Archive

Archive for the ‘trade’ Category

SIGAR — Afghan Customs: U.S. Programs Have Had Some Successes, but Challenges Will Limit Customs Revenue as a Sustainable Source of Income for Afghanistan

April 29, 2014 Comments off

Afghan Customs: U.S. Programs Have Had Some Successes, but Challenges Will Limit Customs Revenue as a Sustainable Source of Income for Afghanistan (PDF)
Source: Special Inspector General for Afghanistan Reconstruction

A nation’s ability to control its borders is essential in controlling the flow of licit and illicit goods and assessing appropriate tariffs and customs duties. Customs revenue is a major component of Afghanistan’s national budget, which is currently funded through a combination of domestic revenue collections and aid from international donors. For Afghanistan’s 3 most recent fiscal years, customs revenue collections produced $698 million-$1.1 billion annually, accounting for 44-48 percent of total domestic revenue collection. However, domestic revenues continue to fall short of expenditures, and international assistance is expected to decline in coming years. As a result, increasing the Afghan government’s collection of domestic revenues is a main objective of both the U.S. and Afghan governments.

According to USAID, CBP, and TAFA officials, corruption impacts all levels of the customs process and is the biggest problem affecting Afghan customs processes and revenues. The scale and impact of corruption in Afghanistan’s customs process is difficult to quantify. Nevertheless, USAID and ACD officials hypothesize that eliminating or significantly reducing corruption in the customs process could potentially double the customs revenues remitted to the central government. The BMTF also noted that criminal networks use intimidation to smuggle commodities, resulting in the estimated loss of approximately $25 million annually for wheat and rice imports at a single customs location. In a separate estimate, TAFA officials stated that approximately $60 million is lost annually to commercial smuggling. Further complicating efforts to combat criminal and patronage networks are reports from BMTF advisers that Afghan employees are being kidnapped and intimidated because they are listening to the BMTF advisers and properly collecting customs duties.

To help reduce corruption, the Afghan and U.S. governments proposed streamlining and automating customs processes. Two major innovations in the automation of customs processes—a risk management system and an electronic payment system—were started under TAFA. The risk management system, created to facilitate the targeted inspection of imported cargo, is designed to optimize the use of limited security resources and decrease transit times. While the ACD accepted the risk management system in principle, it reportedly considered it too difficult to operate and chose to adopt a scaled down approach, with the successive implementation of specific parts of the risk management system over a period of years.

Similarly, progress in implementing an electronic payment system for customs duties has been slow. Currently, customs fees in Afghanistan are processed in cash at the inland customs depots where the imported cargo is inspected and assessed customs duties. This system can lead to customs brokers traveling long distances with large quantities of cash to pay customs fees assessed on imported goods. The current cash-based payment system is inefficient, leaves customs brokers vulnerable to theft, and increases the opportunities for corruption. According to USAID and TAFA program officials, at the conclusion of the TAFA programs in August 2013, the ACD had the equipment and technical knowledge needed to launch a pilot system. However, USAID officials stated that the electronic payment system was delayed, due in part, to a proposal by an Afghan official to allow only one Afghan bank to process all of the electronic customs payments. This arrangement would have given the selected bank a significant and improper advantage over its competitors. Although the risk management and the electronic payment systems are highlighted in the TAFA and ATAR contract documents as important anti-corruption measures, SIGAR found that the ATAR contract does not require the implementing partner to meet annual targets for implementing these systems.

About these ads

CRS — NAFTA at 20: Overview and Trade Effects

April 25, 2014 Comments off

NAFTA at 20: Overview and Trade Effects (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

The North American Free Trade Agreement (NAFTA) entered into force on January 1, 1994. The agreement was signed by President George H.W. Bush on December 17, 1992, and approved by Congress on November 20, 1993. The NAFTA Implementation Act was signed into law by President William J. Clinton on December 8, 1993 (P.L. 103-182). The overall economic impact of NAFTA is difficult to measure since trade and investment trends are influenced by numerous other economic variables, such as economic growth, inflation, and currency fluctuations. The agreement may have accelerated the trade liberalization that was already taking place, but many of these changes may have taken place with or without an agreement. Nevertheless, NAFTA is significant because it was the most comprehensive free trade agreement (FTA) negotiated at the time and contained several groundbreaking provisions. A legacy of the agreement is that it has served as a template or model for the new generation of FTAs that the United States later negotiated and it also served as a template for certain provisions in multilateral trade negotiations as part of the Uruguay Round.

International VAT/GST Guidelines

April 25, 2014 Comments off

International VAT/GST Guidelines
Source: Organisation for Economic Co-operation and Development

The Guidelines seek to address the problems that arise from national VAT systems being applied in an uncoordinated way. They set standards that should ensure neutrality in cross-border trade and a more coherent taxation of business-to-business (B2B) trade in services.

Contents:
Chapter 1. Core features of VAT
Chapter 2. Neutrality of VAT in the context of cross-border trade
Chapter 3. Place of taxation for B2B cross-border supplies of services and intangibles

Global flows in a digital age

April 24, 2014 Comments off

Global flows in a digital age
Source: McKinsey & Company

Global flows have been a common thread in economic growth for centuries, since the days of the Silk Road, through the mercantilist and colonial periods and the Industrial Revolution. But today, the movement of goods, services, finance, and people has reached previously unimagined levels. Global flows are creating new degrees of connectedness among economies—and playing an ever-larger role in determining the fate of nations, companies, and individuals; to be unconnected is to fall behind.

Flows of goods, services, and finance reached $26 trillion in 2012, or 36 percent of global GDP, 1.5 times the level in 1990. Now, one in three goods crosses national borders, and more than one-third of financial investments are international transactions. In the next decade, global flows could triple, powered by rising prosperity and participation in the emerging world and by the spread of the Internet and digital technologies. Our scenarios show that global flows could reach $54 trillion to $85 trillion by 2025, more than double or triple their current scale.

CRS — What Is the Farm Bill? (updated)

April 22, 2014 Comments off

What Is the Farm Bill? (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

The farm bill is an omnibus, multi-year piece of authorizing legislation that governs an array of agricultural and food programs. Titles in the most recent farm bill encompassed farm commodity price and income supports, farm credit, trade, agricultural conservation, research, rural development, bioenergy, foreign food aid, and domestic nutrition assistance. Although agricultural policies sometimes are created and changed by freestanding legislation or as part of other major laws, the farm bill provides a predictable opportunity for policy makers to comprehensively and periodically address agricultural and food issues. The farm bill is renewed about every five years.

Fueling a New Order? The New Geopolitical and Security Consequences of Energy

April 21, 2014 Comments off

Fueling a New Order? The New Geopolitical and Security Consequences of Energy
Source: Brookings Institution

The paper Fueling a New Order? The New Geopolitical and Security Consequences of Energy examines impacts of the major transformation in international energy markets that has begun. The United States is poised to overtake Saudi Arabia and Russia as the world’s largest oil producer and, combined with new developments in natural gas, is on track to become the dominant player in global energy markets. Meanwhile, China is in place to surpass the United States in its scale of oil imports, and has already edged out the U.S. in carbon emissions.

CRS — Brazil: Political and Economic Situation and U.S. Relations

April 17, 2014 Comments off

Brazil: Political and Economic Situation and U.S. Relations (PDF)
Source: Congressional Research Service (via National Agricultural Law Center)

The United States has traditionally enjoyed cooperative relations with Brazil, which is the seventh-largest economy in the world and is recognized by the Obama Administration’s National Security Strategy as an emerging center of influence. Administration officials have often highlighted Brazil’s status as a multicultural democracy, referring to the country as a natural partner that shares values and goals with the United States. Bilateral ties have been strained from time to time, however, as the countries’ occasionally divergent national interests and independent foreign policies have led to disagreements. U.S.-Brazilian relations have been particularly strained over the past year as a result of alleged National Security Agency (NSA) activities inside Brazil. Nevertheless, the countries continue to engage on issues such as trade, energy, security, racial equality, and the environment.

CRS — Sanitary and Phytosanitary (SPS) and Related Non-Tariff Barriers to Agricultural Trade

April 17, 2014 Comments off

Sanitary and Phytosanitary (SPS) and Related Non-Tariff Barriers to Agricultural Trade (PDF)
Source: Congressional Research Service (via National Agricultural Law Center)

Sanitary and phytosanitary (SPS) measures are the laws, rules, standards, and procedures that governments employ to protect humans, animals, and plants from diseases, pests, toxins, and other contaminants. Examples include meat and poultry processing standards to reduce pathogens, residue limits for pesticides in foods, and regulation of agricultural biotechnology. Technical barriers to trade (TBT) cover technical regulations, product standards, environmental regulations, and voluntary procedures relating to human health and animal welfare. Examples include trademarks and patents, labeling and packaging requirements, certification and inspection procedures, product specifications, and marketing of biotechnology. SPS and TBT measures both comprise a group of widely divergent standards and standards-based measures that countries use to regulate markets, protect their consumers, and preserve natural resources.

According to the World Trade Organization (WTO), SPS and TBT measures have become more prominent concerns for agricultural exporters and policy makers, as tariff-related barriers to trade have been reduced by various multilateral, regional, and bilateral negotiations and trade agreements. The concerns include whether SPS and TBT measures might be used to unfairly discriminate against imported products or create unnecessary obstacles to trade in agricultural, food, and other traded goods. Notable U.S. trade disputes involving SPS and TBT measures have included a European Union (EU) ban on U.S. meats treated with growth-promoting hormones and also certain pathogen reduction treatments, and an EU moratorium on approvals of biotechnology products, among other types of trade concerns with other countries. Foreign countries have also objected to various U.S. trade measures.

CRS — Small Business Administration Trade and Export Promotion Programs

April 17, 2014 Comments off

Small Business Administration Trade and Export Promotion Programs (PDF)
Source: Congressional Research Service (via National Agricultural Law Library)

According to Census data, approximately 1% of small businesses in the United States currently export. With roughly three-quarters of world purchasing power and almost 95% of world consumers living outside of U.S. borders, more attention is being paid to the potential of small business export promotion programs to grow small businesses and contribute to the national economic recovery. In addition, some Members of Congress believe that the contributions of small businesses to commercial innovation and economic growth could be enhanced through greater access to growing international markets.

Consistent with these policy goals, the Small Business Administration (SBA) provides export promotion and financing services to small businesses through its loan guarantee programs, management and training programs, and other initiatives. SBA’s Office of International Trade (OIT) coordinates these activities as it assists with four stages of export promotion: (1) identifying small businesses interested in export promotion; (2) preparing small businesses to export; (3) connecting small businesses to export opportunities; and (4) supporting small businesses once they find export opportunities.

CRS — Trade Adjustment Assistance for Farmers

April 17, 2014 Comments off

Trade Adjustment Assistance for Farmers (PDF)
Source: Congressional Research Service (via National Agricultural Law Library)

The Trade Adjustment Assistance for Farmers (TAAF) program provides technical assistance and cash benefits to producers of agricultural commodities and fishermen who experience adverse economic effects caused by increased imports. Congress first authorized this program in 2002, and made significant changes to it in the 2009 economic stimulus package (P.L. 111-5). The 2009 revisions were intended to make it easier for commodity producers and fishermen to qualify for program benefits, and provided over $200 million in funding through December 2010. Subsequently, P.L. 112-40 (enacted in October 2011) authorized $202.5 million through December 2013. No program activity occurred, because Congress did not appropriate funds.

The U.S. Department of Agriculture (USDA) is required to follow a two-step process in administering TAAF program benefits. First, a group of producers must be certified eligible to apply. Second, a producer in a certified group must meet specified requirements to be approved to receive technical assistance and cash payments.

CRS — U.S. Crude Oil Export Policy: Background and Considerations

April 17, 2014 Comments off

U.S. Crude Oil Export Policy: Background and Considerations (PDF)
Source: Congressional Research Service (via National Agricultural Law Center)

During an era of oil price controls and following the 1973 Organization of Arab Petroleum Exporting Countries oil embargo, Congress passed the Energy Policy and Conservation Act of 1975 (EPCA), which directs the President “to promulgate a rule prohibiting the export of crude oil” produced in the United States. Crude oil export restrictions are codified in the Export Administration Regulations administered by the Bureau of Industry and Security (BIS)—a Commerce Department agency. The President has some powers to allow certain crude oil exports if an exemption is determined to be in the national interest.

Ratifying and Implementing Trade and Investment Treaties in Canada

April 15, 2014 Comments off

Ratifying and Implementing Trade and Investment Treaties in Canada
Source: Parliamentary Library of Canada

Under Canada’s constitutional system, the conduct of foreign affairs is a royal prerogative power of the federal Crown.

Consequently, the Executive Branch has the exclusive power to negotiate and conclude international treaties. Parliament has the exclusive power to enact legislation to implement those treaties.

As Canada continues to enter into such treaties, a number of important questions arise:

  • What is the interaction between Canadian and international law in the treaty-making and implementation processes, particularly in relation to trade and investment?
  • What measures must the Executive and Legislative branches take so that these treaties can come into force?
  • What formal role do the provinces and territories play in the negotiation, ratification and implementation of trade and investment treaties?

Tech Trade in the States: A State by State Overview of International Trade in Tech Goods

April 14, 2014 Comments off

Tech Trade in the States: A State by State Overview of International Trade in Tech Goods (PDF)
Source: Tech America Foundation

TechAmerica Foundation proudly presents our 2014 edition of Tech Trade in the States: A State-by-State Overview of International Trade of Tech Goods. It provides 2012 data on tech trade at the national level and export data for all 50 states, the District of Columbia, and Puerto Rico. The report also provides an estimate as to the number of jobs that are supported by export activities.

China’s Hunger for U.S. Planes and Cars: Assessing the Risks

April 8, 2014 Comments off

China’s Hunger for U.S. Planes and Cars: Assessing the Risks (PDF)
Source: U.S.-China Economic and Security Review Commission

The U.S. trade deficit with China continues to grow but at a slower rate. A key reason for this is the boom in U.S. automotive and aerospace shipments to China. As China becomes more affluent and urbanized, ordinary Chinese are driving more cars and traveling more by frequently by air. China’s future demand, however, could be affected by pollution, traffic bottlenecks, and other factors. U.S. companies must also contend with China’s industrial policy, which tilts the playing field toward domestic industry. In the long run, technology transfer and off-shoring could erode U.S. competitiveness and take business away from U.S. plants.

The Trade Deficit: The Biggest Obstacle to Full Employment

April 7, 2014 Comments off

The Trade Deficit: The Biggest Obstacle to Full Employment
Source: Center for Economic and Policy Research

Dean Baker argues that taking aim at the persistent trade deficit, through which the United States exports labor demand, would help a great deal in moving the job market toward full employment. Moreover, he argues that trade is a “policy variable,” amenable to interventions that push back against competitors who place a fat thumb on the exchange-rate scale to keep their imports cheap and our exports expensive.

Baker notes various ideas that could counter currency management. First, the US could pass legislation that gave the government the right to treat currency management as a violation of international trading rules, leading to offsetting tariffs. Second, we could also tax foreign holdings of United States Treasuries, making the usual tactic of currency managers more expensive. Third, we could institute reciprocity into the process of currency management: If a country wants to buy our Treasuries, we must be able to buy theirs.

CRS — Financing the U.S. Trade Deficit (updated)

April 7, 2014 Comments off

Financing the U.S. Trade Deficit (PDF)
Source: Congressional Research Service (via U.S. State Department Foreign Press Center)

The U.S. merchandise trade deficit is a part of the overall U.S. balance of payments, a summary statement of all economic transactions between the residents of the United States and the rest of the world, during a given period of time. Some Members of Congress and other observers have grown concerned over the magnitude of the U.S. merchandise trade deficit and the associated increase in U.S. dollar-denominated assets owned by foreigners. International trade recovered from the global financial crisis of 2008-2009 and the subsequent slowdown in global economic activity that reduced global trade flows and, consequently, reduced the size of the U.S. trade deficit. Now, however, U.S. exporters face new challenges with economies in Europe and Asia confronting increased risks of a second phase of slow growth. This report provides an overview of the U.S. balance of payments, an explanation of the broader role of capital flows in the U.S. economy, an explanation of how the country finances its trade deficit or a trade surplus, and the implications for Congress and the country of the large inflows of capital from abroad.

USITC — Trade Barriers that U.S. SMEs Perceive as Affecting Exports to the EU

April 4, 2014 Comments off

Trade Barriers that U.S. SMEs Perceive as Affecting Exports to the EU
Source: U.S. International Trade Commission

Standards and a variety of other trade barriers in the European Union disproportionately affect the exports of U.S. small and medium-sized enterprises more than those of large firms, reports the U.S. International Trade Commission (USITC) in its new publication Trade Barriers that U.S. Small and Medium-Sized Enterprises Perceive as Affecting Exports to the European Union.

The USITC, an independent, nonpartisan, factfinding federal agency, completed the report for the U.S. Trade Representative.

As requested, the report catalogs trade-related barriers that U.S. small and medium-sized enterprises (SMEs) and related industry associations reported as limiting their exports to the European Union (EU). Highlights of the report follow.

SMEs explained that many EU trade barriers, particularly those related to standards and regulations, affect their exports. They stated that complying with EU regulations and procedures are costly for all firms, but potentially prohibit SMEs from exporting to the EU because such costs are often the same regardless of a firm’s size or export revenue. Other difficulties that were cited include protection of trade secrets, high patenting costs, and logistics challenges, especially customs requirements, inconsistent Harmonized System classifications, and the EU’s value-added tax system.

  • SMEs and related industry associations described many industry-specific barriers. For example:
  • SMEs in the chemical industry frequently cited the high cost of complying with the EU chemical regulation (Registration, Evaluation, Authorisation and Restriction of Chemicals or REACH).
  • SMEs exporting cosmetics expressed difficulties meeting the EU’s cosmetics directive.
  • SME clothing exporters said that they were disproportionately affected by the recent EU retaliatory additional duties on U.S. exports of women’s denim jeans.
  • SMEs producing machinery, electronic, transportation, and other goods cited a lack of harmonized international standards and mutual recognition for conformity assessment, as well as problems complying with technical regulations and conformity assessment procedures.

A number of barriers reportedly constrain U.S. exports of agricultural products. SMEs and industry groups in the corn, dried fruit, animal feed, cheese, and wheat industries cited high tariffs, stringent and inconsistent EU rules and testing mandates, lack of a science-based regulatory focus (especially for genetically modified traits), lack of harmonization between U.S. and EU standards, and the EU’s protected designations of origin (PDOs). The U.S. poultry and lamb industries reported that they are effectively banned from exporting to the EU.
U.S. services SMEs in the healthcare, engineering, testing, and audiovisual industries highlighted a lack of mutual recognition of licensing, credentials, and standards, as well as issues with broadcasting and film quotas, language dubbing requirements, government subsidies, and safeguarding intellectual property.
In certain industries, SMEs or industry associations also provided suggestions for increasing U.S. SME transatlantic trade with the EU and, at times, stories of successfully exporting to the EU.

Think Tank Review — Special Issue — EU-US Relations

March 27, 2014 Comments off

Think Tank Review — Special Issue — EU-US Relations
Source: General Secretariat of the Council of the EU (Central Library)

On the occasion of the EU-US Summit we compiled the first Special Issue of the Think Tank Review, featuring publications on EU-US relations referenced in the Think Tank Reviews since its inception in late 2013. The collection has an obvious focus on the negotiations of the Transatlantic Trade and Investment Partnership (TTIP), however we also found analyses all other recent highlights in transatlantic relations, from security to finance.

AU — The G20: a quick guide

March 26, 2014 Comments off

The G20: a quick guide
Source: Parliamentary Library of Australia

This is a quick guide to basic information about the G20, as well as links to useful summary resources. The G20 background section includes the G20’s history, its members, the hosting system and G20 meeting processes, as well as a brief discussion of selected policy areas. Material on Australia and the G20 includes Australia’s involvement in the G20, Australia’s G20 goals for 2014 and speeches and press releases on the G20. A short list of links provides access to more resources on the G20.

Value of 2013 U.S.-NAFTA Freight on Surface Modes Rose from 2012; Declined on Air and Vessel

March 25, 2014 Comments off

Value of 2013 U.S.-NAFTA Freight on Surface Modes Rose from 2012; Declined on Air and Vessel
Source: Bureau of Transportation Statistics

Three of the five transportation modes – the surface transportation modes of truck, rail and pipeline – carried more U.S. trade with North American Free Trade Agreement (NAFTA) partners Canada and Mexico by value in 2013 than in 2012 while the value of freight transported by air and vessel decreased, according to the U.S. Department of Transportation’s Bureau of Transportation Statistics (BTS) (Figure 1 and Table 2).

Trade by pipeline also grew the most from year-to-year, 7.7 percent, partly due to the value of petroleum products, as the overall value on all modes rose 2.6 percent. Smaller increases took place on rail (4.6 percent) and truck (2.2) while vessel trade fell for the second consecutive year (-2.4) and air trade declined for the third straight year (-1.0) (Tables 1, 2).

Follow

Get every new post delivered to your Inbox.

Join 857 other followers