The global trade system and the international investment system face significant turning points at the end of this year, one that was postponed when China joined the World Trade Organization almost 15 years ago. The United States (US) and the European Union (UE) must decide whether they will begin to treat China as a “market economy” in their trade and investment policies. Unfortunately, even as the battle escalates over the course of this year, the terms of the choice ensure that nothing will be done to address the global trade and international investment regimes’ deeper flaws.
China’s WTO accession agreement, signed in December 2001, permitted the country’s trade partners to deal with China as a “non-market economy” (NME) for a period of up to 15 years. NME status made it a lot easier for importing countries to impose special tariffs on Chinese exports, in the form of antidumping duties. In particular, they could use production costs in more expensive countries as a proxy for true Chinese costs, increasing both the likelihood of a dumping finding and the estimated margin of dumping.
Today, though many countries, such as Argentina, Brazil, Chile and South Korea, have already rewarded China with market-economy status, the world’s two biggest economies, the US and the EU, have not. But, regardless of whether they do, antidumping measures are ill-suited to the task of addressing concerns about unfair trade – not because such concerns are ungrounded, but because they go well beyond dumping. Antidumping facilitates protectionism of the worst kind, while doing nothing for countries that need legitimate policy space.
China's latest proposed list of industries that would be off-limits to foreign investors shows more work is needed to agree on a new investment treaty with the United States, U.S. Commerce Secretary Penny Pritzker said in an interview on Monday (on June 27).
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La fase decreciente del precio de las materias primas afectó la composición sectorial de la inversión extranjera
Two outstanding personalities, G. K. Chesterton and Hilaire Belloc, were the most prominent disseminators of the ideas of Distributism. They were the main advocates of the Catholic’s Social Doctrine of Subsidiarity as expounded by Pope Leo XIII in Rerum novarum (1891), a doctrine that would be re-stated, re-confirmed and reinforced by Pope Pius XI in Quadragesimo anno (1931) and by Pope John Paul II in Centesimus annus (1991). As such, it is important, first and foremost to see Distributism as a derivative of the Principle of Subsidiarity. This principle is clearly described in the Church's Social Doctrine Compendium (186-187) according to which "a community of a higher order should not interfere in the internal life of a community of a lower order, depriving the latter of its functions, but rather should support it in case of need and help to co-ordinate its activity with the activities of the rest of society, always with a view to the common good.” In other words, it states that the rights of small communities should not be violated or usurped by the intervention of larger communities or the state. This principle applies to Distributism on account that property ownership is a fundamental right and the means of production should be spread as widely as possible, including the idea of cooperativism. In a way, distributism seeks to subordinate economic activity to the well being of human life as a whole. The Video that follows took place at the Acton Institute on february 18th with an interesting debate for and against this principle and this doctrine.