Archive for April 20th, 2005
U.S. Judge Blocks Chinese Textile Quotas
In late December 2004, Judge Richard Goldberg of the U.S. Court of International Justice blocked the United States from imposing emergency quotes on the import of textiles from China.
In order to appease U.S. textile companies, the Commerce Department prepared to impose a number of emergency quotas on the import of jeans, underwear and other clothing products from China. U.S. clothing retailers filed a lawsuit arguing that they would suffer irreparable damage if the emergency quotes were to go into effect.
Goldberg issued a temporary injunction barring the quotas from going into effect, agreeing that retailers would suffer irreparable harm from the quotas and that the quotas should be blocked while the court heard the case.
Under trade agreements that the United States is signed, this year it must remove its textile quota system. Textile companies fear that once the artificial barriers against Chinese textiles are removed, that Chinese textiles will flood the U.S. market. And that would be bad how?
The textile companies created this very situation. Rather than gradually phase out the quotas, they clung to them to protect their anti-competitive products, and now face the prospect of the quotas disappearing with one fell swoop.
The U.S., meanwhile, continues to play the role of preaching the wonders of free trade and the importance of adhering to international trade agreements . . . unless U.S. special interests find this inconvenient, in which case all bets are off and suddenly protectionism is all the rage.
Sources:
U.S. Judge Bars Limits on Imports of China Textiles. Reuters, December 31, 2004.
US Textile Makers Lose Bid to Cap Chinese Imports. Xinhua News Agency, January 2, 2005.
Tags: China, Free Trade
UN Releases Report Recommending Ways to Achieve Millennium Development Goals
In 2000, most nations signed on to the Millennium Development Goals which committed those nations to cutting in half poverty and related problems by 2015. Of course the world is nowhere near achieving those goals. Enter former Harvard economist Jeffrey Sachs who recently authored a report for the United Nations, Investing In Development, which offers an analysis of the current state of the Millennium Development Goals and makes recommendations to reach the goals by 2015.
In sub-Saharan Africa, for example, the report notes,
The region is off track to meet every Millennium Development Goal. It has the highest rate of undernourishment, with one-third of the population below the
minimum level of dietary energy consumption. Sub-Saharan Africa has the
lowest primary enrollment rates of all regions. Despite recent progress, gender
disparity at the primary level is 0.86, the lowest of all regions
In West Asia,
This region, which includes many countries typically classified as part of the
Middle East, is off track for a majority of the Goals. Both income poverty
and hunger are increasing, and progress toward gender equality has been slow.
Primary enrollments increased only from 81 percent in 1990 to 83 percent in
2001, and under-five mortality fell only slightly from 68 per 1,000 live births
to 61 in the same period. Maternal mortality remains high, and infectious diseases
such as TB are still a threat. While urban areas are on track to meet the
water and sanitation Goal, rural areas are lagging behind. Youth unemployment
is a significant concern in the region.
Certainly there are some success stories, but even these are moderated by mixed results. North Africa, for example, is on target to meet the development goals of halving poverty, but its economic growth has had little to no impact on the rate of undernourished children which remains today at roughly the same level it was 25 years ago!
Sachs sites four reasons that the world has failed to make more progress. First and foremost is governance failure. As Sachs’ report blandly puts it,
Economic development stalls when governments do not uphold the rule of
law, pursue sound economic policy, make appropriate public investments,
manage a public administration, protect basic human rights, and support civil
society organizations
To put it a bit less politic, if you’re stuck in Zimbabwe, you’re screwed.
Another reason for the failure is what Sachs calls “poverty traps” — essentially areas of the world that are too poor to do anything about their poverty. Finally there are pockets of poverty, where certain areas of a country persist in poverty while the rest of the nation prospers, and specific policy neglect (South Africa’s bizarre approach to the AIDS crisis over the past decade, for example).
The report then offers a complex analysis which can be boiled down to this: past efforts at aiding countries to climb out of poverty have failed because they have been misdirected and based on incorrect assumptions. So donor countries and NGOs should stop making those mistakes and everything will be right as rain. Specifically, the report recommends concentrating any aid dollars on low-income countries which have good governance in place.
Of course the report includes as such potential good bets countries such as Bangladesh, Ethiopia, and Nepal, all three of which have serious internal political problems which pose a formidable problem for would be aid donors.
Which ultimately explains why most developed countries don’t come close to the Millennium goal of donating 0.7 percent of their GDP to foreign aid. Given all of the complexities that developing nations face, its just not easy to predict what the effects of aid will ultimately be. Given the failures of external aid projects over the past 3-4 decades, aid these days seems to be directed at what is politically popular in the donor country rather than what makes sense for the receiving country (which is why, for example, money for HIV amelioration is such a hot topic in the United States, but the word “malaria” is hardly ever heard in public discourse about foreign aid).
If you’re as likely to fail as succeed anyway, might as well get some votes out of it.
Source:
UN urges rapid action on poverty. The BBC, January 17, 2005.
Investing In Development: A Practical Plan to Achieve the Millennium Development Goals. Millennium Project, 2005.
Tags: United Nations