US-China trade – will the two economic powerhouses be able to negotiate away the trade tensions and tariffs? They have negotiated a Phase One deal which is scheduled to be signed in January. But we have been here before. The mutual mistrust means that all bets are off until the deal is actually inked.
USMCA – NAFTA 2.0 – will it finally take effect in 2020? First negotiated in 2018 and ratified by Canada and Mexico, the US-Mexico-Canada Agreement (USMCA) was revamped in December 2019 to win support from Democrats in US Congress. The new text will need to be ratified by all three USMCA parties.
Tariffs & Retaliatory Tariffs – will less blunt instruments be found to address trade tensions? Tariffs imposed by the Trump Administration on aluminum and steel imports, on Chinese imports, now threatened on additional Chinese and EU imports, and the countries’ retaliatory tariffs threaten to reduce economic output, income, and employment.
Growing Paralysis of the WTO – Will WTO members find the will to make the needed reforms? The WTO Dispute Settlement Mechanism is now effectively paralyzed as the Appellate Body no longer has enough members to allow it to review appeals from panel decisions. The 11th Ministerial of the World Trade Organization (WTO), held in December 2017, highlighted the institutional challenges facing the WTO and its ability to effectively make the rules that govern the multilateral trading system. We also note the delay of the 12th WTO Ministerial Conference, which won’t be held until June 2020 in Kazakhstan.
RCEP – Largest Global Trade Deal excludes the United States and could be signed in 2020. Despite the defection of India, the Regional Comprehensive Economic Partnership (RCEP), which will include China and 15 other Asia-Pacific countries, seems on track for signature in 2020.
Investor-State Dispute Settlement (ISDS) – How will ISDS be reformed? ISDS provisions, which permit a foreign investor to sue a host State, are contained in about 3,000 investment treaties and investment chapters of free trade agreements. Growing concerns about abuse and inequities have initiated several reform efforts, which bear watching in 2020.
What issues are you following or would like to know more about? Let us know!