Is Trade and Its Expanded Definition Now the Core of International Relations? Seems So ….

Trade and Airplane


      A host of  very broad trade issues continue to arise globally the last few weeks especially including their legal and policy aspects. They demonstrate how broad and encompassing global trade realties are today. Some include the following: new Chinese tech rules and a Chinese antitrust case involving U.S. firms; the U.S. Foreign Sovereign Immunities Act; investor-state arbitration provisions in trade negotiations (TPP and TTIP); currency manipulation and ‘fast track’; state-owned enterprises (SOEs) in aviation; ‘Weaponized finance (as trade sanctions in foreign policy involving national security), among others. “Trade” continues to expand the areas it now covers, way beyond what was thought of just a few years ago. In many ways this is now becoming the core of international relations.


  • Interview with USTR Froman discussing TPP, globalization, income equality, trader agreements and fast track. “Politics of Trade.” New York Times (Feb.7, 2015).
  • New national security strategy report by the Obama administration includes further promoting ‘rules of the road,’ strengthening global institutions, and further supporting trade agenda (TPP, TTIP). “Fact Sheet — The 2015 National Security Strategy.” (White House 2015).
  • LLCs & offshore shell companies allow billions of questionable dollars (often criminal and result of international tax evasion) to be invested in to the U.S. (for example into elite New York City real estate condos). This evidences the often unmanageable cross-border flow of funds and violation of money laundering laws. This also reflects globalization of the financial markets, insufficient state corporate laws, local real estate recording lows, and adverse impact on local  markets.  “Foreign Investment in U.S. (NYC) Real Estate.” New York Times (Feb. 8th, 2015). 
  • China hits Qualcomm for an almost $1bn fine for violating its antitrust rules concerning licensing and cross-licensing of intellectual property rights (patents). This escalates trade friction with the U.S. and multinationals to a higher level. “China and Qualcomm.” New York Times (Feb. 10, 2015). 
  • The U.S. filed a new case against China over “Demonstration Bases – Common Service Platforms.” These are geographical clusters of 150 similar firms of an industry or sub-sectors which receive lower-priced discounted services. The U.S. argues these discounts amount to an export subsidy. “U.S. Launches Challenge to Extensive Chinese Export Subsidy Program.” USTR News (Feb. 11, 2015). “White House Files New China Trade Case in WTO.New York Times (Feb. 11, 2015). “U.S. -China Dispute over Export-Contingent Subsidies.WTO News (Feb. 11, 2015) (relating to textiles, agriculture, medical products, light industry, chemical engineering, new materials and building materials). 
  • Editorial by the Financial Times against including  currency manipulation provisions in ‘Fast Track’. They are not workable. “US Congress Threatens Trade Deal with Currency Debate.Financial Times (Feb. 12, 2015).
  • Chinese antidumping duty on steel from EU and Japanese firms found to be improper. “EU / Japan win in WTO Panel Against China.” Japan Times (February 13, 2015).
  • New Congressional proposal to extend the reach of U.S. law (Foreign Sovereign Immunities Act) to foreign states (terrorism financing).” JASTA and FSIA.” The American Lawyer (2.17.15).
  • A panel has been established by the WTO pursuant to a request by the EU concerning Boeing as to  extension of  U.S. tax measures (Washington state measures favoring domestic over imported goods). The EU alleges these are prohibited subsidies.” Panel Established on EU Complaint against U.S. Over Large Commercial Aircraft,” WTO News (Feb. 23, 2015)
  • Warren attacks arbitration provisions (Investor-State Dispute Settlement — ISDS provisions) in TPP. Warren and TPP.” Washington Post (2.25.15)
  • New proposed Internet regulations in China and recent Chinese antitrust decisions have the potential of significantly reducing the business opportunities of U.S. Internet, telecom, and social media firms in China. Part of broader trade relations between China and the U.S. raising issues of cybersecurity and national security. China has some valid reason to be concerned as well as the U.S. “China, Technology and Suspicion.” New York Times (Feb. 28, 2015).
  •  The New York Times argues that currency manipulation should be included in the TransPacific Partnership negotiations. “Role of Congress in Trade (Fast Track / TPP).” New York Times (March 2, 2015).
  • Investor-State Dispute Settlement provisions (ISDS) and the TPP. These provisions are important when investing in countries with weaker legal systems. It’s a mechanism of international adjudication that allows mitigating risks of foreign investments. “TPP and ISDS.” Wall Street Journal (3.3.15).
  • Do tech firms have an advantage over telecoms because of overseas tax avoidance? “Tech and Telecoms.” New York Times (March 2, 2015).
  • Obama criticizes China’s new rules for banking technology rules (source code, encryption, back-door key) and possible extension to other sectors. China is concerned about national security and the U.S. sees these rules as protectionism. “China’s New Technology Rules Concerning Source Code, Encryption, Back-Door Key.” New York Times (March 4, 2015).
  • The use of restrictions on international finance as trade sanctions is viewed as “weaponization of finance.” Imposes pain but changes behavior little. Perhaps even encourage counter-measures such as cyber attacks.  “Weaponized Finance.” Financial Times (March 4, 2015).
  • MNCs fighting U.S. lawsuits as to global human rights violations. S.Ct. supports them. “Companies and Human Rights.” New York Times (March 6, 2015).
  • Three Gulf airlines (Qatar, Emirates and Etihad) are under attack by U.S. carriers as state-owned enterprises that receive state subsidies. But these aviation issue do not fall under the WTO rules. Have separate bilateral ‘Open-Skies Treaties’ that govern this sector. U.S. Airlines Attack Gulf Airlines for Subsidies.Wall Street Journal (March 7, 2015).

About Stuart Malawer

Distinguished Service Professor of Law & International Trade at George Mason University (Schar School of Public Policy).
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