Trade War! US Trade Protectionism

WTO warns against US possible trade protectionism measures

GENEVA - The World Trade Organization (WTO) reviewed the trade policy of the United States on Wednesday in Geneva, warning against its possible protectionism measures against its trade partners.

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A relating report was issued by the WTO secretariat with the review. While ranking the US trade and investment regimes as " among the most open in the world," the report also listed possible protectionism measures applied by the United States against its trading partners.

"The United States had 246 antidumping duty (AD) orders in effect in December 2009, 22 more than in December 2007 ... affect imports from 40 countries or territories," and countervailing duties (CVD) "final orders increased from 31 in 2007 to 41 in December 2009," the report said.

The United States is experiencing "a marked slowdown in the pace of negotiating free-trade agreements (FTAs)," the report added.

The report also expressed its concerns over "some anti-recession measures," including "provisions that favored domestic suppliers of goods and services."

Trading issues between the United States and its major trading partner China are also repeatedly mentioned in the report, including the additional imports duty apply on tyre imports from China and the decision by the United States in 2007 to abolish its long-standing policy of not applying CVD on China.

Sun Zhenyu, the Ambassador and Permanent Representative of China to the WTO said in a statement during the review "there is an incremental setback of free trade vis-vis trade protectionism in the US, particularly during and after the financial crisis."

Sun is worried about the side-effect that might be brought about by the expansionary monetary policy of the United States and its step back from the due leadership role in Doha Round negotiations.

During the review, many WTO members blamed the United States for not playing an active part in pushing ahead the Doha round negotiations and urged the United States to assume its role at an early time.

Trade Policy Review is an exercise, mandated in the WTO agreements, in which member countries' trade and related policies are examined and evaluated at regular intervals. All WTO members are subject to review, with the frequency of review depending on the country's size.

The tenth review of the trade policies and practices of the United States takes place on 29 September and 1 October 2010. The basis for the review is a report by the WTO Secretariat and a report by the Government of the United States of America.

WTO rules China win over US imports dispute

(Xinhua)
Updated: 2010-09-30 07:09

GENEVA - The World Trade Organization (WTO) issued a report of the panel on Wednesday, supporting China over its complaint against measures taken by the United States which have affected imports of poultry from China.

Related readings: United States files two cases against China to WTO  China gets WTO backing in chicken import row with US  Debts to Chinese exporters hit $150b  US demand for overseas products may dip

The panel ruled that Section 727, the Omnibus Appropriations Act of 2009, applied by the US had effectively prohibited the lifting of the ban on poultry imports from China, and inconsistent with the WTO Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement). 

The panel concluded that the United States trade regime has not acting in accord with the specified provisions of the SPS Agreement and the GATT 1994, and has "nullified or impaired benefits accruing to China under those agreements."

In 2004, China and the United States stopped importing poultry products from each other for fear of the bird flu. China had called off the ban on poultry import from the United States when the situation was relieved.

Access of Chinese poultry to the US market is still blocked, because of the application of Section 727 passed by the US congress, which restricted the United States Department of Agriculture (USDA) and its agency, the Food Safety and Inspection Service (FSIS) from using funds allocated by the US Congress to create a rule to lift the poultry ban on China.

At the request of China, a panel was established by the WTO on 23 September 2009 to investigate the case.

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Global ‘currency war’? G7 meets on 'international currency war' !

IMF chief sees no risk of a global ‘currency war’

Currencies to be discussed at IMF and G20 meetings

WASHINGTON: International Monetary Fund (IMF) chief Dominique Strauss-Kahn said on Tuesday he did not see a risk of a global ‘currency war’ as countries intervened to weaken their currencies but acknowledged it was a concern.

The IMF managing director said efforts by countries to devalue their currencies would be discussed at meetings of the IMF in Washington on Oct 8-9 and the Group of 20 (G20) major economies in South Korea in November.


“There has been a rising concern in recent days about this question,” Strauss-Kahn said. “I don’t feel today there is a big risk of currency war despite what has been written.”

His comments came as more governments around the world move to keep their currencies from appreciating to boost exports and improve trade balances. Japan intervened for the first time in six years on Sept 15 to prevent the yen from worsening a faltering recovery. Colombia and Thailand have made similar moves.

Brazilian Finance Minister Guido Mantega on Monday said the world was in an “international currency war”, as governments manipulate their currencies to improve their competitiveness.

Speaking in general terms, Strauss-Kahn said history had shown that such interventions did not have a lasting impact and the IMF preferred that market forces be left to determine exchange rate values.

“The core of the question is this the kind of solution that we can provide to the global situation or not? The answer is no,” he said, adding, “clearly it is not a global solution”.

Strauss-Kahn said since the world financial and economic crisis had eased, cooperation among major economies “has not been as strong as it was before”. “Most countries have a tendency of going back to their problems,” he said. The IMF chief said the world recovery was “still very fragile” and the major issue for policymakers was whether growth was strong enough to reduce high unemployment. “It will be difficult to say that the crisis is over before unemployment is decreasing,” Strauss-Kahn said.

He said the IMF leaned on the “optimistic side” when it came to the economic recovery in the United States. He repeated that the IMF did not see the risk of a double-dip recession although he noted the US recovery had clearly slowed.

The IMF releases updated forecasts for the world economy next Wednesday. Earlier on Tuesday the fund’s No 2 official, John Lipsky, said the global recovery would remain sluggish into early 2011.

Strauss-Kahn said the recovery in Europe “is not strong enough” and some countries needed tough fiscal programmes “because they cannot afford to go on with the situation they’re in”.

“There is no fiscal austerity in Europe, but there is a need for a very reasonable fiscal path for some countries and the possibility for others to go on with withdrawal of their stimulus,” he added. — Reuters

Tension grows as G7 ministers set to meet over 'international currency war'

Bank of Japan reinstates zero interest rate, adding to fears that countries are weakening their currencies to give their economies a competitive advantage

• David Teather
• guardian.co.uk, Tuesday 5 October 2010 18.14 BST
• Article history

 

A bank teller counts 10,000 yen. Photograph: Yoshikazu Tsuno/AFP/Getty Images

 

Finance ministers from the G7 will hold an informal meeting in Washington this week to discuss growing concerns that the world is in the grip of an "international currency war" as government's manipulate their currencies to bolster exports.

The meeting on Friday, on the sidelines of the annual International Monetary Fund gathering, comes amid rising tensions between the western industrialised nations and China, whose prime minister, Wen Jiabao, is on a charm offensive in Europe this week.

In separate moves designed to weaken currencies, the Bank of Japan reinstated its zero interest rate policy and pledged to buy ¥5tn ($60bn) of assets, while Brazil doubled a tax on foreign investors buying local bonds to put a lid on a recent rally in its currency, the real. It was Brazil's finance minister, Guido Mantega, who coined the "international currency war" phrase last week, following a series of interventions by central banks in Japan, South Korea, Switzerland and Taiwan to make their currencies cheaper.

The concerns about currency manipulation have been heightened by the global recession, with many countries, including Britain, seeing a growth in exports as the means to recovery. A weaker currency means a country's exports become more competitive.

The Bank of Japan set its interest rate target to a range of zero to 0.1%, returning to zero rates for the first time in more than four years and underlining worries about the Japanese economy, which is beset by falling prices. Japanese officials intervened in the currency markets last month to weaken the yen, but the impact was only short-lived. "The pace of recovery is slowing down partly due to the slowdown in overseas economies and the effects of the yen's appreciation," the bank said.

Before the IMF meeting, the Institute of International Finance, an industry group representing some of the world's largest banks, urged action. In a letter to the IMF, Charles Dallara, the banking lobby's managing director, called today for greater co-operation. "Urgent action is needed to arrest the disturbing trend towards unilateral moves on macroeconomic, trade and currency issues," he said.

Much of the focus remains on China, which has built its economy on exports and keeps its currency artificially low. Manufacturing figures at the end of last week told a clear story of the divergent economies in the developed world and emerging markets. Factory output in Britain, the US, Spain, Ireland and Greece all fell back sharply during September, while in China, manufacturing output rebounded more quickly than economists had been expecting.

The 16 nations in the eurozone again urged China to allow its currency to appreciate , complaining that Beijing's insistence on keeping the yuan weak was hampering global growth by creating trade deficits in the US and Europe. At a meeting in Brussels, Jean-Claude Juncker, head of the eurozone; the EU monetary affairs commissioner, Olli Rehn, and the European Central Bank president, Jean-Claude Trichet, told Wen that the yuan remained "undervalued". Juncker said: "Given China's important role, we do think that a significant and broad-based appreciation [of the yuan would] promote a more balanced growth to the benefit of both China and the global economy."

Following the Europe-Asia summit, Juncker said the discussions had been "open, frank, but nevertheless friendly" and added that both sides agreed a currency war would be "destructive". But he said the plea for movement on the yuan had been rebuffed by China, which argues that it needs rapid growth in its economy to pull hundreds of millions of people out of poverty. Wen, in return, said the rapidly growing economies of Asia should be granted more power within global institutions and that Europe should give up some of its seats at the IMF.

In Athens at the weekend, Wen attempted to smooth over relations between China and the west by offering support for the euro and suggesting that China would participate in auctions of indebted nations' government bonds, including Greece, as they seek to refinance their struggling economies.

Tensions between Beijing and Washington have been mounting on the currency issue, and Congress has approved legislation enabling the US to impose trade sanctions on China and other nations that manipulate currencies to win competitive advantage. China is also under pressure to stimulate its domestic economy in order to build a market for exports from other nations.

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Apple TV: The case for waiting

by John P. Falcone

 
(Credit: Donald Bell/CNET)

 

The first reviews of Apple TV are hitting the Web today, and there are, for the most part, no big surprises. (Apple declined to provide CNET with an early review sample, but we'll have a full hands-on review as soon as we can purchase one.) As expected, the new Apple TV delivers largely the same experience as the previous model, with the addition of an all-streaming rental service and Netflix compatibility, all crammed into a much smaller form factor. But it's the $99 price tag that's the real attraction here: at that price, the device is likely to become an impulse buy in a way its $229 predecessor never was.

That's the idea, anyway. Unlike the weak competition the first Apple TV faced in 2007, the new one will be entering a far more mature market for Internet TV, with everything from game consoles to Blu-ray players to TiVo DVRs offering the same sort of video-on-demand functionality. Add to that the forthcoming Logitech and Sony products offering Google TV, and the long-awaited Boxee Box product. Already going head-to-head with the Apple TV, meanwhile, is a refreshed line of Roku boxes, with models available at an even cheaper $59 and $79.

Roku got a big boost earlier today with the news that the Hulu Plus subscription service will soon be available on all of the company's existing and forthcoming models. On the surface, that strengthens Roku's pitch as an Apple TV alternative with far more choice. Roku lacks iTunes, of course, but it matches Apple TV's Netflix and Flickr support, plus adds Hulu, Amazon, Pandora, and MLB.TV--in addition to dozens of other, more niche-y "channels" available on its ever-growing roster.

Roku: Up to $40 cheaper than Apple TV, and with Hulu Plus.

(Credit: Sarah Tew/CNET)

 

Hulu Plus promises to deliver all current-season episodes of most ABC, Fox, and NBC shows (and quite a bit of legacy content) for a flat $9.99 monthly fee. That means--assuming you're interested in shows from those networks--that the Roku could save you a bundle versus Apple TV, where your best-case scenario (aside from Netflix) is to buy shows a la carte. Assuming a price of 99 cents, that's just 10 episodes on iTunes (say, two to three a week) versus an unlimited number on Hulu during the same month.

Meanwhile, for shows not available on Hulu Plus, Roku users could rent or buy them on Amazon's service, which has matched Apple's 99-cent pricing on ABC and Fox shows. (We're leaving out a discussion of the Roku versus Apple hardware costs, and Netflix subscription is identical--if not less, if you opt for one of the cheaper Roku boxes. That's at least a wash between these two options.)

So, game, set, match Roku, right? Maybe, maybe not.

Apple starts with a huge brand advantage that the far more obscure Roku just doesn't have. But that's only the beginning of the story. The big wild card in the Apple TV equation is the forthcoming iOS 4.2 update--currently slated for November--that's scheduled to add AirPlay compatibility to iOS devices (iPads, iPhones, and iPod Touch models). As demonstrated during Steve Jobs' September 1 press conference--and highlighted on Apple's Web site--AirPlay is an evolution of the existing Apple Remote app that lets iOS devices control the Apple TV. But instead of just duplicating the features of a dedicated remote, AirPlay lets users stream media from their iPad or iPhone to the Apple TV.

In other words, AirPlay could well be the killer app for the Apple TV. But the problem is that we still don't know the details, and they could make or break a feature like AirPlay. Is it a content-agnostic "screen scraper" that works with all iOS-based media, or is it only compatible with iTunes content? Does it stream the content directly from the iPad/iPhone, or does it merely "hand off" the viewing of a cloud-based source from the handheld product to the Apple TV? Will third-party app providers need to update their apps to be AirPlay compatible--and will the primo content providers like Hulu Plus, ABC, and Pandora be onboard with adding that functionality?

That's a lot of question marks, to be sure. But if Apple sticks to its November time frame for the 4.2 update, we should have the answers in just a few weeks.

And those weeks will be eventful indeed. During the same time, we'll be seeing the Google TV products from Logitech and Sony (neither of which currently have final pricing or availability details) as well as the $200 Boxee Box.

In other words, the Internet TV space is more fluid than ever, with new services, options, and products sometimes only a firmware update away. Even at these tempting prices, we suggest sitting back and waiting a month or two, until we get a more informed picture of how this Internet TV battle royale is shaping up.
That said: Have you already made up your mind? Are you buying an Apple TV or a Roku? Or are you holding out to see what Google TV and Boxee have to offer? Share your thoughts below.

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Google is the 'inverse' of Apple

Schmidt: Google is the 'inverse' of Apple

'We are the opposite of Jobsian closedness'

By Cade Metz in San Francisco • Get more from this author

Eric Schmidt likes to say that Google is a fundamentally "open" company, and according to the man himself, this means that Google is the anti-Apple.

"With the Apple model — which works extremely well, as I know as a former Apple board member — you have to use their development tools, their platform, their software, their hardware," Schmidt said today during an appearance in San Francisco. "If you submit an application, they have to approve it. You have to use their monetization and their distribution. That would not be open. The inverse would be open."

At one point, he said that Apple's core strategy was "closedness."

During last week's interview with The Wall Street Journal, Schmidt made repeated claims of Google openness, and these claims continued this morning at the annual TechCrunch Disrupt conference, as Schmidt explained how Google is working with the rest of the industry to build — and this is an exact quote — "an augmented version of humanity."

"Google's core strategy is openness," he said. "Ours is a fundamentally open [strategy]. Open internet. Open web. It's how we fundamentally drive everything."

After the speech, when one reporter pressed him on what these open claims actually mean, Schmidt served up that comparison with Apple. "The easiest comparison is the Apple model versus the web model," he said. "Flash was allegedly a problem [for Apple]. But we love Flash, and Flash has done extremely well on Android. That 's an example of openness. Let the user decide. The user can decide [between] HTML5 or Flash."

Of course, Steve Jobs likes to say that Apple is open because it prefers HTML5 to Flash — HTML5 being an open standard. And though Schmidt likes to paint Google as open, the company is quite closed when it comes to the inner workings of its search and search-ad platforms — not to mention its back-end infrastructure. It bills a project like Android as open — and to a certain extent, it is — but there's a portions of the project that remain completely closed. That includes development of the latest version of the OS, and certain Google services on the OS.

As we've said before, we've reached the point where the word open is completely meaningless — at least among the digerati. But as he builds his augmented version of humanity, Schmidt will continue to use the term. Repeatedly. ®
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US's Structural Unemployment of Excuses

By PAUL KRUGMAN

What can be done about mass unemployment? All the wise heads agree: there are no quick or easy answers. There is work to be done, but workers aren’t ready to do it — they’re in the wrong places, or they have the wrong skills. Our problems are “structural,” and will take many years to solve.

But don’t bother asking for evidence that justifies this bleak view. There isn’t any. On the contrary, all the facts suggest that high unemployment in America is the result of inadequate demand — full stop. Saying that there are no easy answers sounds wise, but it’s actually foolish: our unemployment crisis could be cured very quickly if we had the intellectual clarity and political will to act.

In other words, structural unemployment is a fake problem, which mainly serves as an excuse for not pursuing real solutions.
 
Who are these wise heads I’m talking about? The most widely quoted figure is Narayana Kocherlakota, the president of the Federal Reserve Bank of Minneapolis, who has attracted a lot of attention by insisting that dealing with high unemployment isn’t a Fed responsibility: “Firms have jobs, but can’t find appropriate workers. The workers want to work, but can’t find appropriate jobs,” he asserts, concluding that “It is hard to see how the Fed can do much to cure this problem.”

Now, the Minneapolis Fed is known for its conservative outlook, and claims that unemployment is mainly structural do tend to come from the right of the political spectrum. But some people on the other side of the aisle say similar things. For example, former President Bill Clinton recently told an interviewer that unemployment remained high because “people don’t have the job skills for the jobs that are open.”

Well, I’d respectfully suggest that Mr. Clinton talk to researchers at the Roosevelt Institute and the Economic Policy Institute, both of which have recently released important reports completely debunking claims of a surge in structural unemployment.

After all, what should we be seeing if statements like those of Mr. Kocherlakota or Mr. Clinton were true? The answer is, there should be significant labor shortages somewhere in America — major industries that are trying to expand but are having trouble hiring, major classes of workers who find their skills in great demand, major parts of the country with low unemployment even as the rest of the nation suffers.

None of these things exist. Job openings have plunged in every major sector, while the number of workers forced into part-time employment in almost all industries has soared. Unemployment has surged in every major occupational category. Only three states, with a combined population not much larger than that of Brooklyn, have unemployment rates below 5 percent.

Oh, and where are these firms that “can’t find appropriate workers”? The National Federation of Independent Business has been surveying small businesses for many years, asking them to name their most important problem; the percentage citing problems with labor quality is now at an all-time low, reflecting the reality that these days even highly skilled workers are desperate for employment.

So all the evidence contradicts the claim that we’re mainly suffering from structural unemployment. Why, then, has this claim become so popular?

Part of the answer is that this is what always happens during periods of high unemployment — in part because pundits and analysts believe that declaring the problem deeply rooted, with no easy answers, makes them sound serious.

I’ve been looking at what self-proclaimed experts were saying about unemployment during the Great Depression; it was almost identical to what Very Serious People are saying now.

Unemployment cannot be brought down rapidly, declared one 1935 analysis, because the work force is “unadaptable and untrained. It cannot respond to the opportunities which industry may offer.” A few years later, a large defense buildup finally provided a fiscal stimulus adequate to the economy’s needs — and suddenly industry was eager to employ those “unadaptable and untrained” workers.

But now, as then, powerful forces are ideologically opposed to the whole idea of government action on a sufficient scale to jump-start the economy. And that, fundamentally, is why claims that we face huge structural problems have been proliferating: they offer a reason to do nothing about the mass unemployment that is crippling our economy and our society.

So what you need to know is that there is no evidence whatsoever to back these claims. We aren’t suffering from a shortage of needed skills; we’re suffering from a lack of policy resolve. As I said, structural unemployment isn’t a real problem, it’s an excuse — a reason not to act on America’s problems at a time when action is desperately needed.

The Malaysian Institute of Accountants is split – what’s next?

By ERROL OH
errol@thestar.com.my

PETALING JAYA: The outcome of the Malaysian Institute of Accoun-tants’s (MIA) AGM on Saturday indicates that the gap in the membership may be widening between small accounting firms on one side, and the rest of the fraternity on the other. The former are dissatisfied with the profession’s regulatory framework and, judging from the voting at the AGM, their call for change is gaining momentum.

Those at the meeting rejected four resolutions, endorsed by the MIA council, to raise the annual membership subscriptions and the annual practising certificate fee. Similar resolutions failed to secure enough votes at last year’s AGM.

On the other hand, six motions that had been proposed and seconded by two members got the nod. These motions were essentially gestures of protest against certain rules that govern the supervision of accounting practitioners.

Christina Foo says it’s up to the council to recommend action.

 

Newly-elected MIA council member Subramaniam Sankar, a senior audit partner in the accounting firm of HALS & Associates, had proposed all six motions. The seconder was Chan Kah Kooi, also with HALS & Associates.

Subramaniam told StarBiz that the next step for the MIA membership and the Government was to determine whether the institute should be a regulator or a professional association.

“If it is decided that the MIA is to be a regulatory body, then we need another professional association to represent our interests and to provide technical expertise. We can’t leave it to the international accounting bodies. We should have a Malaysian organisation,” he added.

Set up under the Accountants Act 1967, the MIA’s chief tasks are to regulate and develop the accountancy profession in Malaysia. It is in fact a hybrid organisation, embracing the roles of both a regulator and a professional body.

MIA vice president Christina Foo acknowledged that by voting against the resolutions and for the motions, the members represented at the AGM had spoken.

“It’s now for the council to deliberate on these matters and to recommend the appropriate actions. If we need to follow up with the other authorities – and these issues do involve them – we will liaise with them,” she said.

According to Foo, the council meetings for the year had been pre-scheduled and it was up to MIA president Abdul Rahim Abdul Hamid to call for an emergency meeting if necessary.

At the start of the AGM in Kuala Lumpur, which lasted over four hours, a member questioned Abdul Rahim’s eligibility to chair the meeting, alleging that the president was not independent.

When members wanted to put this to a vote, Abdul Rahim instead stepped aside and Foo took over.

The dissenting mood continued when the resolutions and motions were tabled. The voting was via ballots, when it became clear that a show of hands would not go unquestioned.

One of the motions proposes that “necessary steps be taken so that all matters that affect only the rights of members in practice be voted upon only by members in practice.”

Another motion proposes that the MIA council takes steps to control the interview process for the issuing of audit licences, instead of a panel comprising various third parties and the MIA as the minority.

Subramaniam also proposed that there be a separate register for practitioners “so as to accord them with respective rights and obligations required to be in practice.”

The members at the AGM also agreed with the motion that the council should make efforts to abolish the need to renew audit licences every two years.

Subramaniam said if efforts to push for these changes through the MIA failed, it might be necessary for the practitioners to bypass the institute.

He is vice president of the Malaysian Association of Small and Medium Accounting Firms, which currently has about 50 members.

In contrast, the MIA has a total membership of almost 27,000. About two thirds of these are professional accountants in business, while a quarter of this population are in public practice.

According to the MIA’s latest annual report, as at June 30, it had 2,036 member firms, including 1,356 audit firms.

Industry insiders reckoned that at least 1,500 firms could be considered small.

TM Unifi Internet service leaves much to be desired

I STARTED subscribing to the Unifi internet service offered by TM Bhd, in June 2010.

Since the day my subscription commenced until the time of this letter, I have faced numerous and repeated problems with the Hypp TV and broadband Internet connection.

The Hypp TV reception eaves much to be desired as the picture quality is bad with frequent interruptions with “boxed” images.

As for the Internet connection, although I have subscribed for the 5MB package, the maximum I have experienced so far is only up to 3.9MB.

The wireless modem provided is of inferior quality and breaks down easily.

After changing to a new modem, the broadband speed decreased to 1MB or less.

I must admit that I received good response on my complaints to the service provider and they were very courteous too.

With the frequent interference, I felt shortchanged because I am still billed for the service at RM149 per month whereas the service provided was far inferior to my previous Streamyx connection, where I’m only required to pay RM66 per month.

I feel that until TM stabilises their Unifi service quality, clients who face such problems should be given rebates.

EAGER SUBSCRIBER,
Petaling Jaya.