CrossTalk: Viva Venezuela!

‘A Venezuela não ameaça os EUA, mas a Rússia sim’, diz especialista em América Latina

A afirmação é do professor de Relações Internacionais da PUC Minas Javier Vadell que diz que a análise da questão do país governado por Nicolás Maduro deve ser feita no contexto geopolítico

Redação Brasil Econômicoredacao@brasileconomico.com.br

A escalada de tensões entre Estados Unidos e Venezuela deve ser lida no contexto geopolítico global, considerando as trocas comerciais, sobretudo de armamentos, da Rússia e da China com o país governado por Nicolás Maduro. A análise é do professor de Relações Internacionais da PUC Minas Javier Vadell, especialista em América Latina. Ele diz que ao classificar a Venezuela como uma ameaça à segurança dos EUA, o governo Obama cometeu um erro. Isso pode reforçar a retórica nacionalista do líder chavista.

“Maiores sanções americanas ao regime de Maduro poderiam jogar de vez a Venezuela nos braços de Rússia e China, o que não seria muito inteligente”, diz Vadell

Foto:  Divulgação

Os superpoderes dados ao presidente Nicolás Maduro representam uma ameaça à democracia?

É preciso lembrar que esta autonomia ao Executivo foi outorgada com relação à questões de segurança e vai até o final do ano. Isso não é incomum nas democracias latino-americanas, sobretudo em momentos de crise. Já aconteceu na própria Venezuela, aconteceu na Argentina de Carlos Menem, e no Peru de Alberto Fujimori. No Brasil, a noção de medida provisória foi introduzida no período Fernando Henrique Cardoso também para autorizar o poder Executivo a decidir sobre temas de competência do poder Legislativo. Agora, no caso da Venezuela, não chega a ser inconstitucional porque está previsto na lei. Claramente,o posicionamento americano de tratar a Venezuela como uma ameaça à segurança dos EUA catalisou a crise. Vejo isso com estranheza porque há pouco tempo o próprio Obama disse o contrário. Essa retórica diferente enseja uma mudança de prática. Não custa lembrar que da última vez que os EUA fizeram isso foi com relação à Granada e ao Panamá, onde houve invasão. Não digo que acontecerá, mas o fato é que a retórica não se encerra em si.

O Sr. acha que a postura dos EUA dá subsídio ao nacionalismo venezuelano, fortalecendo Maduro?

Sim. A Venezuela passa por uma crise econômica grave. É um país muito dependente do petróleo e viu o barril cair para a casa dos US$ 50, sendo que estava acima dos US$ 100 a relativamente pouco tempo atrás. Essa fragilidade econômica trouxe uma crise de legitimidade parcial porque NicolásMaduro continua com o apoio de grande parte da população e das Forças Armadas, o que não é pouca coisa. Nesse contexto, essa mudança de retórica de Washington fortalece o elemento nacionalista e pode provocar um efeito contrário ao desejado, aglutinando ainda mais o regime frente à cruzada anti-bolivariana liderada pelos EUA.

Foi um erro de Washington?

Sim, foi um erro da política externa de Obama. Não tem muito sentido essa ameaça. Mas há um fator extra-regional nesse caleidoscópio que é o apoio técnico militar e a venda de armas, principalmente da Rússia, mas também da China à Venezuela. O discurso de Obama não é feito em relação ao perigo venezuelano, mas sim em relação à ingerência russa no continente. Já estão acontecendo exercícios militares com assessoria de Moscou , o que é normal quando se quer testar equipamentos novos. Mas isso pesou. Não podemos analisar a questão da Venezuela fora do contexto geopolítico que assiste a um agravamento das tensões entre as potências em torno da Ucrânia. Nesse sentido, maiores sanções americanas ao regime de Maduro poderiam jogar de vez a Venezuela nos braços da Rússia e da China, o que não seria muito inteligente da parte americana.

A oposição venezuelana teme que a concentração de poderes ameace as eleições legislativas este ano. Faz sentido?

A Venezuela tem um histórico de institucionalidade democrática, inclusive sob Hugo Chávez. Portanto, não vejo indícios de que as eleições legislativas poderiam não acontecer. Não há precedentes para tal. A oposição quer se antecipar a um eventual auto-golpe de Maduro para se perpetuar no poder. Mas não vejo como isso poderia ser positivo para ninguém. Criaria um ambiente de tensão e de guerra civil. Por ora, tudo indica que essa retórica nacionalista apenas vai ser explorada por Maduro para obter maioria já nesse pleito . O regime vai se vitimizar frente à ameaça imperialista para se fortalecer.

Analistas apontam o Brasil como a potência diplomática capaz de mediar as tensões nas Américas. Como o Sr. vê isso?

Faz todo o sentido, mas o Brasil está um pouco ausente da política regional. Além disso, essa liderança brasileira tem de se dar no âmbito da Unasul (União de Nações Sul-Americanas) que, inclusive, já apelou aos EUA para que retirem essa qualificação de ameaça e possíveis sanções para aliviar as tensões. Mas o Brasil deixou de lado a política externa nos últimos meses<MC0>, talvez em função das convulsões domésticas. Isso fez com que o nosso país perdesse um pouco do protagonismo em questões regionais para o Equador, do presidente Rafael Correa.<MC0> Esta é uma oportunidade para a Unasul se consolidar no continente e para o Brasil fazer o mesmo dentro do bloco. Mas isso está muito lento, muito verde.

As tensões com a Venezuela podem atrapalhar a reaproximação entre EUA e Cuba?

Não acho. Embora Cuba já tenha se posicionado a favor da Venezuela, acho que as embaixadas serão reabertas. Essa negociação tem sido bem pragmática.

Colaborou o estagiário Gabriel Vasconcelos

Fonte: Brasil Econômico

Swedish Prosecutor in Julian Assange’s Case Retreats; US Continues Espionage Investigation

Michael Ratner says the real threat to Assange is the continuing espionage investigation against him and Wikileaks -   March 17, 2015

Fonte: The Real News Network

The Non-Problem of Chinese Currency Manipulation

CAMBRIDGE – America’s two political parties rarely agree, but one thing that unites them is their anger about “currency manipulation,” especially by China. Perhaps spurred by the recent appreciation of the dollar and the first signs that it is eroding net exports, congressional Democrats and Republicans are once again considering legislation to counter what they view as unfair currency undervaluation. The proposed measures include countervailing duties against imports from offending countries, even though this would conflict with international trade rules.
This is the wrong approach. Even if one accepts that it is possible to identify currency manipulation, China no longer qualifies. Under recent conditions, if China allowed the renminbi to float freely, without intervention, it would be more likely to depreciate than rise against the dollar, making it harder for US producers to compete in international markets.

But there is a more fundamental point: From an economic viewpoint, currency manipulation or unfair undervaluation are exceedingly hard to pin down conceptually. The renminbi’s slight depreciation against the dollar in 2014 is not evidence of it; many other currencies, most notably the yen and the euro, depreciated by far more last year. As a result, the overall value of the renminbi was actually up slightly on an average basis.
The sine qua non of manipulation is currency-market intervention: selling the domestic currency and buying foreign currencies to keep the foreign-exchange value lower than it would otherwise be. To be sure, the People’s Bank of China (PBOC) did a lot of this over the last ten years. Capital inflows contributed to a large balance-of-payments surplus, and the authorities bought US dollars, thereby resisting upward pressure on the renminbi. The result was as an all-time record level of foreign exchange reserves, reaching $3.99 trillion by July 2014.
But the situation has recently changed. In 2014, China’s capital flows reversed direction, showing substantial net capital outflows. As a result, the overall balance of payments turned negative in the second half of the year, and the PBOC actually intervened to dampen the renminbi’s depreciation. Foreign-exchange reserves fell to $3.84 trillion by January 2015.
There is no reason to think that this recent trend will reverse in the near future. The downward pressure on the renminbi relative to the dollar reflects the US economy’s relatively strong recovery, which has prompted the Federal Reserve to end a long period of monetary easing, and China’s economic slowdown, which has prompted the PBOC to start a new period of monetary stimulus.
Similar economic fundamentals are also at work in other countries. Congressional proposals to include currency provisions in the Trans-Pacific Partnership, the mega-regional free-trade agreement currently in the final stage of negotiations, presumably target Japan (as China is not included in the TPP). Congress may also want to target the eurozone in coming negotiations on the Transatlantic Trade and Investment Partnership.
But it has been years since the Bank of Japan or the European Central Bank intervened in the foreign-exchange market. Indeed, at an unheralded G-7 ministers’ meeting two years ago, they agreed to a US Treasury proposal to refrain from unilateral foreign-exchange intervention. Those who charge Japan or the eurozone with pursuing currency wars have in mind the renewed monetary stimulus implied by their central banks’ recent quantitative easing programs. But, as the US government knows well, countries with faltering economies cannot be asked to refrain from lowering interest rates just because the likely effects include currency depreciation.
Indeed, it was the US that had to explain to the world that monetary stimulus is not currency manipulation when it undertook quantitative easing in 2010. At the time, Brazilian Finance Minister Guido Mantega coined the phrase “currency wars” and accused the US of being the main aggressor. In fact, the US has not intervened in a major way in the currency market to sell dollars since the coordinated interventions associated with the Plaza Accord in 1985.
Other criteria besides currency-market intervention are used to ascertain whether a currency is deliberately undervalued or, in the words of the International Monetary Fund’s Articles of Agreement, “manipulated” for “unfair competitive advantage.” One criterion is an inappropriately large trade or current-account surplus. Another is an inappropriately low real (inflation-adjusted) foreign-exchange value. But many countries have large trade surpluses or weak currencies. Usually it is difficult to say whether they are appropriate.
Ten years ago, the renminbi did seem to meet all of the criteria for undervaluation. But this is no longer the case. The renminbi’s real value rose from 2006 to 2013. The most recent purchasing power statistics show the currency to be in a range that is normal for a country with per capita real income of around $10,000.
By contrast, the criterion on which the US Congress focuses – the bilateral trade balance – is irrelevant to economists (and to the IMF rules). It is true that China’s bilateral trade surplus with the US is as big as ever. But China also runs bilateral deficits with Saudi Arabia, Australia, and other exporters of oil and minerals, and with South Korea, from which it imports components that go into its manufactured exports. Indeed, imported inputs account for roughly 95% of the value of a “Chinese” smartphone exported to the US; only 5% is Chinese value added. The point is that bilateral trade balances have little meaning.
Congress requires by law that the US Treasury report to it twice a year which countries are guilty of currency manipulation, with the bilateral trade balance specified as one of the criteria. But Congress should be careful what it wishes for. It would be ironic if China agreed to US demands to float the renminbi and the result was a depreciation that boosted its exporters’ international competitiveness

Jeffrey Frankel, a professor at Harvard University’s Kennedy School of Government, previously served as a member of President Bill Clinton’s Council of Economic Advisers. He directs the Program in International Finance and Macroeconomics at the US National Bureau of Economic Research

Fonte: Project Syndicate

The Looming U.S.-India Trade War

The Looming U.S.-India Trade War

All seems simpatico between New Delhi and Washington. But with the Trans-Pacific Partnership on the horizon, tensions between the two are certain to boil over.

If international relations were about cultivating personal chemistry, you might assume that the U.S.-India relationship has never been stronger. Indian Prime Minister Narendra Modi’s visit to Washington last September, full of warm and fuzzy moments and buoyed by a sense of bonhomie, suggested a growing camaraderie between the nations. Following closely on the heels of that meeting, President Barack Obama became the first sitting president in history to visit India twice, and the first to be named guest of honor at its Republic Day celebrations on January 26, 2015.

But look past the veneer of chumminess, and you’ll see that the era of good feelings is likely to be short-lived, as simmering disputes between Washington and New Delhi retake their place at center stage. Among the most important are likely to be their vastly differing trade priorities, as each competes for a piece of the world market and plays a high-stakes game to ensure that its businesses and workers get a larger share of the pie.

One of the key sticking points is a trade disagreement that has now reached the dispute settlement body of the World Trade Organization (WTO). The United States alleges that India’s domestic procurement requirements for solar cells and modules violate WTO rules, which mandate fair and non-discriminatory access to both foreign and domestic firms, while India contends that the United States unfairly subsidizes its own solar technology manufacturers. Typically, a case under the dispute settlement body runs anywhere from a year to a year and a half, and the decision is binding for the losing party.

It’s difficult to see how India and the United States will find common ground on this issue. Obama has made it abundantly clear that one of his administration’s key goals is to create high-quality jobs by pushing U.S. exports and manufacturing in overseas markets. This was a central theme in the State of the Union address, which he delivered just before coming to India, and one he reiterated at a summit of American and Indian business leaders in New Delhi. Washington will not take kindly to being shut out of a large and growing market for solar technology in India, a key plank in Modi’s plan to increase the share of renewables in India’s energy mix.

For its part, the Indian government has made it very clear that promoting domestic manufacturing under the “Make in India” program is a cornerstone of its policy to jumpstart growth and generate millions of new jobs. For better or worse, domestic procurement rules are one of the time-tested tools that governments around the world use to even the competition for domestic manufacturers.

New Delhi and Washington’s positions seem downright irreconcilable. In fact, shortly after Obama’s visit, reports in India suggested that the state-owned National Thermal Power Corporation would soon put out bids for new solar projects, available only to domestic manufacturers. That’s unlikely to help resolve things.

But the solar dispute is only one piece of a much larger philosophical divide. An equally important, unresolved source of friction between India and the United States is their positions on intellectual property protection (IPP), and on the relationship of IPP and international trade agreements.

Large, deep-pocketed American pharmaceutical companies with powerful lobbies in Washington want India to strengthen its regulatory regime. For instance: they want India to extend patent protections to new drugs and not allow compulsory licensing, whereby makers of generic drugs are allowed to manufacture patented pharmaceuticals.

Here, India appears to have made a fairly major concession to the United States. Its long-standing position has been that IPP is a domestic matter, not one to be negotiated with trading partners. But during Modi’s visit to the United States last fall, India agreed to discuss its evolving IPP regime in a joint working group with U.S. experts. The report from those discussions has yet to be released, perhaps suggesting some difficulty in reaching a consensus.

On the other side of the fence, Indian generics manufacturers — the largest source of generics in the world — fear that they will lose much of their business if India adopts U.S.-style patent protection, which privileges the inventors of new drugs and limits availability of cheaper generic alternatives. What’s more, public health advocates and non-governmental organizations fear that moving to a tougher regime would raise the cost of life-saving drugs for those both in India and in developing countries that depend on its generics instead of the costly American originals.

The IPP issue resides at the heart of the proposed Trans Pacific Partnership (TPP), a free trade agreement among 12 nations in the Asia Pacific accounting for 40 percent of world gross domestic product and one-third of world trade. Pointedly, the TPP includes neither China nor India.

If India remains outside the TPP — the likely outcome, as there is no indication that the original 12 wish to open up to potential new members until they have first struck a deal among themselves — India is likely to lose out on major market access. One study from the Indian Institute of Foreign Trade, a think tank, released in May 2014 finds that the TPP’s big winners would be countries like Japan, Korea and Malaysia. India, meanwhile, is likely to end up a loser, due to what economists call “trade diversion.” This occurs when a free trade area shifts production away from more efficient suppliers locked out of the agreement, to less efficient suppliers that are part of the agreement. This would hurt India. Its textile manufacturers, for example, worry that they will lose out on the lucrative U.S. market, in favor of suppliers in Vietnam, a TPP member.

Intellectual property regulations would be at the core of the TPP’s potential negative impacts on India. If India joined the TPP in the future, it would almost certainly have to replicate the patent regime built into the agreement. This would extend and worsen the difficulties India faces on pharmaceuticals into a range of sectors where trademark and copyright laws are important, including publishing, music, and film production — the TPP’s IPP regulations, after all, are more stringent. Another study, also by the Indian Institute of Foreign Trade in May 2014, concludes: “the costs of conforming to the TPP’s [intellectual property regime] Chapter are greater than any potential market access gains from joining the TPP.”

The TPP also includes a host of stringent labor and environment standards that India — and, for that matter, most emerging economies — would fail to meet. There’s no indication that the Modi government has any plans to cave on these standards, the adoption of which would seriously erode India’s competitiveness, anymore than it has shown any inclination to cave on climate change — yet another area where India and the United States remain at logger heads.

It’s very hard to see how the new-found friendship between Obama and Modi can resolve these tensions. Now that he’s unburdened by the need to win another election or help his party win, Obama is free to be as aggressive as he wishes in pursuing his policy agenda. In search of a legacy, bringing the TPP to fruition would be a feather in his cap, much as the India-US civil nuclear accord became a late foreign policy triumph for George W. Bush back in 2009.

Obama’s State of the Union was quite striking for the strength of its rhetoric. Indeed, when it comes to the rules of global commerce, he said: “We should write those rules.” This may play well in Peoria. But leaders of other major economies like India are unlikely to sit back and accept dictation from Washington on how to run their own economies.

Saul Loeb / AFP

Fonte: Foreign Policy

Rethinking Currency Manipulation

Interest groups in the United States have focused on the possibility of including provisions in trade agreements with the intent of countering currency manipulation.  The concern is that another country may choose to reduce the value of its currency relative to the U.S. dollar in order to encourage its businesses to export more goods to the United States.   Such currency realignment also would tend to make it more expensive for the devaluing nation to import products from this country.

It’s true that an adjustment in currency exchange rates – regardless of the reason for the adjustment – can have an effect on trade flows.  U.S. industries that export to foreign customers, or compete with imported goods in the domestic marketplace, understandably would prefer that currency relationships not become skewed against their commercial interests.  Currency stability improves the business climate by making it easier to build long-term relationships with customers and suppliers.

However, currency exchange rates have fluctuated throughout recorded history.  Sometimes those changes may be driven by a government’s conscious desire to devalue its currency.  More often the variability in exchange rates reflects fundamental economic realities.  Economies that experience growing productivity and rising prosperity should not be surprised to find that market pressures cause their currencies to strengthen.  The reverse is true for countries that are growing slowly or not at all.

A shift in exchange rates changes a country’s “terms of trade,” which is a term  used by economists to describe the ratio of a country’s export prices to its import prices.  From a U.S. perspective, if another country sets its currency at an artificially low level relative to the dollar, the U.S. terms of trade will improve.  The United States will be able to obtain a greater value of imports for the same value of exports.  Exporting the same number of airplanes and soybeans as before will pay for the importation of larger quantities of shoes, coffee, and automobiles.

The country that chooses to undervalue its currency will be placing an artificially low value on the output created by workers and capital in its domestic economy.  It will, in effect, be selling its exports for less than their true economic worth, thus transferring wealth to the United States.  People in this country experience meaningful increases in their standards of living at the expense of the country that has devalued.

Yes, most buyers like to get a good deal.  An increase in affordable imports generally doesn’t strike consumers as a bad thing.  Assuming those imports don’t compete too directly with goods and services produced widely in the United States (think of coffee, bananas, shoes, clothing, diamonds, rare earth metals, etc.), they tend to be well accepted even by people with mercantilist tendencies.   Some imports that do compete directly with U.S. products – such as crude oil or cars – also may not raise strong political objections, either because domestic demand is larger than can be served solely by domestic supplies, or because consumers desire a variety of choices.

The politics of affordable imports become more complicated when those products compete directly with goods and services produced in the importing country.  Competition always is a challenge, whether it comes from other domestic firms or from overseas.  Firms often struggle to deal with forces as diverse as changing technology or changing consumer tastes and preferences.  Not all firms survive forever.  Rather, the process of creative destruction keeps the economy in an ongoing state of reinvigoration and renewal.  There’s no doubt, though, that an increase in imports can create adjustment headaches for import-competing U.S. companies and their workers.

The good news is that the United States already has a policy framework with which to address unfairly priced imports, regardless of whether those imports relate to currency undervaluation.  U.S. trade remedy laws allow industries to seek antidumping or countervailing duty (AD/CVD) protection against imports that may be injuring domestic producers.  From a free-trade perspective, it’s important to understand that U.S. trade remedy laws leave a lot to be desired.  They generally are seen to be relatively protectionist – slanted in favor domestic industries over imports.

However, trade remedies are a better policy response (even though suboptimal) to currency manipulation than would be the case for special provisions in trade agreements.  Trade remedies are relatively selective.  They are applied only to unfairly priced imports that are troublesome to U.S. industries, and only after those producers have demonstrated that they’ve been injured.  On the other hand, currency provisions included in trade agreements would apply to all imports from the offending country.  American consumers would end up paying more even for tea and T-shirts, for which there is little or no U.S. production.  Given the broad negative implications of using trade agreement provisions to counteract currency manipulation, U.S consumers would be much better off dealing with the narrower negative consequences of AD/CVD measures.

A concluding thought:  Since currency undervaluation by other countries serves to transfer wealth to the United States, should we consider finding some diplomatic way to thank them?  Such a gesture likely would do far more good than including misguided currency provisions in trade agreements.  It might help prompt policymakers around the world to rethink the plusses and minuses of allowing currencies to get out of alignment.

Fonte: Cato Institute

US files dispute against China over alleged export-contingent subsidies to enterprises

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11 February 2015

The United States notified the WTO Secretariat on 11 February 2015 of a request for consultations with China regarding certain measures that allegedly provide export-contingent subsidies to enterprises in several industrial sectors. These sectors include textiles, agriculture, medical products, light industry, special chemical engineering, new materials, and hardware and building materials.

According to the US, China designates a cluster of enterprises in a particular industry as a Demonstration Base and then provides export-contingent subsidies to those enterprises. In addition, the US argues that China provides certain other export-contingent subsidies to Chinese manufacturers, producers, and farmers.

Fonte: OMC