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NHK
15 hours ago
- Business
- NHK
Von der Leyen floats idea of EU-Asia trade cooperation
European Commission President Ursula von der Leyen has floated the idea of cooperating with Asia to promote rules-based free trade. She says it could serve as the basis for redesigning the World Trade Organization. Von der Leyen spoke on Thursday after a European Union summit. She referred to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, or CPTPP, describing the key trade pact as "most attractive and interesting." She also said Asian nations want structured cooperation with the EU, and the EU "wants the same." US President Donald Trump's "America First" policy and sweeping tariffs have put the global economy at a crossroads. Von der Leyen's comments suggest the EU may be seeking to lead a free-trade system that does not include the United States. But one EU source says she is more likely posturing as a way to gain leverage over the Trump administration.
Daily Maverick
18 hours ago
- Business
- Daily Maverick
WTO fisheries agreement gains momentum, but will Africa's coastal states rise to the challenge?
Despite the high cost of illegal fishing, only a third of African countries have signed the landmark agreement that will soon take effect. The World Trade Organization (WTO) Agreement on Fisheries Subsidies is on track to be adopted this year, with Ghana the latest African country to ratify. Nine more ratifications are needed to reach the total of 111, which activates the treaty. The landmark deal will come into force in what looks like a ' super year ' for ocean governance. Yet only about a third of African states have ratified it, raising questions about whether the agreement risks faltering where the benefits are most needed. The Food and Agriculture Organization's most recent State of World Fisheries and Aquaculture report says Africa's fisheries are among the most vulnerable and highly affected by overfishing and illicit, unreported and unregulated fishing. Little of Africa's marine fish stocks are caught sustainably. This presents the continent with a unique trifecta of challenges: subsidised foreign fleets, weak ocean governance, and climate change combine to undermine the sustainability of marine resources. Small pelagic stocks in West Africa have collapsed, East African coral reef fisheries run below sustainable yields, and coastal livelihoods and food security are under threat. Current estimations suggest that at least $11.2-billion in African revenue is lost annually due to illegal exploitation. In this context, the fisheries deal should be a major step in addressing unlawful fishing and harmful subsidies that contribute to overfishing. Globally, 102 countries are officially recorded as having ratified the agreement. Several others, including Ghana, have completed domestic ratification, but aren't yet reflected in the official count because they still need to conclude the formal procedure. The agreement targets three areas contributing to the depletion of marine resources, with two implementation phases. First, it bans subsidies linked to exploiting overfished stocks, aiming to bolster conservation and awareness about weak regulatory oversight. Second, it prohibits fishing subsidies in high seas areas beyond the purview of regional fisheries bodies, where enforcement gaps are common and migratory fish stocks are vulnerable. Finally, it bans subsidies to vessels involved in illegal fishing. These measures respond to longstanding concerns about the role of subsidies in enabling overfishing and illegal fishing, especially by distant-water fleets. Although the benefits for Africa are clear, the reception seems lukewarm, with just 20 African countries having officially ratified the agreement. Most support has come from West Africa, where the Economic Community of West African States has urged its members to support the initiative. In East and southern Africa, only four coastal states have ratified: Comoros, Mauritius, Seychelles and South Africa. One probable reason is limited awareness and technical capacity since the agreement is essentially a trade instrument, not a conventional fisheries or environmental treaty. So understanding the deal's implications requires coordination between national agencies responsible for fishing, environment, trade and foreign affairs. The agreement is nevertheless on track to enter into force before year-end, underscoring the importance of Africa's readiness to successfully implement it. For one thing, implementation will likely come with financial and resource implications. The agreement requires all WTO members to create a national subsidy inventory documenting the nature, recipients and purpose of fisheries subsidies. This will require inter-agency coordination, political commitment, and new digital reporting systems, potentially adding costs for African states. At the same time, a lack of capacity or political will to implement may see countries become targets for illegal fleets, since the agreement is only as strong as states' ability to enforce it. This is especially likely since the prohibition is not triggered automatically, but only once a relevant party determines a transgression has occurred. That party could be the coastal state against which a transgression has been committed, one whose flag is used by the vessel involved in illegal fishing, or a relevant regional fisheries management organisation/arrangement. However, the arrangements are not always well equipped to deal with illegal fishing, and their ability to respond depends on member states' commitment and capacity. And flag states, especially those providing flags of convenience, are seldom willing to enforce rules that undermine their profits. This means the successful use of the agreement will depend on countries' ability to detect illegal activity and collect evidence. That doesn't diminish the initiative's utility, but highlights the challenges African countries could face as they prepare for implementation. To maximise the agreement's benefits, governments should prioritise three actions. Self-assessment tool First, they must use the WTO's self-assessment tool to systematically align national policies with the agreement's requirements. Identifying legislative, regulatory and institutional gaps may require technical assistance or capacity-building support. Second, states should strengthen coordination among fisheries, trade and finance ministries to ensure coherent policy implementation and transparent reporting on subsidies and conservation measures, as mandated by the agreement. Third, African countries are well positioned to leverage the WTO Fisheries Funding Mechanism, which provides resources for developing nations to upgrade fisheries management, enhance compliance and help small-scale fishers achieve sustainable practices. This support becomes available to member states on ratifying the agreement. However, the deal alone is not a panacea. It is a useful addition to countries' toolkit in their fight against illegal and unsustainable fishing — but its effectiveness will depend on the actions of African coastal and flag states. Countries should use existing maritime mechanisms, such as the Djibouti and Yaoundé codes of conduct, as well as their regional maritime security strategies. The African Union (AU) and the AU Development Agency could provide technical support and capacity building, and raise awareness among member states as they have done before. The absence of a robust WTO enforcement mechanism means African countries must simultaneously invest in strengthening their maritime security and implementing international accords like the Agreement on Port State Measures. Enhanced surveillance, port inspections and regional collaboration are vital for intercepting illegal catches and deterring illicit operators. Without these complementary measures, the risks to Africa's food security, economic stability and regional security will persist. DM
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Business Standard
19 hours ago
- Business
- Business Standard
As US credibility falters, Asia and Europe must lead global stability
Given that everyone will suffer from these shocks, cooperation to ameliorate them should be a priority, especially for Asia and Europe Shang-Jin Wei Countries around the world are confronting the same confluence of shocks. The continued breakdown of the global trading system, owing to a volatile US tariff policy, is now accompanied by the risk of disruptions to trade routes and oil production from military conflicts in West Asia. Moreover, concerns about the safety of dollar-denominated assets are growing, because United States President Donald Trump's 'big, beautiful' spending Bill is expected to erode America's already-weak fiscal position. At the same time, the broad, geopolitically induced reshuffling of global supply chains continues, and the risk of climate and environmental breakdown has increased, especially now that the United States has withdrawn from the Paris climate agreement again. Given that everyone will suffer from these shocks, cooperation to ameliorate them should be a priority, especially for Asia and Europe. Both regions are heavily integrated into the global trading system, and both could be affected by the loss of US fiscal credibility. Many Asian countries' foreign-exchange reserves are heavily weighted towards dollar assets, and most of their external trade is invoiced in dollars. Similarly, climate change poses a major threat to all countries, but Europe, especially, has staked its future on the clean-energy transition. Simply put, the recent shocks threaten the foundation on which Asian and European countries have built their economic models: Open trade, which itself is based on a rules-based system. The US has gone from being a rule-setter to becoming a rule-breaker. For example, Mr Trump's misleadingly labelled 'reciprocal tariffs' explicitly violate the most-favoured-nation (MFN) principle, which prohibits any World Trade Organization member from maintaining different trade barriers for different countries except under a formal free-trade agreement. Mr Trump has also violated the US commitment not to raise its tariff rates beyond WTO 'bound rates' — another cornerstone of the global system. Similarly, the US is undermining the dollar-centric system that Asian and European countries have long relied on for liquidity, trade financing, and financial risk management. The expected erosion of the US fiscal position, combined with Mr Trump's capricious tariff policy, has cast doubt on the dollar's reliability. According to the non-partisan Congressional Budget Office, the budget Bill that Mr Trump wants Congress to pass will add an estimated $2.4 trillion to the $36 trillion of existing US debt (some 100 per cent of US gross domestic product in 2024). And with congressional Republicans poised to raise the debt limit by another $5 trillion, US federal government debt could reach 134 per cent of GDP by the time Mr Trump leaves office. Ernest Hemingway famously wrote that bankruptcy happens 'gradually and then suddenly.' Because the US has never technically defaulted, the recent rise in risk premia on government bonds can be said to fall within the 'gradually' phase. But investors must now consider the possibility of 'suddenly' coming sooner than previously thought. Rather than looking for separate hedging strategies, Asia and Europe would benefit more from collaboration. On the trade front, an enhanced framework between the European Union and the two big Asian trading blocs, the Regional Comprehensive Economic Partnership and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, would establish trading rules for almost the whole world — regardless of what the US does. The key to a successful framework would be to keep all the WTO rules that have proven effective in driving trade and prosperity for the past seven decades, including the MFN principle. But Asian and European leaders should also seek to improve upon the WTO rules that are deficient, including those governing subsidies and the conduct of state-owned firms. They also would need to resuscitate the WTO dispute-settlement mechanism, perhaps tripling the number of Appellate Body judges. On the climate front, the danger now is that other countries (such as Argentina) may follow the US in exiting the Paris agreement. To head off that possibility, Asia and Europe should pursue a common carbon-tariff framework. If the world's two largest trading regions impose the same penalties on carbon-intensive imports, they will create a powerful incentive to stay the course on decarbonisation. On international finance, the two regions can work towards a system that is more resilient to irresponsible behaviour on the part of any single country. The goal is not to displace the US dollar as the dominant global currency, but to offer more instruments for risk management. For example, a new stablecoin could be pegged to the euro or one of the major Asian currencies. Central banks could form a network of currency-swap agreements that are independent of the US dollar. And countries could work towards a more robust multilateral debt-relief framework for low-income countries, building on cooperation among the European Investment Bank, the Asian Development Bank, the Asian Infrastructure Investment Bank, the African Development Bank, and the Paris Club of sovereign creditors. None of these solutions will be easy to achieve, of course, given the tensions between countries within each regional bloc regarding a variety of issues. Cooperation would require compartmentalisation, with governments focusing squarely on providing global public goods. As challenging as this might seem, the alternative will be far costlier to Asia and Europe — and to the rest of the world. The author is professor of finance and economics at Columbia Business School and Columbia University's School of International and Public Affairs ©Project Syndicate, 2025
The Mainichi
21 hours ago
- Business
- The Mainichi
U.S. tariff rate hits historic level of 25.9%: Japan trade report
TOKYO (Kyodo) -- The effective U.S. tariff rate on all imports rose to as high as 25.9 percent under President Donald Trump, surpassing levels not seen since the protectionist policies of the Great Depression, the Japanese government's annual trade report showed Friday. The U.S. tariff measures as of early April, including an increase in the levies on China to 145 percent, reached a "historic scale," the Japanese trade ministry said, adding that frequent changes in Trump's trade policy are creating "heightened uncertainty." According to the ministry, the effective tariff rate -- the actual rate applied to imports -- was 19.8 percent in 1933, after the United States enacted the Smoot-Hawley Tariff Act in 1930 to protect American businesses and farmers from foreign competition by significantly raising tariffs on imported goods. The report by the Japanese Ministry of Economy, Trade and Industry cited data from the International Monetary Fund as a reference. The April rate also reflected new tariffs on the auto sector. The U.S. effective tariff rate has since declined after Washington and Beijing agreed in May to roll back a significant portion of each other's steep tariffs, marking a de-escalation of their tit-for-tat trade war. Japan's simple average tariff rate stood at 3.7 percent in 2023, according to data from the World Trade Organization.
Business Times
a day ago
- Business
- Business Times
Japan private-sector rice imports soar in May
[TOKYO] Japan's private-sector rice imports rocketed higher in May as the country grapples with supply shortages that have become a major headache for both consumers and policymakers. Some 10,600 metric tons of so-called staple rice – which is consumed at meals as opposed to rice used for feed or ingredients in other products – were imported by companies such as trading firms and wholesalers despite high levies. While that's still a small amount compared to the roughly 7 million tons eaten by the Japanese each year, it represents a huge jump from the 3,004 tons imported for the entire last financial year that ended in March. Rice prices in Japan have doubled since last year after an extreme heatwave hit the 2023 harvest which was then exacerbated by stockpiling following an earthquake and additional demand from a boom in tourism. To tackle the problem, Japan's government began releasing stockpiled rice directly to retailers from late May, allowing some consumers to snap up 5 kg of rice for about US$13.85 – less than half of average supermarket prices. Japanese restaurants and consumers are increasingly turning to US brands in search of cheaper prices. Japan takes a heavily protectionist stance towards its most basic food, and traditionally has not had to rely on imports. Private-sector imports are subject to a levy of 341 yen (S$3) per kilogramme. The government can also import 100,000 tons of staple rice tariff-free under World Trade Organization rules. It decided to hold a tender for tariff-free imported rice this month, earlier than the usual auction in September, to help lower soaring prices. REUTERS
