trade

♦ The FT’s Neil Buckley interviews Mikhail Khodorkovsky, Russia’s most famous prisoner – a former oligarch who dared to cross Vladimir Putin.
♦ Trade has broken from a 30-year trend of growing at twice the speed of the global economy, pushing economists to wonder whether there has been a fundamental shift in world business.
♦ The Palestinians have called on countries to tell companies linked to Jewish settlements in the West Bank and East Jerusalem to withdraw immediately because the settlements violate international law.
♦ Mark Carney says the Bank of England is open for business and the days when the Old Lady preached the perils of “moral hazard” without due regard to financial pressures are well and truly over.
♦ The allegation by the German government that the NSA monitored Angela Merkel’s mobile phone has set off recriminations behind the scenes in the US.
♦ The NYT looks at the friction point between the Philiippines and China in the South China Sea, reporting from a ship at the dividing line.
♦ Formula 1 is considered entertainment, not a sport, by the Indian government, while chess is considered to be a sporting event.
♦ There is some disbelief over Al-Sisi mania.
♦ Tony Blair in the the Balkans to deliver some “deliverology”.
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♦ Martin Wolf argues that world trade remains vulnerable to problems such as financial crises and inequality: “As we learnt in the first half of the 20th century, liberal trade and investment cannot be an island isolated from events.”
♦ Alexei Navalny’s campaign to become Moscow mayor could be derailed by the five cases pending against him – the verdict of the first comes this week.
♦ Despite a surprisingly sharp fall in the deficit, political divisions in the US over longer-term budget policy are as wide as ever.
♦ The last of the Russian “Night Witches” has died – Nadezhda Popova flew 852 missions, chasing German invaders back to Berlin in the dark, with no parachutes, guns, radios or radar.
♦ Peter Hessler looks at the winners and losers in Egypt’s ongoing revolution.  Read more

Daniel Dombey

Gold bars are seen at the Czech Central Bank on September 05, 2011 in Prague (MICHAL CIZEK/AFP/Getty Images)

The golden stuff (AFP/Getty)

It must rank as one of the most thankless jobs in diplomacy. Just how do you draw up incentives for Iran to rein in its nuclear programme?

Talks have lumbered on, in one incarnation or another, for a decade now. Efforts to win over Tehran have been encumbered by mutual suspicion, political sensitivities (there is always the charge of appeasement) and sheer force of law.

Many of the sanctions the Islamic Republic most objects to are already on the statute book, whether as UN Resolutions, EU agreements or US law. No wonder it is difficult to come up with a compelling offer; few countries can change their laws by fiat.

On Monday, Tehran attacked one of the latest ideas seemingly floated by the world’s major powers – the notion the US could roll back recently imposed sanctions on gold sales to Iran.

The idea may have been designed to help Western allies – notably Turkey –as much as to alleviate Iran’s economic isolation. Last year Ankara became the world’s leading gold exporter to Iran, whether directly or through entrepôts such as the UAE. Demand from the Islamic Republic helped Turkey’s overall exports of the metal reach levels of $1.5bn-$2bn some months.

The trade has various explanations – chief of which is that bank transactions with Iran have become ever more problematic, particularly in the wake of measures affecting Swift, a group that facilitates electronic funds transfers. Against this backdrop, Tehran started taking payment for its oil and gas exports to Ankara in Turkish Lira – instead of via bank transfer – and using the money to buy gold it then ships home. Read more

Gideon Rachman

(LAURIE DIEFFEMBACQ/AFP/Getty Images)

Hold back the celebratory cupcakes (Getty)

As the FT reported this morning, the US has refused to give the Europeans the big, bold announcement on trade that they were desperately seeking.

The plan was that tomorrow’s US-EU summit would announce the beginning of negotiations to form a trade agreement between the US and Europe. But, for now, the Americans are refusing to play ball.

In Brussels, some may see this as a lamentable lack of vision. In fact, it is simply a welcome injection of some scepticism and realism. Read more

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John Paul Rathbone

Presidents Raul Castro of Cuba (L) and Sebastian Piñera of Chile during a summit of Latin American states on Monday (Reuters).

It all went surprisingly well. Latin America, in sentiment if not in deed, presented a united front to its European guests at the summit of EU and Latin American leaders in Santiago, which wound up on Monday. With customary politesse, local differences were mostly swept under the carpet.

Nobody in Chile kicked up a fuss that communist Cuba will now head the 33-member Community of Latin American and Caribbean states (Celac) – even though democracy is one of Celac’s core goals. The region’s free-trading Pacific countries –Mexico, Colombia, Peru and Chile – agreed to drop tariffs to speed the creation of their “Pacific Alliance”, a “free-trade” block. (By contrast, Mercosur, a rival regional trade pact led by more protectionist Brazil and Argentina has been negotiating an EU trade deal for over a decade.) A handful of business deals were signed. And a long and flowery letter, supposedly written by Hugo Chávez from his sickbed in Cuba and that called for Latin American unity, was read out, which lent some colour to the last day. Read more

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Alan Beattie

In the interests of fairness, having looked at how the Republican platform addresses trade and globalisation (fizzy rhetoric but not many hostages to fortune), here’s how the Democratic platform measures up.

In summary: it doesn’t say much, and it doesn’t say much new. The overall tone is boilerplate mercantilist with a soupcon of social concern:

We have taken steps to open new markets to American products, while ensuring that other countries play by the same rules. President Obama signed into law new trade agreements with South Korea, Colombia, and Panama … but not before he strengthened these agreements on behalf of American workers and businesses. We remain committed to finding more markets for American-made goods—including using the Trans-Pacific Partnership between the United States and eight countries in the Asia-Pacific, one of the most dynamic regions in the world—while ensuring that workers’ rights and environmental standards are upheld, and fighting against unfair trade practices.

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Alan Beattie

This is the kind of case that gets the WTO a bad name: confirming a ruling that the US acted illegally in requiring that beef and pork sold in America be marked with a country of origin label (hence the COOL acronym applauded by sub-editors worldwide). Predictably the WTO’s discontents are agin it.

But without getting into the technicalities of the case, which require more qualifications in food technology than I possess (ie >0) to explore fully, the principle behind the ruling is quite simple and quite fair. It’s whether the labelling has the effect of discriminating against foreign producers by being needlessly complex or otherwise unjustifiably difficult to comply. Read more

Alan Beattie

One of the very few bright spots in governments’ generally grim recent performance of managing the world economy has been that trade protectionism, rampant during the Great Depression, has been relatively absent.

That may no longer be the case. The WTO, fairly sanguine about the use of trade barriers over the past few years, warns today that things are getting worrying. The EU made a similar point yesterday. And this monitoring service has been pointing out for a long time that a lot of the new forms of protectionism aren’t counted under the traditional categories, thanks to gaping holes in international trade law. Read more