Trade Links: New Rules for a New World

404 Pages·2022·1.879 MB·English

by  James Bacchus

Trade Links
The World Trade Organization is undergoing an existential crisis.
Trade links the worldnot only through the flow of international com-
merce in goods, services, and ideas, but also through its economic,
environmental, and social impacts. Trade links are supported by a
WTO trading system founded on rules established in the twentieth
century that do not account for all the modern changes in the global
economy.JamesBacchus,afounderoftheWTO,positsthatthisglobal
organizationcansurviveandcontinuetosucceedonlyifthetradelinks
amongWTOmembersarerevitalizedandreimagined.Heexplainshow
to bring the WTO into the twenty-first century, exploring the ways it
can be utilized to combat future pandemics and climate change and
advance sustainable development, all while continuing to foster free
trade. This book is among the first to explain comprehensively the
newtraderulesneededforournewworld.
james bacchus is Distinguished University Professor of Global
Affairs and Director of the Center for Global Economic and
Environmental Opportunity at the University of Central Florida.
WhileamemberoftheCongressoftheUnitedStates,hehelpedcreate
theWorldTradeOrganization.Hewasafoundingjudgeandthechief
judgefortheWTOduringitsfirstdecade.Amonghispreviousbooksis
The Willing World: Shaping and Sharing a Sustainable Global
Prosperity, published by Cambridge University Press in 2018 and
namedbytheFinancialTimesasoneofthe“BestBooksoftheYear.”

Trade Links
New Rules for a New World
JAMES BACCHUS
UniversityofCentralFlorida
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learning,andresearchatthehighestinternationallevelsofexcellence.
www.cambridge.org
Informationonthistitle:www.cambridge.org/9781009098106
doi:10.1017/9781009105941
©JamesBacchus2022
Thispublicationisincopyright.Subjecttostatutoryexception
andtotheprovisionsofrelevantcollectivelicensingagreements,
noreproductionofanypartmaytakeplacewithoutthewritten
permissionofCambridgeUniversityPress.
Firstpublished2022
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isbn9781009098106Hardback
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For my mother,
who taught me to read and took me to the Maitland Public Library.

Contents
Introduction: Fraying Links 1
1 Links to theGlobal Economy 16
GlobalizationintheNewPandemicWorld 16
TheContinuedNecessityofTradeLinksthroughtheWTO 27
LinkstoNatureandSustainableDevelopment 34
LinkstoaGreenRecovery 41
2 Links to thePandemic 52
AWorldTurningInward 52
TheEvolutionofGlobalSupplyChains 60
TheLinkbetweenTradeandHealth 67
TheCompositionofWorldMedicalTrade 68
TariffsonMedicinesandOtherMedicalGoods 71
PandemicExportRestrictionsonMedicalGoods 73
TheNewRulesNeededonTradeandHealth 75
TheAntidotetoVaccineNationalism 80
TheLinkbetweenTradeandFood 88
3 Links to thePre-pandemicWorld 94
TheExistentialCrisisoftheWTO 94
TheRiseofChinaandtheWTO 99
TheReturnofEconomicNationalism 107
4 Links to theTrade Inheritance 114
TheBasicRules 114
FoodandAgriculturalTrade 118
TradeinManufacturedGoods 125
TradeinServices 132
vii
viii Contents
5 Linksto the New Commercial Economy 137
RulesforDigitalTrade 137
RulesforIntellectualProperty 147
RulesforCompetition 159
RulesforFacilitatingInvestment 167
6 Linksto Climate Change 173
TheKaleidoscopeofSustainableDevelopment 173
ClimateChangeandaCarbonPrice 173
BorderCarbonAdjustments 182
BorderTaxAdjustments 186
TheCaseforaWTOClimateWaiver 187
TheContentofaWTOClimateWaiver 194
WhatIsaClimateResponseMeasure? 196
TradeandTransport 199
7 Linksto Sustainable Development 204
TradeandSustainableDevelopmentintheNewPandemicWorld 204
BiodiversityonOurImperiledPlanet 209
TradeinEnvironmentalGoodsandServices 214
FisheriesandFisheriesSubsidies 219
FossilFuelSubsidiesandSustainableEnergy 224
8 Linksto Ecologyand aCircular Economy 233
LinkstoEcology 233
AnimalLifeandWildlifeTrade 233
TheNexusofNaturalResources 239
LandUse,Water,andSustainableAgriculture 248
LinkstoaCircularEconomy 253
SustainableConsumptionandProduction 253
TradeSolutionstoPlasticsPollution 257
9 Linksto Cooperation, Equity, and Inclusion 263
LinkstoCooperation 263
LinkstoEquity 267
LinkstoInclusion 271
Conclusion: Lasting Links 288
Notes 293
Index 379
Introduction
Fraying Links
Nooneknowshowitstarted.Nooneknowspreciselywhenitstarted.Noone
knows for certain exactly where it started. What is known is that sometime in
late2019,thenovelcoronavirusthatcausesthediseasesincenamedCOVID-19
leapedfromananimal–maybeamonkeyorperhapsasmall,scaled,anteater-
like mammal called a pangolin – and possibly one of these animals or some
otheranimalthathadfirstbeeninfectedbyabat–into ahumaninthecityof
1
Wuhan in Hubei Province in central China. Wuhan is a major metropolis,
home to ten million people – three million more than New York City. The
deadly new virus spread rapidly throughout the city and the surrounding
province, without warning, without a vaccine, and without any cure. By late
January 2020, Wuhan had been quarantined in a lockdown by the Chinese
government.Bythen,atleast4,000people(officially)inWuhanhaddied,and
2
thevirushadreachedotherpartsofChina,whichwerelikewiselockeddown.
OnJanuary30,2020,theWorldHealthOrganizationdeclaredtheoutbreaka
“Public Health Emergency of International Concern.”3
ThearrivalofCOVID-19highlightedallthevariedlinksthatbindtheworld.
In centuries past, the viruses that carried plagues took years, even decades, to
travel from one part of the world to another.4 In today’s globalized world,
despite belated but extensive governmental efforts to contain the contagion in
China,thenewvirus“boardeda747”andquicklyspreadoverseas.5Thousands
soondiedinIranandinItaly,Spain,theUnitedKingdom,andothercountriesin
Europe.ThefirstcaseofthedeadlynewvirusintheUnitedStateswasreported
inWashingtonStateinlateJanuary2020.Withinweeks,COVID-19appeared
andsurgedinNewYorkCity,andAmericansbegantodieingrowingnumbers
aswell.ThenewdiseasespreadsteadilyelsewhereintheUnitedStates,atfirstin
themajormetropolitanareasandtheninthesmallercitiesandthecountryside.
Traveling invisibly and inexorably from China, from Europe, and from North
America,COVID-19soonbegantoarriveandthrivelethallyinthelessaffluent
1
2 Introduction: Fraying Links
developing countries of South Asia, Southeast Asia, Latin America, and sub-
Saharan Africa. On March 11, 2020, the World Health Organization charac-
6
terizedtheglobalhealthsituationasapandemic.
Astheglobalsearchbyscientistsforavaccineforthevirusbegan,deathtolls
from the shifting epicenters of the new virus rose daily. Within weeks, total
deaths from COVID-19 exceeded the annual death totals from influenza and
other common and seasonal viruses. Within months, they exceeded the total
number of deaths from recent wars and other global devastations. Counting
methods within countries and among countries have not been uniform.
Withoutquestion,thenumbersofinfectionsanddeathshavebeenunderstated.
In the United States alone, health officials think the true number of infections
from COVID-19 has been about ten times higher than the official count.7
ResearchersattheMassachusettsInstituteofTechnologyhaveconcludedthat,
for each reported infection, twelve infections have gone unrecorded, and that
for every two deaths from COVID-19, a third death has been attributed
8
mistakenlyto other causes.
With these qualifications, as of this writing, officially, worldwide, there have
beenabout248millioninfectionsandaboutfivemilliondeathsfromCOVID-19.9
ThelargestnumbersofinfectionsanddeathsintheworldhavebeenintheUnited
States, which has recorded more than 46 million infections and has suffered
748,643 deaths.10 With just 4 percent of the world’s population, the United
States has accounted for about 18 percent of all the world’s official infections
and about 15 percent of all the world’s official deaths from COVID-19. These
tragicnumbersrosedailyas2020turnedinto2021andthepandemicenteredand
continued through its second year.11 Almost 3,000 people were killed by the
terrorist attacks on September 11, 2001.12 On many days during the pandemic,
moreAmericansdiedfromCOVID-19thanwerekilledon9/11.
The pain of the pandemic came not only from the growing numbers of
infections and deaths. During 2019, in the absence of a vaccine, COVID-19
also took a rising economic toll amid the shock of a “global sudden stop.”13
Keeping people a safe distance of six feet or so apart – an epidemiological
concept soon known to everyone everywhere as “social distancing” – was,
14
scientists said, the best means available for slowing the spread of the virus.
Governmentsthroughouttheworldshutdowntheireconomiestosavelives.At
one point, more than four billion people were subject to some sort of stay-at-
15 16
homeorder. Socialdistancingdidsavelives. Butitdidsoataconsiderable
global economic cost. The livelihoods of those whose lives were saved and of
untold millions more were sacrificed, at least temporarily, to contain the
pandemic and to preserve public health. In some parts of the world, many
people were largely confined to their homes, unable to venture out for fear of
infection, and shornof many of their familyand community ties.
In the first months of the pandemic, and, in many places, for maddening
monthsafterward,grimevidenceoftheimpactofCOVID-19waseverywhere.
Borders were closed. Schools and universities were shut down. Factories were