ESADEgeo Daily Digest, 05/10/2018

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Euractiv – Reuters / US says it cannot support some of EU’s ideas for WTO reform

  • The US has rejected EU ideas for reforming the World Trade Organization’s Appellate Body, effectively the supreme court of world trade, by giving the judges longer, single terms and giving the secretariat more funding.
  • “Our view is that that means less accountability for the Appellate Body. We cannot support something that makes the Appellate Body less accountable,” US Ambassador Dennis Shea said.
  • EU Ambassador Marc Vanheukelen rejected the US view that the EU proposal would make the judges less accountable and said it was impossible to expect them to cope without more resources.
  • US President Donald Trump has taken the Appellate Body to the brink of collapse by blocking the appointment of judges. Normally the WTO has seven judges but it now has only three, the minimum to hear dispute cases.

Al-Monitor – Bijan Khajehpour / Will EU’s ‘SPV’ be able to sustain Iran trade, investment?

  • EU foreign policy chief Federica Mogherini announced that the EU would create a “special purpose vehicle” (SPV) to sustain Iran-EU trade despite the reimposition of US secondary sanctions.
  • The SPV seems to be designed to devise a structure that will minimize the financial flows through a triangular barter structure. In practice, the SPV would act as a financial and commercial intermediary for exports and imports between the EU and Iran and will be open to other nations that are trading with Iran.
  • The key challenge will be to protect the SPV as well as all those European companies and banks that will directly trade with Iran via the mechanism. This may happen through legal action against US interests in the EU or through international institutions such as the World Trade Organization.
  • While the SPV has the potential to sustain trade, other steps will be needed from both sides to facilitate the transfer of technology and actual investments as opposed to pure trade. The SPV could act as a facilitator in preparing European SMEs for joint ventures and the needed legal, technological and operational processes to assure win-win scenarios for all parties.

The Atlantic – Joshua A. Geltzer / Trump’s counterterrorism strategy is a relief

  • The US government has released its first overarching public counterterrorism strategy since President Obama’s in 2011. The document largely reflects the views of counterterrorism professionals, who have maintained their focus, despite President Trump’s rhetoric.
  • Most notable about the document is one key inclusion—a continuing emphasis on foreign partnerships—and a whole set of exclusions, such as Trump’s travel ban and his promise to erect a wall on the US-Mexico border.
  • Indeed, what the strategy calls a “new approach” is hardly new at all. The US success in reducing the Islamic State’s territorial control to 1 percent of what it once held speaks to the success of partner-based approaches to counterterrorism. It’s to the Trump administration’s credit that it’s now embracing that approach.
  • As always, there are points with which to quibble in the document. The biggest evolution in the terrorist threat since 2011 is the rise of social media as a tool terrorists use. Trump’s new strategy acknowledges that problem but says very little about how to solve it.

Project Syndicate – Joseph S. Nye / China, Japan, and Trump’s America

  • While the recent announcement of bilateral talks postpones Trump’s threat of auto tariffs against Japan, critics worry that Trump may be pushing Japan closer to China.
  • But that is unlikely at this stage. While such options may be explored, they will remain limited, given Japanese concerns about Chinese domination. The US alliance remains the best option – unless Trump goes much further.
  • Thus far, and despite legitimate concerns, the alliance remains remarkably strong. North Korea helped focus the alliance’s attention and provided an opportunity for Trump to assure Japan that the US was behind Japan “100%.”
  • As the Clinton administration recognized a quarter-century ago, China’s rise created a three-country balance of power in East Asia. If the US and Japan maintain their alliance, they can shape the environment that China faces and help moderate its rising power.

The selected pieces do not necessarily reflect the views of Javier Solana and ESADEgeo. The summaries above may include word-for-word excerpts from their respective pieces. 

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