International roundup: Tariffs and trade pacts

International roundup: Tariffs and trade pacts

Global trade: Trump’s efforts to “get tough” on trade are ramping up

President Trump approved steep tariffs on imported washing machines and solar cells, following complaints from US manufacturers that countries like China and South Korea were unfairly subsidizing these industries in order to export their products at lower prices.

  • The tariffs, which are set to phase out in three to four years, will range between 15% and 50% depending on the products, with a substantial number of the imported washing machines facing 50% tariffs.
  • The tariffs will most likely result in higher prices and fewer purchasing options:
    • Korean manufacturer LG Electronics has already said it will raise prices on washing machines it sells in the US.
    • It is likely that domestic washer manufacturers like Whirlpool will raise their pricing, as well, to capture a significant portion of the tariffs levied on their international competitors.
  • Both China and South Korea reacted negatively to the news and both countries indicated they might appeal to the World Trade Organization, the group responsible for resolving international trade disputes.
Quick editorial:

As tensions rise and the specter of nuclear war hangs over the Korean Peninsula, now is not the time to anger our ally South Korea with tariffs nor to initiate a trade war with China, who has finally been in earnest about enforcing UN sanctions against North Korea.

Trump is also attempting to renegotiate the free trade agreement – which he previously called “horrible” – that’s been in effect between the US and South Korea.

  • The deal, in effect for the last six years, has seen trade between the two countries rise to almost $150 billion.
  • After an initial increase, the US trade deficit with South Korea is now declining, a positive step for the US in balancing trade.

Boeing unexpectedly lost a landmark trade case in the US to its Canadian aerospace competitor Bombardier, overturning large 292% tariffs imposed by the Trump administration on imports of the latter’s C-Series planes.

  • Originally, Delta Airlines had planned to buy 75 of Bombardier’s C-Series aircraft but Boeing cried foul to the US Commerce Department, believing the planes were being sold to Delta at unfairly low prices enabled by Canadian and British subsidies to the company and its suppliers.
  • The Commerce Department recommended an import tariff of 292% on each C-Series plane sold in America.
  • Boeing also brought its case to the US-backed International Trade Commission, which was widely believed to rule in favor of Boeing. However, the Commission voted unanimously to overturn the punitive tariffs, ruling in favor of Bombardier.

Canada has announced that it has agreed to a revised Trans-Pacific Partnership (TPP) trade agreement between itself and 11 other countries (including Australia, Japan, Mexico and Vietnam), following the withdrawal of the US from the agreement last year. The agreement is set to be signed in March.

  • Canada’s primary trading partner is the US, which accounts for 75% of Canada’s trade. With clouds of uncertainty hanging over the status of the North American Free Trade Association (NAFTA), and the confusion over what exactly Trump wants to change in NAFTA, this move will allow Canada to decrease its reliance on the US for trade.

Africa: Weah ushers in a new era in Liberia

Former professional soccer player George Weah was sworn in as Liberia’s new president last week. Weah’s election is the first peaceful power transition in the country in 47 years. Weah, considered to be one of the greatest footballers of all time and winner of the 1995 FIFA World Player of the Year Award, will be the 25th president of the African country and has vowed to tackle poverty and corruption.

Elsewhere in Africa:

Last Tuesday, a car bombing in the Libyan city of Benghazi killed more than 30 people.

  • The attackers deployed two car bombs: the first exploded “outside a mosque in Benghazi’s central Al Salmani district as worshippers were leaving evening prayers,” and the second exploded on the other side of the street 10 to 15 minutes later, after first responders had arrived on the scene.
  • No group has claimed responsibility for the attack.

U.S. troops worked alongside Somali security forces to rescue 30 child soldiers conscripted to fight for the al-Shabaab militant/terrorist group during a raid on one of the group’s camps. Al-Shabaab has direct links with al Qaeda.


Asia: In the name of national security, US military looks the other way on child sexual abuse in Afghanistan

A recently published report by the Special Inspector General for Afghanistan Reconstruction (SIGAR) highlights a disturbing practice of the US Department of Defense: ignoring and enabling the sexual abuse of young children by US-backed Afghan security forces, in the name of “national security.”

  • The Leahy Law, passed by Congress in 1997, is meant to prevent this sort of thing from happening by barring the military from “providing funds, training or other aid to foreign military units that are involved in serious human rights abuses.” However, the military gets around this law by using a loophole, “the notwithstanding clause,” which allows them to ignore the Leahy Law for national security purposes.
  • SIGAR was commissioned by Congress to investigate high levels of sexual abuse among Afghan security forces. The report recommends closing “the notwithstanding clause” loophole in the Leahy Law, which the Department of Defense opposes.
  • Per the report: “The full extent of child sexual assault committed by Afghan security forces may never be known.”

The sexual abuse of young boys, or bacha bazi (which literally translates to “playing with boys”), is an ancient custom in Afghanistan in which young boys are dressed up like women and dance for men. Even more disturbing is the sexual abuse that often happens after these performances. Bacha bazi, like opium production, was banned by the Taliban when they controlled the country, but the practice resurfaced after the US invasion of the country. US soldiers have been told to ignore the sexual abuse they encounter. The report found that two-thirds of those interviewed by SIGAR were aware of bacha bazi and other abuse issues.

Elsewhere in Asia:

At least 103 people were killed in a car bombing in Kabul, Afghanistan on Saturday. The attack, which also wounded at least 235 people, was carried out by the Taliban using an ambulance packed with explosives.

  • This attack follows last week’s attack by the Taliban on an upscale hotel in the city, which killed at least 22.

Mohamed Nasheed, the exiled ex-president of the Maldives, has accused China of colonialism and land-grabbing over its leasing of at least 16 islets in the Maldives. China is building ports and other infrastructure over the islets.

  • Nasheed has called on others in the region to counter Chinese expansion.
  • Ostensibly, the Maldives play a key role in China’s “One Belt One Road” initiative to improve infrastructure and improve the trade networks between China and other Eurasian countries. However, the build-up of ports and other maritime facilities in the Maldives (and other locations like Pakistan and Sri Lanka) also play another role in China’s “String of Pearls” geopolitical strategy: to contain India’s expansion and reduce its influence in the Indian Ocean while increasing Chinese influence. 

A US congressional report released on Wednesday finds that large amounts of the opioid fentanyl are being imported from China into the US via the US postal service.

  • The drug, manufactured in labs in China, is sold to US buyers over the internet, then shipped through USPS.
  • More than 64,000 people died from drug overdoses in 2016, including 20,000 from fentanyl and other synthetic opioids.
  • Fentanyl, which can be thousands of times stronger than morphine, is often used to cut other drugs.

China’s ambassador to Washington indicated last week that China would accept a reunified Korea, even if it was aligned with the West, as long as it is achieved peacefully and independently by the Korean people.

  • North Korean leader Kim Jong Un also indicated his desire for reuniting the Korean peninsula last week, announcing that all Koreans should work together to defuse military tensions and create peaceful conditions on the peninsula to open the way to reunification.
  • The announcement also pointed to joint military drills between the US and South Korea on the Korean Peninsula as a “fundamental obstacle.”
Quick analysis:

You shouldn’t read too much into this. Reunification has been brought up before, and North Korea’s call is likely part of a strategy to drive a wedge between South Korea and the US, or at least pause the joint military drills. And because it’s highly unlikely Kim Jong un would accept a unified Korea in which he’s not in control, a call for reunification really is a kind of veiled threat.

China’s top media regulator, the State Administration of Press, Publication, Radio, Film and Television of the People’s Republic of China (SAPPRFT) has decided to ban hip-hop and other sub-cultures it considers to be subversive, including a request that Chinese programs do not feature actors with tattoos.


In and around the Middle East: A tale of two leaders

Egyptian presidential candidate Sami Anan, a retired general, was arrested last week and is being held in a military prison, leaving current president Abdel Fattah el-Sisi as the only serious remaining candidate in the election. Anan was removed for violating Egypt’s military code, forging documents, and running for president without the military’s permission. The other candidates were removed or coerced to withdraw for a variety of reasons, including charges of corruption and threats of violence (including former Prime Minister Ahmed Shafiq, at one point the main contender, whose family claims he was kidnapped for 24 hours to intimidate him into withdrawing). El-Sisi was elected president in 2014 after leading a military coup against former President Mohammed Morsi.

Speaking of iron-fisted leaders, Iran’s Supreme Leader Ayatollah Ali Khamenei has ordered the Revolutionary Guard to loosen its hold on the economy, according to Iran’s Defense Minister, General Amir Hatami. If Hatami is indeed speaking for Khamenei – and the Supreme Leader’s office has not confirmed the order – then it “rais[es] the possibility that the paramilitary organization might privatize some of its vast holdings,” as the Associated Press observes.

  • The Revolutionary Guard operates a parallel power structure to the military in Iran where, in addition to their significant military and intelligence forces, they control large sectors of the economy (estimated to be between 20 and 40 percent of the total economy).
  • Poor economic conditions in Iran are believed to be one of the primary causes of last month’s protests, and this announcement, if it did indeed come from Khamenei, appears to be geared towards revitalizing the economy.
  • The Guard, whose economic holdings include construction companies as well as firms that build roads, staff ports, and run telecommunications networks, has not commented on the announcement.

Elsewhere in and around the Middle East:

Saudi Arabian Prince Alwaleed bin Talal, one of the most prominent figures jailed in Crown Prince Mohammed bin Salman’s “corruption crackdown” back in November, has been released from custody after reaching a financial settlement with the Saudi government.

  • Prince Alwaleed will continue to head the influential Kingdom Holding Company, which he founded.
  • Other princes and officials were also released, bringing the total number of those released to about 90 people. Another 95 people are still being held.
  • The Saudi government hopes to recover over $100 billion in settlements from those arrested.

President Donald Trump has continued to threaten to cut off US aid for Palestinians over their refusal to take part in any US-brokered peace talks, accusing the Palestinians of “disrespecting” the US.

  • Following the president’s decision to move the US embassy from Tel-Aviv to Jerusalem, recognizing the latter as the capital of Israel, Palestinian leaders said they would no longer accept the US as a neutral broker in peace talks.
  • Vice President Mike Pence confirmed that the embassy will be moved to Jerusalem by the end of 2019 in a speech to Israel’s parliament on Monday.
  • Trump’s comments follow a decision earlier this month to withhold $65 million from the UN agency that supports Palestinian refugees.
  • The US gave the Palestinians approximately $260 million in 2016, compared to the more than $3 billion per year in military aid given to Israel.

North America: Canada will use its G7 presidency to push for ocean protections

Canada, which currently presides over the G7 group of nations, announced plans to work with the other G7 countries on protecting the world’s oceans from the build-up of disposable plastic products, which is already proving to be a deadly scourge on marine life.

  • Canada’s Environmental Minister Catherine McKenna said such action could take the form of “a plastics charter to a zero waste goal.”
  • The G7 or Group of Seven, is a group made up of the 7 countries with the largest advanced economies in the world: Canada, France, Germany, Italy, Japan, the United Kingdom, and United States. The group meets several times a year to discuss economic policies and work together toward certain common goals.

The US embassy in Haiti was closed last Monday following demonstrations by more than 1,000 Haitians protesting President Trump’s vulgar comments comparing Haiti to a “shithole.”


South and Central America: Lula’s comeback in Brazil gets a little more complicated

One of the frontrunners in Brazil’s upcoming presidential election had his corruption conviction upheld by a Brazilian appeals court last week.

  • Luiz Inácio Lula da Silva (Lula), former president of Brazil from 2003 to 2011, received a major blow to his presidential bid when all three judges of the appeals court agreed to uphold the corruption conviction.
  • From the Washington Post: “Linked to a massive corruption probe known as ‘Operation Car Wash,’ Lula was convicted of receiving bribes worth more than $1 million, mostly in the form of a refurbished beachfront apartment.”
  • He has not confirmed whether he intends to appeal his conviction to the Brazilian Supreme Court, but it would be surprising if he does not.

Elsewhere in South and Central America:

A shooting at a nightclub in the Brazilian city of Fortaleza left at least 14 people dead, including two minors. The shooting, reported by local media to have been carried out by a criminal gang, appears to be connected to drug trafficking in the city. 

Venezuela’s Supreme Court has ruled that the main opposition parties to President Nicolas Maduro will not be allowed to register to run in the upcoming presidential election.

  • The ruling, along with Maduro’s decision to hold the election early, “is fueling accusations of election rigging even before people head to the polls.”
  • The US has already said it will not recognize the election.

Mexico’s National Human Rights Commission announced that three US citizens (all siblings) found killed in 2014 on their way from Mexico to their mother’s home in Texas were executed by Mexican marines and a paramilitary security team.

  • No reason has been given for the killings, nor is there any current investigation to find those responsible, although they’re almost certainly related to the ongoing drug war in Mexico, which saw a record 29,168 murders in 2017.

Bonus round:

President Trump has refused to visit the United Kingdom unless British Prime Minister Theresa May bans the anti-Trump protests that would likelier than not take place. Trump also complained about the negative coverage he has received by the press in the UK. For her part, May informed the president that there was little she could do about the media coverage or his request to crack down on dissent.

  • Trump has had a rocky relationship with the UK since he became president, highlighted by incidents such as retweeting anti-Muslim posts from a British far right group – which he just recently said he was willing to apologize for (without actually apologizing for it) – and attacking Sadiq Khan, the Mayor of London, over his handling of a terror attack.

 

Citizens of the United Kingdom, Canada, Australia and New Zealand could eventually find themselves able to move freely between each other’s countries. While the creation of such an agreement still has many hurdles to overcome, it should be noted the latter two countries already have an agreement allowing free movement and trade between them.


 

Geologists working in Northern Australia have found Canadian bedrock, indicating that Australia, or at least the northeastern portion of Australia, may have been part of a supercontinent, called Nuna or Columbia, that included North America. The rocks, which match the rocks found in the Canadian Shield, are believed to be 1.7 billion years old, about the same age as the theoretical supercontinent. Australia has not indicated whether they will return the Canadian bedrock portion of the country to Canada.


 

A German nurse has been charged with killing 97 patients over a several-year period. The nurse, Niels Hoegel, is already serving a life sentence for two other murders.

  • On a lighter note, a prominent member of the German far-right Alternative for Germany (AfD) Party has announced his conversion to Islam. Arthur Wagner, a leading AfD member and member of the party’s national executive committee, resigned from the party, most likely due to the anti-Islam and anti-migration stance of the AfD. The AfD currently holds 92 of the 709 total seats in the Bundestag, Germany’s parliament, following the 2017 federal elections.

header image: "container ship," kevin burkett / flickr

Happy birthday to the runoff!

Happy birthday to the runoff!

Trump jumps into immigration negotiation after the government shutdown ends.

Trump jumps into immigration negotiation after the government shutdown ends.

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