WTO Current Affairs

IMF, World Bank and WTO launch Reinvigorating Trade and Inclusive Growth Report

International Monetary Fund (IMF), World Bank and World Trade Organization have collectively launched report “Reinvigorating Trade and Inclusive Growth”. In this report all three international organisations have sought liberalisation of global service sector, asserting that barriers to these services trade currently is roughly as high as those to trade in goods about a half century ago.

Key Highlights of Report

Services comprise some two-thirds of global GDP and employment. The limited opening of service sectors to foreign competition impedes trade and productivity growth throughout sector and broader economy.  Countries should open up to international competition in services provided in other ways, including through foreign direct investment (FDI) and operation of foreign affiliates and temporary movement of workers across borders for the purpose of supplying services.

The full services trade liberalisation can raise manufacturing productivity by average of 22% across sample of 57 countries with larger benefits for countries with stronger institutional environments. Moreover, service sector has enormous contributor to growth and to trade including manufacturing trade.

Improved access to services from trade reform promotes economy-wide productivity and income growth, and given sector’s size, role of services productivity in overall economic performance is evident. There is interplay between services reform and manufacturing performance

Services comprise significant shares of value added of all sectors in economy and this is reflected in trade figures also. Only quarter of global trade is traded as services, on value-added basis half of the value of global trade originates in service sectors.

The trade in services sector has potential of contributing particularly strongly to productivity growth and economic growth overall. Prolonged slowdown in pace of trade reform is leading to widespread trade distortions and putting at risk strength and durability of global economic recovery, despite recent rebound in trade.

Digital economy revolution is opening new opportunities for cross-border trade and investment and this is changing nature of trade, elevating roles of policies relating to electronic commerce, investment and services trade.

Month: Categories: Business & Economy Current Affairs 2018

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India notifies WTO of its decision to impose higher import tariffs on 30 US goods

India has notified World Trade Organisation (WTO) of its decision to impose higher import tariffs (ranging from 20 to 50%) on 30 goods from United States. It includes motorcycles (engine capacity of more than 800 cc), heavy machinery, certain iron and steel goods, boric acid as well as large number of agro products such as almonds, shrimps and chocolates. It is expected to rake in additional $240 million to India.

Key Facts

This will reportedly be the first time that India has imposed retaliatory import duties against US’s unilateral protectionist policies that range from tighter visa regime to higher import duties. The proposed increase in import duties is aimed at countering the impact of higher US tariffs on certain Indian steel and aluminium products, which is going to put burden on $241 million on India.

India imposed retaliatory import duties after it received cold shoulder from US on its request for exempting India from the higher tariffs announced by the US on steel and aluminium imports. India also had dragged US to WTO dispute settlement mechanism over the imposition of import duties on steel and aluminium. India’s exports of steel and aluminium products to US stood at about US $1.5 billion every year. Its exports to US in 2016-17 stood at US $42.21 billion, while imports were US $22.3 billion.

Month: Categories: Business & Economy Current Affairs 2018

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