Uncompromising (or) Trade-offs?

Dear Readers,

Over the last three decades, free trade has advanced due to a favorable international order and the availability of relatively cheap means of transport enabling fast delivery of products to customers. These have been the main boosters of globalization, together with the technological revolution. With the advancement of 3-D printing, for example, new ways of decentralized production over the long-distance have become economically and technically feasible with far-reaching implications for labor markets. Business models of production, logistics, distribution and marketing have changed dramatically based on global supply chains. Newly emerging business models require smarter protection of intellectual property. The importance of approximation of regulation – be it technical, environmental or other standards – cannot be overestimated. Until recently, trade negotiators spent most of their time harmonizing regulations in efforts to curb non-tariff barriers. To no one’s surprise, these were the main stumbling blocks in TTIP negotiations. This is no longer the case. The U.S. President has re-installed custom tariffs into the policy toolbox. Ken Weinstein of Hudson Institute explains the broader context of the U.S. – China tariff battle. It has implications for the global economy since the triangle between the U.S., China (PRC) and the EU accounts for a major chunk of global trade. In 2016, the trade volume between US and EU accounted for 685 (all in billion USD), between the U.S. and China – 552, and between the EU and China – 560. U.S. import from China – 426 – has exceeded import from the EU – 410, while the trade deficit of the U.S. with China – 300 – was more than twice that of the EU -135.

This issue also contains contributions dealing with movement of people, including labor migration. An interview with historian Miroslava Keryk deals with the role of Ukrainian workers in the Polish economy. In another interview, Michael W. Doyle of Global Policy Initiative at Columbia University speaks about the draft of the International Mobility Convention designed to treat various modalities of human mobility in a more comprehensive manner and in a legally binding way. This could serve as inspirational reading for those criticizing the UN Global Migration Compact.

Former EU Commissioner Lewandowski deals with possible trade-offs in the negotiations of the 2020-2027 EU Multi-annual Financial Framework. Should the EU budget focus on research and innovation or spend more on defense or regional and agricultural subsidies? What is more conducive to the future success of Central Europe? We have identified investments in human skills and education as key factors of economic competitiveness at our annual conference about the “Shape of (Central) Europe”. The proceedings from the recent one can be found on our website and will be returned to in future issues. Stay tuned to us!