extra slides for - the university of adelaide blogs...2017/03/06 · #2) factories crossing borders...
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Extra slides for:
© Richard Baldwin 2016
Rapid industrialisers vs commodity exporters
Sector origin of value-added in export growth
0% 25% 50% 75% 100%
Australia
India
Brazil
Russia
Indonesia
Mexico
Poland
Turkey
Korea
China
Manufactures Services Primary
0% 25% 50% 75% 100%
Canada
UK
US
France
Germany
Italy
Japan
Manufactures Services Primary
How it explainstoday’s anti-globalisation in many rich nations
© Richard Baldwin 2016
KEY CHANGES
#1) New Globalisation breaks monopoly that G7 labour had on G7 knowhow
© Richard Baldwin 2016
KEY CHANGES
#2) New Globalisation affects economies with finer resolution; It’s not sectors & skill groups anymore
© Richard Baldwin 2016
• #1 & #2 mean New Globalisation’s impact is:– More sudden;– More individual;– More unpredictable;– More uncontrollable.
KEY CHANGES
Result in most G7 nations: Economic anxiety, fragility & disenfranchisement
No matter what job or skills you have, you can’t really be sure your job won’t be next.
© Richard Baldwin 2016
What does the New Globalisation mean for global trade governance?
© Richard Baldwin 2016
TRADE CHANGED
#1) Trade changed when within-factory flows became international commerce
© Richard Baldwin 2016
#2) Factories crossing borders means more complex, more entangled international flows
• These new flows of goods, services, investment, capital, people, knowhow and intellectual property are a package‐deal.
• Internationalised factories require all of the flows to work well.
© Richard Baldwin 2016
#3) The new, complex, entangled international commerce needs new disciplines
• G7 firms seek new assurances; Factory Economies seek to provide them.
• New political economy arose– “Northern factories in
exchange for Southern reform”;
– Not: “Access to my market in exchange for access to yours”.
© Richard Baldwin 2016
WTO ignored the need for new disciplines
WTO TALK STUCK FOR 14 YEARS ON 20TH CENTURY ISSUES
Most WTO members were left behind by New Globalisation
© Richard Baldwin 2016
• New packages of disciplines arose in Regional Trade Agreements between rich and poor nations – North‐South RTAs.
• Many developing nations embrace the new disciplines unilaterally.– Pro‐Biz reform.
With WTO deadlocked, 21st century policy went elsewhere
Number North‐South
of RTAs
Number of ‘deep’
disciplines in North‐South
RTAs
0
20
40
60
80
100
120
1971
1976
1981
1986
1991
1996
2001
2006
2011
© Richard Baldwin 2016
LOOKING AHEAD
Major mega-regional deals recently; Future is very uncertain
© Richard Baldwin 2016
• TPP & TTIP are dead– Trust in US trade leadership undermined for many years?
• China likely to fill part of the vacuum – especially in Asia.
• EU‐Japan‐Canada may emerge as a new leadership group.