these tariffs will affect farmers: “The new tariff on apples alone is estimated to inflict another $44 million in economic damages to growers…” “Washington state apples and California oranges and pistachios, among other things, will now cost 20% more in Mexico than they did last week. Cheeses from California and Wisconsin now face a 25% tariff.” The tariffs also give competing exporters from Chile and Canada advantageous opportunities: “Dave Warner, spokesman for the National Pork Producers Council, said the 5 percent Mexican tariff on U.S. pork products will benefit rival exporters to that country, such as Canada and Chile.” “This is bad news for U.S. producers whose goods compete with exports from countries like Canada and Chile, which have free trade agreements with Mexico. It is a wound that the fragile and export-dependent U.S. economic recovery can ill afford.”

Therefore, it seems now is the time to put this 15-year-old dispute to rest and for the US to find a way to fulfill its NAFTA obligations as well as living up to its stated public support for free and fair international trade. After all, as United States Trade Representative Ron Kirk stated at the January 2010 inauguration of the U.S.-Mexico Anzaldúas border crossing, “[T]rade makes us all stronger.”

Authored by: Gabriel M Key

On June 24, 2010, U.S. Senate and U.S. House of Representatives passed the “Comprehensive Iran Sanctions Accountability and Divestment Act of 2010”, broadening and intensifying U.S. sanctions against Iran. President Obama signed the legislation into law on July 1, 2010, calling them the “toughest sanctions against Iran ever passed by the United States Congress.”

Seminar panelists included Mel Schwechter, Harry Clark, Clark McFadden, Charley Landgraf, and senior advisor Dana Marshall, as well as Bill Reinsch, President of the National Foreign Trade Council.  Attendees from New York, Dubai, Riyadh, Frankfurt, Milan, Moscow, Paris and Warsaw participated via live video conference.

Click here to view a PDF copy of Ambassador Wolf’s remarks.

Click here for information about Ambassador Wolf and his work at MIIS.

Click here for more information about the seminar.