Brazil Readies Tools To Combat Protectionism -Ambassador SAO PAULO (Dow Jones)--The Brazilian government is closely monitoring the growth of protectionism among key trading partners and will be ready with "the right tools" to combat it, if the need arises, the country's ambassador to the WTO said Tuesday. "There is the real threat of a wave of protectionism across the globe," Ambassador Roberto Azevedo told Dow Jones Newswires in a telephone interview from his office in Geneva. "We are monitoring it closely and we will be very attentive in the event someone breaks the rules." At a WTO meeting Monday, Brazil voiced its concerns over protectionism, receiving support from a number of other nations, including, China, India, South Africa, Mexico and Australia, said Azevedo. Since September, when the global crisis hit economic indicators across the globe, many industrialized countries have announced economic stimulus packages to avoid recession. But those packages are now causing protectionist concerns among emerging market trading partners. "These stimulus packages often act to distort economic conditions and hurt competition," said Azevedo. "Our task is to monitor events closely, measure whether there are violations of the rules and then be ready with the right tools to combat the problem." Azevedo did not detail the tools Brazil might use in combating protectionism. "You have to keep in mind that the crisis is only a few months old and powerful lobbies have already influenced these huge stimulus packages," he added. "The problem is that, if protectionism spreads, it will be difficult to reverse."

Brazil Criticizes Bailout Packages At WTO - Report 10 February 2009 AE Brazil- Financial and Corporate News Service São Paulo, 10 - Brazil declared on Monday in Geneva, Switzerland, that it may contest eventual trade distortions caused by bailout packages that have been announced around the world in recent months, reported Brazilian daily O Estado de S. Paulo on Tuesday. The warning came during the first meeting of the WTO to debate protectionist measures that have arisen amid the global economic crisis. In an unprecedented move, the WTO said it would closely monitor the impact of recent aid packages. Brazil alleges that import tariff increases by countries trying to protect their industry are not the main threat to global trade. According to Brazilian trade representatives, the worst effect comes from incentive packages for industry, which creates benefits for local companies and distortions in trade. Packages surpassing $3 trillion have already been launched by recession-stricken economies such as the U.S., Europe and Japan. The Brazilian government also hinted that these packages contain "disguised subsidies" that hurt competition in key sectors such as autos, agriculture and others. "An artificial incentive in one country may come as a hazard to a company in other country," said Roberto Azeredo, Brazil's ambassador to the WTO. (Jamil Chade, with editing by Sergio Caldas)

Growing Protectionism Poison, Not Remedy - Brazil Foreign Min 10 February 2009 AE Brazil- Financial and Corporate News Service Brasília, 10 - Brazil's Foreign Minister Celso Amorim on Tuesday said the expansion of protectionism "is not a remedy, but a poison." Amorim made the remarks at the end of a meeting with Senate speaker José Sarney, from the government-allied Democratic Party (PMDB). In line with Brazil's warnings to the WTO, Amorim said the "Buy American" clause in a massive stimulus plan could bring more problems than stimulus to the country's production. The minister made clear that, if necessary, Brazil could start a WTO dispute over this and other protectionist measures. Under the "Buy American" clause, the supply of machinery and inputs for public works in the U.S. would be restricted to U.S. suppliers. In Amorim's view, it is natural that governments try to protect their own countries at this moment of crisis. He warned, however, that they must be careful not to create problems for themselves in the process. (Denise Chrispim Marin)

Senate OKs huge economic stimulus; negotiators promise quick resolution in talks with House By ANDREW TAYLOR Associated Press Writer WASHINGTON (AP) - Senate passage of an $838 billion stimulus bill triggered an intense round of late-night bargaining on Tuesday, with the White House and key congressional Democrats seeking agreement on a final compromise aimed at combatting the worst economic crisis in decades. Democratic lawmakers said that in deference to Senate Republican moderates, it appeared the bill that eventually goes to President Barack Obama would be in the range of $800 billion -- less than the Senate measure or a different bill that cleared the House several days ago. "That's in the ball park," Senate Finance Committee Chairman Max Baucus, D-Mont., said of the $800 billion figure Tuesday night. Baucus had said earlier that $35.5 billion to provide a $15,000 homebuyer tax credit, approved in the Senate last week, would be cut back. There was also pressure to reduce a Senate-passed tax break for new car buyers, according to Democratic officials, while a $40 billion reduction in aid to states appeared likely to stick.

US steel companies press for Buy American plan WASHINGTON, Feb 10 (Reuters) - U.S. steel companies urged congressional leaders on Tuesday to maintain a strong "Buy American" provision as part of a final economic stimulus bill sent to President Barack Obama. The plea came as major U.S. exporters like Caterpillar and Microsoft pushed for either eliminating or substantially weakening the measure, which they say would raise the cost of public works projects funded by the stimulus bill and send a protectionist signal to the rest of the world. Canada, the European Union and other U.S. trading partners are also closely watching congressional negotiations on the Buy American plan, which would give preference to domestic steel companies and possibly other U.S. manufacturers.

India worried about huge bailout packages hurting poor nations. 11 February 2009 Financial Express As President Obama works to get a Congress clearance for his $800-billion bailout package for the US economy, India and a clutch of developing countries have expressed concerns about the massive stimulus deals being conjured up by the rich countries. India has called for a study of the impact of these packages in a WTO meeting on Monday. It also intends to highlight the distortions these packages could cause in global trade at the upcoming G-20 summit at London in April. "If the bailout packages of the rich countries are aimed at eliminating the toxic waste in their banks, then we don't mind. But if it results in H-1B workers from India losing jobs or exports becoming uncompetitive, then we will have to raise a red flag. We will have to wait and see how these bailout packages are worked out," commerce secretary GK Pillai told FE. The commerce ministry is holding a meeting this week to review India's safeguard duties and non-tariff measures to ensure that industry is not badly hit by the bailout packages and protectionist measures.

India 'open to talks' with China on toy ban 10 February 2009 AFP--India said Tuesday it was open to talks with China over New Delhi's decision to ban Chinese toy imports but added Beijing was welcome to challenge the move before the WTO, a report said Tuesday. "We are open to discussing the matter with China," Commerce and Industry Minister Kamal Nath said in the Indian capital, according to the United News of India news agency. Nath's comments came a day after China voiced "serious concern" over India's decision to impose a six-month ban on imports of toys, along with other measures, and said the moves threatened to strain trade relations. Nath said banning Chinese toys was fully compliant with WTO rules and that if China objected to the ban it could go to the WTO. The Indian government barred the import of Chinese toys from January 23, saying the move was taken on the grounds of public health and safety. China's toy industry has come under close scrutiny since millions of goods were recalled globally last year amid fears they were made with toxic lead paints or had design flaws. "Until the government of India is satisfied, the ban cannot be lifted," Nath said. India's toy industry, which employs two million people, has long protested about a flood of cheaper Chinese imports. Chinese products have grabbed 60 percent of India's toy market.

EU slaps 25 pct dumping duty on Chinese wire rods By Darren Ennis BRUSSELS, Feb 10 (Reuters) - The European Union has imposed temporary antidumping duties of up to 25 percent on imports of Chinese-made steel wire rods, but will not to put extra tariffs on other Chinese steel products, the EU's Official Journal said. Brussels has also imposed antidumping duties of around 4 percent on imports of steel rods -- mainly used in construction -- from Moldova, the journal said on Tuesday. ruction -- from Moldova, the journal said on Tuesday. The tariffs remain for six months until the European Commission, which oversees trade policy for the 27-nation bloc, decides whether to propose "definitive duties" for at least five years, which must then be approved by trade ministers. Trade disputes between Brussels and Beijing have risen since the EU's trade deficit with China has ballooned, hitting 160 billion euros ($206.3 billion). Last month the EU imposed duties of up to 87 percent on screws and bolts from China, triggering retaliatory action by Beijing at the WTO, the global trade watchdog. The Group of 20 emerging and developed countries have pledged to avoid using protectionist measures to fight the worst economic slowdown since World War Two. China says Brussels is protecting European companies amid the worst global economic slowdown in 80 years and EU antidumping decisions conflict with the pledge of the Group of 20 emerging and developed countries (G20) to avoid using protectionist measures to fight the financial crisis.

China welcomes EU decision to end anti-dumping probe against zinc plates BEIJING, Feb. 10 (Xinhua) -- China welcomed the European Union's decision to terminate an anti-dumping investigation against Chinese zinc coating plates, the Ministry of Commerce (MOC) said in an online statement Tuesday. The EU decision was announced on Saturday. The anti-dumping investigation started in December, 2007. The case covered nearly 200 Chinese producers and products worth 1.206 billion U.S. dollars, making it the largest anti-dumping case EU against Chinese products since 1979. The EU has launched seven anti-dumping investigations on Chinese-made steel products since September 2007, including carbon steel fasteners, zinc coating plates and cold rolled stainless steel sheets. China hoped the EU would maintain its objective and fair stance when dealing with the other cases and make a decision according to WTO, MOC spokesman Yao Jian said.

Brazil's Trade Ministry Sees No Signs Of Chinese Dumping RIO DE JANEIRO (Dow Jones)--Brazil's Ministry for Development, Industry and Trade has not noted any signs of dumping from China or any other country, a spokesman told Dow Jones Tuesday. Brazil's steel sector has recently criticized the purchase of Asian steel products by local companies and lobbied the Brazilian government for support. "However, although we haven't seen anything yet, we are vigilant," the spokesman said. Asked specifically about the possible dumping of steel products, the subject of a complaint by Brazilian flat-steel maker, Usiminas, the spokesman said his comments were generic, applying to all types of goods.

Brazil to offer $1 bln in repos for trade lines SAO PAULO, Feb 10 (Reuters) - Brazil's central bank said on Tuesday it will offer up to $1 billion in dollar repurchase agreements in an auction on Wednesday aimed at increasing trade finance lines squeezed by the global credit crunch. Brazil's currency, the real, was trading 0.6 percent weaker at 2.251 per dollar shortly after the announcement of the repo auction. Selling repos is one of several measures Brazil's central bank has taken to add liquidity to the domestic financial system in recent months. It has also sold dollars from its international reserves on the spot currency market as well as foreign currency swaps.

Dutch govt in patent row, seeks clarity on EU rules 11 February 2009 The Economic Times NEW DELHI: The Dutch government has asked the European Commission (EU) for a review of the EU Customs regulations, based on which a consignment of high blood pressure drugs from India being exported to Brazil, was seized and sent back, while transiting through the Dutch ports. It had been challenged by Merck Dupont which claimed that the medicine was being imported despite the company having a patent on it. Visiting Dutch minister of foreign trade Frank Heemskerk has said his country wanted to "avoid" such incidents in future and had written to the European Commission seeking clarity on how the EU Customs regulations could be brought in sync with the international Trips regulations which gave concessions to poor countries on the ground of public health. "My country is very much in favour of providing generic medicines, especially to the very poor," Mr Heemskerk said in an interview to ET.

China Exports Fall by Most in 13 Years, Imports Drop by Record By Kevin Hamlin Feb. 11 (Bloomberg) -- China’s exports fell by the most in almost 13 years as demand dried up in the U.S. and Europe and imports plunged by a record, signaling a deepening slump in the world’s third-biggest economy. Outbound shipments declined 17.5 percent in January from a year earlier and imports fell 43.1 percent, the customs bureau said on its Web site today. Both numbers were worse than economists’ forecasts. The $39.11 billion trade surplus, the nation’s second biggest on record, may add to tensions as global leaders seek to avoid a trade war amid the worst financial crisis since World War II. China’s economic slowdown has already cost the jobs of 20 million migrant workers and growth may slide to 6.1 percent this quarter, the least since 1999, according to a Bloomberg News survey of 10 economists.

U.S. Trade Deficit Probably Narrowed to Smallest Since 2002 By Shobhana Chandra Feb. 11 (Bloomberg) -- The U.S. trade deficit likely shrank in December to the smallest in more than six years as the recession pushed oil and consumer spending lower, reducing imports, economists said before a government report today. The gap between imports and exports narrowed to $35.7 billion, the lowest level since October 2002, from $40.4 billion in November, according to the median forecast of 70 economists surveyed by Bloomberg News. (END)

WORLD TRADE NEWS
NEWS SUMMARY FOR WTO REFERENCE CENTRES AND NON-RESIDENT MISSIONS
11 February 2009
No. 1884

Source: www.wtocenter.org.tw