Dumping is good

. . . is the topic of my latest Trade Tripper column in this Friday-Saturday issue of BusinessWorld. Excerpts:

"That’s why the WTO’s 2009 World Trade Report is getting much discussion among trade law practitioners. Because ironically, according to the report, considering the increase of anti-dumping cases, dumping apparently is good for the importing country:

'What are the effects of dumping on the economic welfare of the importing country? Economic theory suggests that, with the possible exception of predatory dumping, all other instances of dumping either increase, or at worst, have an ambiguous effect on, the economic welfare of the importing country. Of course, for the most part, economic literature has treated dumping as an example of the exercise of market power. But within this context of imperfectly competitive markets, dumping may increase efficiency in resource allocation. In most circumstances, the welfare of the importing country increases as a result of dumping, as consumers and users of the product benefit from lower import prices, even though the reason for the reduction in price (the dumping) may vary.'"


No, it's not okay

. . . (that we lower our standards) is the topic of my latest Trade Tripper column in this Friday-Saturday issue of BusinessWorld. Excerpts:

"No. It’s not okay. We don’t want to be Fiddle and Faddle’s friends, we don’t want a lesson on the correct way to pronounce gyro’s, we don’t want the free coffee from next door, and we certainly don’t want any more vapid smiles. We just want our lunch, served, properly, cleanly, and correctly. This is not nuclear science.

We had a good lunch at the nearby Tsoko.Nut Batirol instead. The waiting staff was quietly efficient, informed, and (thankfully) reserved.

Somebody in a local magazine wrote a few weeks back that not only waiters but also customers should do their part in having a good dining experience. True. But people who get paid to do something (with the customer’s hard-earned money) better make sure they’re doing their jobs first. Nobody deserves something for nothing. Customers (and everybody else for that matter) should do their part by not letting standards slip. And — incidentally — that is why nobody should boorishly go to restaurants or any public place in shorts or sandos just because one has money to spend. Far richer people in far more sophisticated countries than ours still discipline themselves by being courteous in dress and manner.

This lowering of expectations is what’s destroying this country. If anybody wants to know one reason why the Philippines is going down, one just has to look at the smiling work of the friendly Fiddle and Faddle."


Trade in the NY Times

The New York Times gets trade conscious, with these two articles: one on Doha and the other on farm subsidies.

Shuffling amidst the slog

. . . that is the global economy is the topic of my latest Trade Tripper column in this Friday-Saturday issue of BusinessWorld. Excerpts:

"Having said that, protectionism, particularly of the 'creeping' kind, seems to be keeping a steady presence. WTO Director-General Pascal Lamy recently declared that there seems to be "further slippage" as far as protectionism is concerned. The WTO indeed found that in the period March to mid-June of this year, 119 new trade measures were instituted, of which 83 were classified as trade restricting. These figures do not yet include measures implemented in response or related to the H1N1 outbreak.

However, of the most recent kinds of protectionist measures, the one with the most profound effect on global attitude toward trade seem to be the 'buy local' provisions, particularly that enacted by the US. The US law provides that no funds appropriated under the law shall be used for a project for the construction or repair of a public work unless all of the iron, steel, and manufactured goods used in the project are produced in the US."


WTO, IP, and Caritas in Veritate

Interestingly, at the WIPO Conference on Intellectual Property and Public Policy Issues on 14 July 2009, WTO Director-General Pascal Lamy's statement that “the international intellectual property system cannot operate in isolation from broader public policy questions such as how to meet human needs as basic health, food and a clean environment,” closely follows Pope Benedict XVI's brilliant encyclical Caritas in Veritate, wherein it is written: "On the part of rich countries there is excessive zeal for protecting knowledge through an unduly rigid assertion of the right to intellectual property, especially in the field of health care."

What must be noted are the different emphasis between the two "statements": one is technical, the other moral. Lamy goes on to discuss the focus on technical matters:

"The effective use of the IP system and of TRIPS flexibilities is important, but does not stand alone: IP law and policy must be harnessed with drug procurement policies, pro-competition safeguards, and regulation of drugs for safety and quality. Again, no one international agency has a monopoly on these diverse areas of expertise, and the challenge of ensuring practical access to medicines requires a comprehensive, multidisciplinary effort."

The encyclical has this to say:

“Truth needs to be sought, found and expressed within the ‘economy’ of charity, but charity in its turn needs to be understood, confirmed and practiced in the light of truth. In this way, not only do we do a service to charity enlightened by truth, but we also help give credibility to truth, demonstrating its persuasive and authenticating power in the practical setting of social living. This is a matter of no small account today, in a social and cultural context which relativizes truth, often paying little heed to it and showing increasing reluctance to acknowledge its existence.” (2)

“The risk for our time is that the de facto interdependence of people and nations is not matched by ethical interactions of consciences and minds that would give rise to truly human development. Only in charity, illumined by the light of reason and faith, is it possible to pursue development goals that possess a more humane and humanizing value. The sharing of goods and resources, from which authentic development proceeds, is not guaranteed by merely technical progress and relationships of utility, but by the potential of love that overcomes evil with good (cf. Rom 12:21), opening up the path towards reciprocity of conscience and liberties.” (9)

“The world’s wealth is growing in absolute terms, but inequalities are on the increase. In rich countries, new sectors of society are succumbing to poverty and new forms of poverty are emerging. In poorer areas some groups enjoy a sort of ‘superdevelopment’ of a wasteful and consumerist kind which forms an unacceptable contrast with the ongoing situations of dehumanizing deprivation.” (22)


Caritas in Veritate

Here's an interesting piece by the New York Times' Ross Douthat on Pope Benedict XVI's new encyclical:

"'Caritas in Veritate' promotes a vision of economic solidarity rooted in moral conservatism. It links the dignity of labor to the sanctity of marriage. It praises the redistribution of wealth while emphasizing the importance of decentralized governance. It connects the despoiling of the environment to the mass destruction of human embryos."

For copy of the encyclical, click here.


Country tariff data

Here's a nice useful WTO page. Users can research on bound and applied tariff rates of different WTO members. For Philippine data, click here.


On dignity

David Brooks' column today at the New York Times is about In Search Of Dignity. Every Filipino should read this. Our rapidly deteriorating country really needs a huge shot of dignity in the arm right now. Anyway, here are excerpts from Brooks' article:

"The dignity code commanded its followers to be disinterested — to endeavor to put national interests above personal interests. It commanded its followers to be reticent — to never degrade intimate emotions by parading them in public. It also commanded its followers to be dispassionate — to distrust rashness, zealotry, fury and political enthusiasm.

Remnants of the dignity code lasted for decades. For most of American history, politicians did not publicly campaign for president. It was thought that the act of publicly promoting oneself was ruinously corrupting. For most of American history, memoirists passed over the intimacies of private life. Even in the 19th century, people were appalled that journalists might pollute a wedding by covering it in the press.

Today, Americans still lavishly admire people who are naturally dignified, whether they are in sports (Joe DiMaggio and Tom Landry), entertainment (Lauren Bacall and Tom Hanks) or politics (Ronald Reagan and Martin Luther King Jr.).

x x x

The old dignity code has not survived modern life. The costs of its demise are there for all to see. Every week there are new scandals featuring people who simply do not know how to act."

Regulating foreign monopolies

. . . is the topic of my latest Trade Tripper column in this Friday-Saturday issue of BusinessWorld. Excerpt:

"Competition policy, in its simplest form, primarily deals with the state of competition internally, that is, with regard to the state of competition within a country’s borders. However, what Philippine policymakers and lawmakers should consciously focus on, considering the present economic situation, is competition policy viewed from an international perspective, particularly when monopolies or cartels reach across borders and where price-fixing is done not within a single country but in a number of such. This is a highly complex but profoundly significant matter that needs to be recognized. Our problem is not the huge and competitive Philippine company that is really doing well. The probability that the concept of "natural monopolies," considering the small size of our domestic market, is applicable is with merit. If anything, therefore, Filipinos should perhaps be supportive of an even larger Filipino conglomerate. A San Miguel Corporation, for example, despite its size and reach, could not really be considered as possessing monopoly power due to the nature and threat presented by its external (i.e., foreign) competition."


Age of me

In today's youth obsessed i-Pod culture, this article rings so true:

"Everything is about ME. Life is, and should be, about ME and what I want, what I decide will make ME happy, and get ME the most I can possibly get. Decisions made by other people must not make any requirements of ME, or place any restrictions on ME. If they do, I have every right to disregard them, denounce them, and demand change."


Praying the Liturgy of the Hours

I have committed, starting today (although I'm really very much still in the learning stage) to daily pray the Liturgy of the Hours. More accurately, recognizing the fact that I'm a layman, I'm praying the shorter version, from the book Christian Prayer (and not the 4 volume Breviary, which members of the clergy use).

I invite fellow Filipino Catholics to pray the Liturgy of the Hours. As Jesus told us, "pray always". Here are some sites for further info on it and get you started: here, here, here, and here. A copy of the Christian Prayer is available in any St. Paul bookstore.

Pope deplores Cotabato attack

Pope Benedict XVI deplored the attack in front of the Cathedral of the Immaculate Conception in Cotabato.

It is suspected that the attack, killing 5 (including a 3 year old child) and wounding 45, is the work of the rebel Moro Islamic Liberation Front (MILF).

Archbishop Orlando Quevedo declared - rightly - that the attack is “not only a crime, but a sacrilege." The Pope, on the other hand, condemned "the use of violence, which is never a way of solving problems."


Go easy on the stimulus

The ADB says that we should go focus more on stimulus spending.


After all, stimulus spending doesn't seem to be working for the US (as can be seen from this rather neutral article from an Obama-friendly magazine):

". . .public doubts about the stimulus have, if anything, deepened. The economy deteriorated faster than economists expected, with unemployment now predicted to exceed 10% next year, higher than the White House had projected in January."

In the end, how comfortable is the Filipino in letting the government have more money and deciding where to spend it? For me, the way out of the economic hole we have right now in a more fundamental sense (which should be our focus as our economic situation isn't as dire as the other countries) is dependent on our private sector competitiveness and improving the quality of our education (the latter of which does not necessarily mean substantial increase in spending in that regard).

Climate change trade-offs

. . . is the topic of my latest Trade Tripper column in this Friday-Saturday issue of BusinessWorld. Excerpts:

"Nevertheless, the probability that border tax measures will be implemented by developed countries against developing countries is considerable. The additional costs are simply too disconcerting to a lot of developed countries’ domestic industries. The American Petroleum Institute estimates that one in six US refineries would most likely shut down by 2020 because of such additional costs, with related transport industries increasing their own costs by an additional $178 billion annually."

"And wait for developed countries’ attempt to curb — due to climate change concerns — immigration from and job outsourcing to developing countries."

In relation to protectionism vis-a-vis migration, this article from The Economist is a worthwhile read.


Philippines as failed State

The Philippines is apparently a "failed State", if Foreign Policy's 2009 Failed State Index is to be believed (click here). The Index makes use of 12 indicators (i.e., Demographic Pressures, Refugees/IDPs, Group Grievance, Human Flight, Uneven Development, Economic Decline, Delegitimization of the State, Public Services, Human Rights, Security Apparatus, Factionalized Elites, and External Intervention) of State cohesion and performance, compiled through a close examination of more than 30,000 publicly available sources.

A "failed State" is said to have certain attributes. One of the most common is the loss of physical control of its territory or a monopoly on the legitimate use of force. Other attributes of State failure include the erosion of legitimate authority to make collective decisions, an inability to provide reasonable public services, and the inability to interact with other states as a full member of the international community. The 12 indicators cover a wide range of elements of the risk of state failure, such as extensive corruption and criminal behavior, inability to collect taxes or otherwise draw on citizen support, large-scale involuntary dislocation of the population, sharp economic decline, group-based inequality, institutionalized persecution or discrimination, severe demographic pressures, brain drain, and environmental decay.

Of 177 States examined in order from most to least at risk of failure, 60 most vulnerable states are then listed in the failed State Index rankings. The Philippines ranks 53.