Jim Rollo

The political economy of Eastern European trade with the European Community: why so sensitive?

EC trade with Eastern Europe Jim Rollo and Alasdair Smith Despite agreements to open trade with Eastern Europe, the European Community has retained a substantial degree of protection against imports of ‘sensitive’ products, notably agricultural products, textiles and clothing, and steel. This article investigates how sensitive these products really are. It is true that the targeted products are important to the EC economy, particularly in the poorer or declining regions. Yet trade with Eastern Europe only amounts to a very small proportion of the size of these sectors. When a large increase in imports is simulated, the overall effects on the Community are not insignificant, but are well within the range of the normal experience of economic change. Even without taking into account the fact that Eastern markets for EC goods would also grow, trade liberalization is welfare-increasing, particularly far Eastern Europe. Thus ‘contingent protection’, which may seriously deter investment in Eastern Europe, may simply be protectionism in any sector in which Eastern Europe is successful.

Emerging Trends in WTO Dispute Settlement: Back to the GATT?

As the number of cases in the World Trade Organization (WTO) dispute settlement system has increased, there has been a greater effort by the academic community to analyze the data for emerging trends. Holmes Rollo, and Young seek to develop this literature using data up to the end of 2002 to ask whether recent trends confirm previously identified patterns and to examine whether there are divergences from the overall pattern according to the type of dispute. They focus on three questions in particular: What explains which countries are most involved in complaints under the dispute settlement understanding? Is there a discernible pattern to which countries win? Is there a difference to these patterns depending on the type of measure at the heart of the complaint? The authors find that: A countrys trade share is a pretty robust indicator of its likelihood to be either a complainant or a respondent. The frequently remarked absence of the least developed countries from the dispute settlement system can be explained by their low volume of trade. There is not much, if any, evidence of a bias against developing countries either as complainants or respondents. Regulatory issues are fading as reasons for disputes and trade defense disputes are the rising issue. Complainants overwhelmingly win (88 percent of cases). There is no strong evidence that the rate of completion of cases is biased against newly industrializing countries or traditional less developed countries.

Border carbon adjustments and the potential for protectionism

Balancing a legitimate fear that carbon leakage could undermine the impact of any global climate change agreement is a countervailing fear that leakage could be the excuse for protectionism in the guise of ‘border carbon adjustments’. This would be dangerous for the world trading system, risking disputes due to ambiguities in the details of World Trade Organization rules over what types of border measures are potentially and actually admissible. Even with good-quality data, there is considerable potential for judgemental discretion, and hence opportunistic manipulation, in estimating the carbon charges to levy on an imported product. This is true even given agreement on whether to use importer or exporter coefficients. A clear distinction needs to be made between environmental and competitiveness motives for border adjustments. The key argument is that the traditional symmetry, between origin (production)-based taxes and other charges (e.g. due to a cap-and-trade scheme) and those based on the destination (consumption) principle, breaks down in the case of carbon charges. The potential is explored for regional agreements to ensure origin as the basis for carbon levies, while recognizing the challenges this poses for the mutual recognition of emissions regimes in particular.

In or Out: The Choice for Britain

The choice facing British government about maintaining the status quo for sterling or joining the euro is a choice between long-term policy regimes. Short-term considerations such as the relative position of business cycles or the current level of the sterling-euro exchange rate have a bearing on the adjustment costs and the timing of entry. The article therefore examines the EMU framework versus the British framework for monetary policy; the performance of economic policy in Britain and in Euroland, and especially Germany as Eurolands main precursor; the relevance to the adjustment costs of membership to the Maastricht criteria and the Chancellor of the Exchequers five economic tests for joining the euro; and whether or not Britain can qualify for joining EMU. The analysis is broadened to include supporting policies for monetary policy, especially fiscal, labour market and other structural policies where relevant.

Negotiating the UK's Post-Brexit Trade Arrangements

This paper considers the agenda for UK trade negotiations over the post-Brexit period. There are several groups of countries that will need to be dealt with and we consider the priorities among them. Negotiations with the WTO and the EU are the most important and the most pressing in time, and should be pursued simultaneously. On the former, the UK must try quickly to establish its independent WTO status, which will be greatly facilitated by minimising the changes it proposes to its tariffs schedules. On the EU the UK needs to consider the choices between remaining in the customs union, creating an FTA with the EU and maintaining the ‘regulatory union’ that is the European Economic Area (EEA). Only when relations with the EU and WTO are clear will it be feasible to negotiate trade deals of various sorts with other countries, ranging from those with which we already have deals via the EU to those that currently trade with us on ‘WTO rules’. All of this takes time and we argue that it may be worth pursuing transitional arrangements to extend certain current trading arrangements a few years beyond Brexit in order to make time for serious negotiations.

Multilateralizing Regionalism: The challenge of negotiating RTAs for developing countries. What could the WTO do to help?

This paper examines the challenges that confront negotiators of Regional Trading Arrangements because of the second best nature of the arrangements. It shows that human resource constrained administrations in developing countries are likely to be at a particular disadvantage in carrying out the necessary assessments of the costs and benefits of specific proposals for RTA. It then considers the Sussex Framework for assessing RTA as a specific example of a relatively low cost but robust approach to analysing RTA without recourse to sophisticated modelling. The paper then suggests that for reasons of international negative spillovers from RTA and asymmetric information there is a case for public provision of such analytical frameworks free or at low cost to developing countries. The WTO could in principle provide the analytical, training and advisory services but is unlikely to do so for political reasons. The paper concludes by proposing a new international organisation, the Advisory Centre on RTA, closely modelled on the Advisory Centre on WTO Law set up to help developing countries involved in trade disputes