On Tuesday January 29 2019, WITA hosted its inaugural Washington International Trade Conference (WITC). At the event, WITA hosted a panel of ambassadors to the United States to discuss future implications of current trade agreements and relations with the United States.
Trade Around the World
By: Madelyn Cunningham
The concluding panel of the 2020 Washington International Trade Conference was “Trade Around the World,” a discussion featuring ambassadors H.E. Fitsum Arega, Ambassador of Ethiopia, H.E. Rosemary Banks, Ambassador of New Zealand, H.E. Stavros Lambrinidis, Ambassador of the European Union, and H.E. Ashok Kumar Mirpuri, Ambassador of Singapore. Laura Lane, President of Global Affairs for UPS, moderated the discussion through trade relations and FDI between their countries and the United States and the dissolution of the Appellate Body in the WTO.
Laura Lane opened the panel by discussing the relationship between Singapore and the United States, asking Ambassador Mirpuri to talk about this partnership and possible trade interests of Singapore in the future. Ambassador Mirpuri starts by stating the growing importance of trade in the political sphere, acknowledging that while the audience may have some familiarity with Singapore whether that be through business or the trade relationship with the United States, Singapore is a hyper-globalized country driven by trade.
Trade drives the Singaporean economy, but H.E. Mirpuri brought up the new challenges regarding issues of trade and expressed the need to identify where global trade will be going because of geopolitical conflict, recent anti-globalization and protectionist efforts, and the fourth wave of industrialization. To address these issues and changes, Mirpuri expressed that through the U.S. – Singapore trade relationship, Singapore has shifted its mindset towards future problems and adjusting in this age of digitization and global changes.
Ambassador Mirpuri stressed the need for a rules-based system in the WTO, explaining that for small countries especially, there must be an established system of rules and operations in order for the world dispute settlement process to be fully functioning. To account for the current instability in the WTO and the changing trade atmosphere with digitization, Ambassador Mirpuri identified how Singapore has been adapting.
Mirpuri stated that last month, partnered with New Zealand and Chile, Singapore concluded the Digital Economic Partnership Agreement (DEPA), and hopes agreement will act as a “pathfinder” for e-commerce. Another significant change was the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which is currently going through the ratification process.
Moderator Lane then shifted the conversation to bring in New Zealand Ambassador, H.E. Rosemary Banks, asking where she saw the U.S. – New Zealand relationship currently, and the issues on New Zealand’s trade agenda. Ambassador Banks brought up research recently done on the relationship between New Zealand and the United States, which concluded that the first time the country asked for a reciprocal trade agreement with the U.S. was in 1939. She stated that while trade relationships can take a long time, 80 years is a little excessive.
Ambassador Banks then brought up the direction of New Zealand trade policy, she stated that over the last 25 years, there has been significant emphasis on negotiating comprehensive bilateral agreements, establishing relationships with Asian Pacific countries, and maintaining global influence through existing trade agreements. While this has worked in favor of New Zealand, there is worry over taking assumptions of the three-pronged system for granted and the response to encourage the “open-pluralism approach”. Banks called back to Zoellick’s point in his remarks regarding the gap in systems for the process of creating new laws and rules.
Ambassador Banks expressed New Zealand’s excitement to head as the APEC Chair of 2021 in the form of a work program to be established this year, stating that there is a great need for multilateral trade relationships and a functioning and comprehensive dispute settlement system for trade issues. Banks concluded by answering a question asked in Ambassador Zoellick’s session regarding the importance of international trade.
To this, she brought up the “Trade for All Initiative”, a country-wide exercise that involved a consultation to listen to the entire population about their vision for trade policy. Through this consultation, it was found that there is a great divide as to thoughts on current New Zealand trade policy and whether or not it should be shifted in regard to the values of sustainability and equal economic empowerment.
Lane then brought Ambassador of Ethiopia, H.E. Fitsum Arega, into the conversation. With the recent push towards a multilateral trading system and the African Continental Free Trade Agreement (ACFTA), Lane asked how this would tie into a future trade relationship between the United States and Ethiopia.
Ambassador Arega responded with increasing public investment of the Ethiopian government, both social and economic, strengthening the education sector and industrial infrastructure of the country. There is a growing preparation for global trade agreements and relationships in Ethiopia, and Arega identified Africa as the next frontier for business investment and trade because of these changes both domestically and continentally.
In addition to domestic reform, Ambassador Arega stated that the newly elected prime minister, Abiy Ahmed, has made Ethiopian involvement in the World Trade Organization and global trade has a priority in recent years. Arega also identified the vast potential for a United States trade partnership with Ethiopia, as it builds its infrastructure, it has also been building an environmentally sustainable textile market. The African Continental Free Trade Agreement is also a turning point for the continent, Arega explained, allowing for greater opportunities for processing and attractive investment.
Lane turned to H.E. Stavros Lambrinidis, Ambassador of the European Union, she asked whether or not the optimism for a US-EU trade agreement and future policies is warranted. Ambassador Lambrinidis responded that there is good reason to believe in the negotiations of future policy. He stated that when talking about the relationship between the United States and European Union, the benefits of this relationship could demonstrate that free trade can work in a globalized system and not in a way that would isolate certain countries.
Ambassador Lambrinidis identified the single European market as the biggest deregulation experiment in the world, allowing for an open market without borders of the most profitable businesses globally. The key focus of negotiations of a free market should be on the future, and special attention should be placed on the functions of said market from the grassroots of the economy to measure its effectiveness.
Lambrinidis also stated that the success of the single market is also reliant on the European progressive, values-based system; as trade is not only about making money, but about assigning values. GSP+ agreements establish that in order to negotiate and maintain a relationship, countries must also ensure human rights and sustainability practices.
Ambassador Lambrinidis then brought up the need for an established, rules-based system in the WTO and broader world order, as it is not only important to small countries, but also to large markets. Lambrinidis expressed great disdain for unilateral efforts to “destroy” the WTO, and while it is not easy to reverse protectionist and mercantilist policies and economies, he argued that the WTO must become stronger in the face of these issues and enforcing these changes.
With the changing world order comes new standards according to Lambrinidis, and no matter where countries are in their development, he believed there should be no exceptions to the implementation of these standards.
To further this point, Lane asked the panel to expand on their thoughts on the need to strengthen international systems and reforming the dispute settlement system of the WTO into this decade. Ambassador Rosemary Banks started the discussion, she stated that the first challenge of reforming multilateral organizations is having absolute commitment from major players of said organization.
Lane then moved on to special treatment for developing nations, especially as China, while a trade “powerhouse”, still receives exceptions from the WTO due to its first introduction as a developing country. Ambassador Lambrinidis identified this fact as a significant area of the WTO in need of reform as well as transparency and the Appellate Body.
He then stated that the WTO will always be in danger of collapsing as long as countries believe they are powerful enough to perform unilaterally and outside of its systems. He argued that without a neutral referee or party prosiding, dispute settlement will never work multilaterally, no matter how developed a rules-based system may be. China must play a bigger role in demanding rights but also in accepting obligations, and must be on board with future reforms.
H.E. Fitsum Arega, Ambassador of Ethiopia to the United States
H.E. Rosemary Banks, Ambassador of New Zealand to the United States
H.E. Stavros Lambrinidis, Ambassador of the European Union to the United States
H.E. Ashok Kumar Mirpuri, Ambassador of Singapore to the United States
Laura Lane, moderator, President, Global Public Affairs, UPS
To view more details about the event, visit the event page here.