Tag: World Trade Organization

Greg Baker/Agence France-Presse — Getty Images WASHINGTON — The United States and the European Union are preparing to impose tit-for-tat tariffs on each other’s products, the latest escalation in a 14-year fight over government aid given to Boeing and European rival Airbus. “The World Trade Organization finds that the European Union subsidies to Airbus has adversely impacted the United States, which will now put Tariffs on $11 Billion of E.U. It will soon stop!” The United States Trade Representative said on Monday night that it was preparing a list of European products to tax as retaliation for European subsidies to Airbus, which the World Trade Organization ruled were illegal in May 2018. The announcement of new tariffs stems from a dispute that began in 2004 related to government subsidies that Europe provides to Airbus, which is a rival to America’s Boeing. The United States requested the authority to impose retaliatory tariffs of $11.2 billion per year, and the two sides are awaiting a decision on the level of tariffs that the United States will be authorized to levy on the European Union. ends these harmful subsidies, the additional U.S. duties imposed in response can be lifted.” The European Commission indicated on Tuesday that it considers the $11 billion in retaliatory measures to be overblown and not justified by any findings by the World Trade Organization. In a statement, Boeing said it supported the United States Trade Representative and hoped that the draft tariff list would encourage the European Union “to comply with past W.T.O. However, they also have been quick to publicize the organization’s decisions when it finds in their favor. In its statement Monday, the Trump administration emphasized that its latest measures against the European Union would comply with the rules of the World Trade Organization. In a separate announcement Tuesday, the U.S. Trade Representative said the W.T.O.

The UK will be unable to have frictionless, tariff-free trade under World Trade Organization rules for up to seven years in the event of a no-deal Brexit, according to two leading European Union law specialists. The ensuing chaos could double food prices and plunge Britain into a recession that could last up to 30 years, claim the lawyers who acted for Gina Miller in the historic case that forced the government to seek parliament’s approval to leave the EU. It has been claimed that the UK could simply move to WTO terms if there is no deal with the EU. It is impossible to say how long it would go on for. There are two apparently insurmountable hurdles to the UK trading on current WTO tariffs in the event of Britain crashing out in March, said Howard. Firstly, the UK must produce its own schedule covering both services and each of the 5,000-plus product lines covered in the WTO agreement and get it agreed by all the 163 WTO states in the 32 remaining parliamentary sitting days until 29 March 2019. To make it more complicated, there are no “default terms” Britain can crash out on, Howard said, while at the same time, the UK has been blocked by WTO members from simply relying on the EU’s “schedule” – its existing tariffs and tariff-free trade quotas. The government cannot simply cut and paste the 120,000 EU statutes into UK law and then make changes to them gradually, Howard said. “Negotiating and ratifying the international free trade deals with the rest of the world alone could take over seven years,” she said. “The UK will have to start negotiating over 50 free trade agreements from scratch once we leave the EU.

Likely support in Commons: little more than the 202 seen on Tuesday if May secures no real changes. Quick guide Brexit and backstops: an explainer A backstop is required to ensure there is no hard border in Ireland if a comprehensive free trade deal cannot be signed before the end of 2020. As a result, the EU insists on having its own backstop - the backstop to the backstop - which would mean Northern Ireland would remain in the single market and customs union in the absence of a free trade deal, prompting fierce objections from Conservative hard Brexiters and the DUP, which props up her government. Under the plan the UK would have to join Norway, Liechtenstein and Iceland in the European Free Trade Association (Efta), which would then allow it to participate in the European Economic Area (EEA). The ‘plus’ in this option refers to a temporary customs union with the EU, which would need to be negotiated to avoid a hard border ion the island of Ireland. The temporary arrangement would remain in place until the EU and UK agreed a specific trade deal. Labour, the main proponent of the idea, says it would help businesses with supply chains and solve the Irish border issue. May argues that it goes against the referendum result as it would preclude the UK signing its own trade deals. Likely support in Commons: most of Labour’s 256 MPs would back this in a whipped vote. What is a customs union and why does it matter?

More than half of Conservative party members want Theresa May’s Brexit deal to be rejected in favour of leaving the EU with no deal, according to a survey. Standfirst ... unknown title 0 10 20 30 40 50 Leave the EU without a deal 57% Leave the EU with the proposed deal 23 Remain a member of the EU 15 Guardian Graphic | Source: ESRC. Sample size: 1,215 Conservative party members In a three-way referendum, with the options of leaving without a deal, staying in the EU or leaving with May’s deal, 57% preferred leaving without a deal. Only 23% of members said they would vote for May’s deal in a three-way referendum. Just 29% of Tory members would vote for May’s deal, compared with 64% who would vote to leave without a deal, if there was a two-option referendum. Sample size: 1,215 Conservative party members Among party members, opposition to the deal negotiated by their own leader outweighs support by a margin of 59% to 38%. More members (53%) think May’s deal does not respect the 2016 EU referendum result than the 42% who think it does. Sample size: 1,215 Conservative party members Tory divisions: the factions preparing for fall of May's Brexit deal Read more The findings are a further blow to May, who hopes to win a majority in parliament for her EU deal, which is expected to be put to the vote later in January. The research showed that a greater proportion of Tory members think the government has made a mess of negotiating Brexit than those who just support the party. But the poll of party members found that 68% of Tory members think the government is doing badly at negotiating the country’s exit from the EU – a proportion that rises to 78% of those party members who voted leave in 2016.

An interim prime minister would have to be chosen while the Tory party plans a leadership contest. She asks for concessions over the Irish backstop, and then puts whatever she can secure to a second vote in the Commons. If Labour officially backs the idea, a second referendum –as suggested by Keir Starmer, the shadow Brexit secretary – could happen. With more than 100 Conservative MPs lining up to vote against the Brexit deal, May made the humiliating admission to the Commons that “if we went ahead and held the vote tomorrow the deal would be rejected by a significant margin”. As well as meeting Merkel, May will fly out to meet Mark Rutte, the Dutch prime minister, in the Hague, on Tuesday morning and is expected to meet Donald Tusk, the president of the European council, and the European commission president, Jean-Claude Juncker, in Brussels. Tusk said he would allow May to discuss Brexit at the end of the week, but made clear that there were limits to what the EU was willing to do. Quick guide Brexit and backstops: an explainer A backstop is required to ensure there is no hard border in Ireland if a comprehensive free trade deal cannot be signed before the end of 2020. As a result, the EU insists on having its own backstop - the backstop to the backstop - which would mean Northern Ireland would remain in the single market and customs union in the absence of a free trade deal, prompting fierce objections from Conservative hard Brexiters and the DUP, which props up her government. “I have no difficulty with statements that clarify what’s in the withdrawal agreement [like Gibraltar], but no statement of clarification can contradict what’s in it,” Varadkar said. A backstop is deemed necessary to avoid a hard border in Ireland if the UK and the EU cannot agree a free trade agreement by the end of the Brexit transition period in 2020.

Former deputy prime minister Lord Heseltine will warn politicians that Britain’s youth will “never forgive us” unless they are offered the chance to reverse Brexit. The Conservative veteran, 85, will address a rally calling for a second referendum ahead of Tuesday’s crunch Commons vote on Theresa May’s Brexit deal. Remain leaders and rivals gear up for second referendum campaign, with new pledge on NHS funding Read more He will claim that the government appears to have “lost control” and there were signs that MPs were prepared to take action to “assert the authority” of parliament. Quick guide Vote on Brexit deal: what could happen next? An interim prime minister would have to be chosen while the Tory party plans a leadership contest. Brexit is dropped without a second referendum If there is no agreement on anything, and “no deal” has been blocked off as an option by parliament, the other choice available is no Brexit. At the rally in London’s ExCel centre, which will also be addressed by politicians including Liberal Democrat leader Sir Vince Cable, Tory former ministers Anna Soubry and Philip Lee, and celebrities including Charles Dance and Jason Isaacs, Heseltine will claim that those campaigning for a second vote are “British patriots” who are “proud of our Commonwealth and empire”. We want a Britain at the heart of Europe because we want the voice of Britain, the tolerance of Britain, the culture of Britain, at the heart of Europe. ‘I certainly won’t be here.’ But neither will my generation. “Trying to negotiate trade deals on behalf of the United Kingdom in competition with a European Union six times our size offering bigger, better deals behind closed doors.” Heseltine will add: “No one can predict the events of next week.

Theresa May rejects Donald Trump's criticism of Brexit deal Read more In a damning report released on Wednesday, MPs said businesses and members of the public had not been given adequate information about what might happen. They highlighted the department’s use of non-disclosure agreements (NDAs) while negotiating with the transport industry as hampering the spread of information. Quick guide What happens next if May's Brexit deal is voted down? MPs knuckle under and vote it through. A new leader then tries to assemble a majority behind a tweaked deal. Labour tries to force an election The opposition tables a vote of no confidence. If May lost, the opposition (or a new Conservative leader) would have two weeks to form an alternative government that could win a second confidence vote. Transport department officials have called the £35m project Operation Brock. “The slow progress and poor communication around work to avoid this through schemes such as Project Brock concerns us,” it said. The department on Monday opened applications from hauliers for internal road haulage permits, known as ECMT permits, which will be needed for British lorries to travel across the Channel in the event of a no-deal Brexit.

A fortnight ago, Jacob Rees-Mogg, David Davis, Steve Baker, Boris Johnson and other leading members of the European Research Group squeezed themselves into a Westminster committee room to share their excitement at having found a single economist who was optimistic about Brexit. Here was the way forward. Happy days all round. IEA's Brexit proposals: the main points Read more Until today, when many of the usual suspects – with the exception of Boris, who tweeted his undying solidarity with anything and anyone that helped him become Tory leader – rattled around in a barely half full Gladstone library of the Liberal Club to tell a handful of reporters that – much to their surprise – they had found a second economist who was tremendously enthusiastic about Brexit. Fickle doesn’t begin to describe them. The problem with the Brexit negotiations so far, he declared confidently, was that we had been treating them as a problem singular to the UK and the EU. PM urged to drop Chequers in order to win 'Brexit prize' Read more What we should have been doing is signing loads of other trade deals with the US and the rest of the world behind the EU’s back – the US was apparently just gagging to do deals before it knew what final trade arrangement we had agreed with the EU – because the EU would definitely never have found out was going on and pointed out its illegality, said the country’s leading trade lawyer, failing to grasp the basics of international trade. As if to prove he really was as stupid as he sounded, Singham went on to suggest that post-Brexit, the UK might do some individual trade deals with separate EU countries. Which explained both why he had invariably come off worse in all negotiations and why he had done almost nothing during his time as Brexit secretary. While everyone seemingly agreed Brexit was a terrible idea, the party leadership seemed to think the solution lay in only offering people a vote on a bad deal or an even worse deal.

Donald Trump has defended his controversial positions on tariffs and trade, even as global markets were buffeted by a disappointing start to the second half of the year. At a meeting with the prime minister of the Netherlands, Mark Rutte, in the Oval Office on Monday, the president mused that the World Trade Organization had mistreated the US: “I hope they change their ways. They have been treating us very badly for many, many years and that’s why we were at a big disadvantage with the WTO. “We’re not planning anything now, but if they don’t treat us properly we will be doing something,” Trump added. Trump's EU trade war costing manufacturers in US and eurozone Read more At the same meeting, the president said his negotiators were “very close to making some very good trade deals – fair trade deals, I don’t want to say good, I want to say fair – fair trade deals for our taxpayers, and for our workers and for our farmers.” Trump’s comments came even as signs mounted that administration policies on global trade were beginning to bite. Goldman Sachs warned the second half of 2018 would be tough for investors as they grapple with rising tariffs and interest rates, while the latest survey of American factories by IHS Markit found that tariffs were driving up costs for US manufacturers and exacerbating a slowdown for eurozone members. In another stark warning, JP Morgan warned that a full-blown trade war would punch a hole in global economic growth because of reduced trade volume, supply chain disruptions and lost confidence. John Normand, the bank’s head of cross-asset fundamental strategy, said he believed that the worst-case scenario could reduce global growth by a “material” amount of at least 1.4% over the next two years. Some effects are already being felt. The largest US nail manufacturer, Mid-Continent Nail, has laid off 60 workers and said it might be out of business by the end of the summer.

America has announced successive protectionist tariffs pursuant to its domestic laws, forcing China to take counter-measures. The so-called “investigations” under legislation, such as section 301 of the US Trade Act of 1974, risk igniting a trade war between the world’s two biggest economies. There would be no winner in a trade war. If the Trump administration, by announcing unilateral protectionist measures, believes there could be, it must be suffering the damaging after-effects of the years in which it had a hegemonic mindset. The US's actions are tantamount to returning the international trade order to the law of the jungle For the most recent “safeguard” tariffs – on steel by the Bush administration and on tyres from China by the Obama administration – all backfired. These rules have contributed hugely to global trade and economic growth. China has set the goal of importing $24tn of goods in the next 15 years. It is China’s consistent position to address trade disputes through negotiations and consultations. The US should bear in mind the long-term and fundamental interests of both countries, as well as the need for a solid international trade order and sound world economy. There is a dark cloud: but as long as the international community joins hands to safeguard the rules of international trade and to firmly oppose protectionism, I believe it can be dispelled.