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Despite Truce, No End in Sight for the US-China Trade War

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USA China Trade War

As the trade war between the US and China moves into truce, but not yet comprehensive agreement, uncertainly still rules, agreed panellists at a CNBC debate on the first day of the World Economic Forum’s Annual Meeting of the New Champions.

“The implication of the trade war is going to be so much broader than whatever impact it may have on business in the US and China,” said Charles Li, Chief Executive of Hong Kong Exchanges and Clearing. “This will be a long, long process before it’s over.”

Li compared the trade war to two runners, with the second runner closing distance in a manner that the race leader thinks is unfair. “Either you run faster to create the distance again, or you find a way to slow the other runner down.”

For the time being, there is no immediate end to the race in sight. None of the panellists predicted that there would be a resolution between the US and China on trade by the end of the year.

“The business community is very pleased that they are going back to the negotiating table … and that additional tariffs are going to be postponed for the time being,” said Timothy P. Stratford, Managing Partner, Beijing, at Covington & Burling. “What we are most concerned about is all the remaining uncertainty.”

“National security and trade policy are different fields,” he added, “with different rationales and goals they are trying to achieve.” He warned: “Mixing them together can really complicate things. They both need to be addressed in parallel, because they impact each other, but you have to keep them separate.”

“It’s a temporary truce,” reminded Mari Elka Pangestu, Professor of International Economics at the University of Indonesia, “but the issues behind the trade tariffs and deficit go deeper, into the perception of unfair trade practices, intellectual property and technology. I’m not sure it can be resolved anytime soon.”

Pangestu stressed the need for a multilateral rather than a bilateral resolution, so that all stakeholders can participate. “When two elephants fight,” she said, “countries like Indonesia don’t want to be trampled; we need to be agile.”

China’s loss can also be South-East Asia’s and ASEAN’s gain, as US firms seek alternative supply chains and manufacturing bases. But these could only be short-term gains, Pangestu warned, emphasizing that, for Indonesia in the long term, “it’s better that we go back to a rules-based system and more certainty.”

“We are very happy to hear that both the US and China have agreed to come back to the negotiating table,” said Yi Xiaozhun, Deputy Director-General of the World Trade Organization. However, he voiced the hope that multilateral arbitrage can help the US and China to resolve their differences.

“The WTO is a rules-based organization,” Yi stressed. “If some members feel their business opportunities are jeopardized by other members, they should come to the WTO to raise their concerns.”

“A lot of smaller economies are also affected by this trade war,” added Yi. “The current economic situation in the world does not look good. Uncertainty has reduced the confidence of investment, and global supply chains are disrupted. We hope that uncertainty can be reduced … and the WTO can move forward to more liberalization rather than moving back to managing trade.”

“Uncertainty is causing a lot of delay in investment decisions,” concurred Pangestu. “At the end of the day, it’s consumers who have to pay.”

Repercussions run deeper than rising prices. “Americans are concerned that the Chinese government will find other ways to show its displeasure,” warned Stratford, citing different types of retaliation including audits, investigations and the inability to get business licences.

Stratford noted: “One possibility is that the Government of China might decide it would be easier to deal with another president, and wants to see the results of the [2020] election. Although I agree that, whether you have a Republican or a Democrat in the White House, the US will never go back to what their China policy was before.”

“Both sides are suffering pain,” Stratford said, and seek a solution. But the resolution will not come easily or swiftly. “We’re moving into a process that might take three or four years.”

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Environment

Greenpeace Africa reacts to DRC President’s decision to suspend illegal logging concessions

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The President of the Democratic Republic of Congo (DRC), Félix Tshisekedi, ordered on Friday, October 15th, the suspension of all dubious logging concessions, including the 6 granted in September 2020. Greenpeace Africa, one of the civil society organizations that denounced these concessions, applauds the decision taken by the Head of State and encourages him to remain vigilant and ensure its effective execution by Deputy Prime Minister Ms. Eve Bazaiba.

Greenpeace Africa reiterates its call for maintaining the moratorium on new industrial logging concessions to prevent a human rights and climate catastrophe. This logging sector, characterized by bad governance, favors corruption and remains out of touch with the socio-economic needs of the Congolese people and the climate crisis we live in.

Irène Wabiwa Betoko, Head of the International Congo Basin Forest Project of Greenpeace: “The decision of H.E. President Tshisekedi against the illegal actions of former Minister Nyamugabo sends an important message to the Congolese people and their government. It is also a red light for the plans of Ms. Ève Bazaiba, current Minister of the Environment, to open a highway to deforestation by multinational logging companies through lifting the moratorium on new industrial concessions.”

The President asks to “Suspend all questionable contracts pending the outcome of an audit and report them to the government at the next cabinet meeting.” Greenpeace Africa maintains that the review of illegalities in the forest sector must be transparent, independent, and open to comments from civil society organizations.

Ms. Wabiwa adds that “Both the protection of the rights of Congolese peoples and the success of COP26 require that the moratorium on granting new forest titles be strengthened. We again call on President Tshisekedi to strengthen the 2005 presidential decree to extend the moratorium.”

Ms. Wabiwa concludes that “instead of allowing new avenues of destruction, the DRC needs a permanent forest protection plan, taking into account the management by the local and indigenous populations who live there and depend on them for their survival.”

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Tech News

Standards & Digital Transformation – Good Governance in a Digital Age

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In celebration of World Standards Day 2021, celebrated on 14 October every year, the United Nations Industrial Development Organization (UNIDO) is pleased to announce the launch of a brochure, “Standards and Digital Transformation: Good Governance in the Digital Age”.

In the spirit of this year’s World Standards Day theme “Shared Vision for a Better World”, the brochure provides insights into the key drivers of the digital transformation and its implications for sustainable development, particularly people, prosperity and planet. Noting the rapid pace of change of the digital transformation, with the COVID-19 pandemic serving as an unanticipated accelerator, the brochure highlights the role of standards in digital transformation governance. It further considers the principles necessary for guiding the collaborative development of standards in the digital technology landscape to ensure that the technologies remain human-centered and aligned to the goals of sustainability.

This year’s World Standards Day theme highlights the Sustainable Development Goals (SDGs) representing a shared vision for peace and prosperity, for people and planet. Every SDG is a call for action, but we can only get there if we work together, and international standards offer practical solutions we can all stand behind.

This brochure is a summary of a publication set to be released in November 2021.

Download it here.

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Human Rights

UN: Paraguay violated indigenous rights

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An indigenous community in Paraguay wait to receive their COVID-19 vaccination. WHO/PAHO

Paraguay’s failure to prevent the toxic contamination of indigenous people’s traditional lands by commercial farming violates their rights and their sense of “home”, the UN Human Rights Committee said in a landmark ruling on Wednesday. 

The Committee, which is made up of 18 independent experts from across the world, monitors countries’ adherence to the International Covenant on Civil and Political Rights.  

Lands represent ‘home’ 

The decision on Paraguay (in Spanish) marked the first time it has affirmed that for indigenous people, “home” should be understood in the context of their special relationship with their territories, including their livestock, crops and way of life.  

“For indigenous peoples, their lands represent their home, culture and community. Serious environmental damages have severe impacts on indigenous people’s family life, tradition, identity and even lead to the disappearance of their community. It dramatically harms the existence of the culture of the group as a whole,” said Committee member Hélène Tigroudja. 

The decision stems from a complaint filed more than a decade ago on behalf of some 201 Ava Guarani people of the Campo Agua’e indigenous community, located in Curuguaty district in eastern Paraguay. 

The area where they live is surrounded by large commercial farms which produce genetically modified soybeans through fumigation, a process which involves the use of banned pesticides. 

Traditional life affected 

Fumigation occurred continuously for more than 10 years and affected the indigenous community’s whole way of life, including killing livestock, contaminating waterways and harming people’s health. 

The damage also had severe intangible repercussions, according to the UN committee.  The disappearance of natural resources needed for hunting, fishing and foraging resulted in the loss of traditional knowledge.  For example, ceremonial baptisms no longer take place as necessary materials no longer exist. 

“By halting such ceremonies, children are denied a rite crucial to strengthening their cultural identity,” the Committee said.  “Most alarmingly, the indigenous community structure is being eroded and disintegrated as families are forced to leave their land.” 

Toxic exposure 

The indigenous community brought the case to the Human Rights Committee after a lengthy and unsatisfactory administrative and judicial process in Paraguay’s courts. 

“More than 12 years after the victims filed their criminal complaint regarding the fumigation with toxic agrochemicals, to which they have continued to be exposed throughout this period, the investigations have not progressed in any meaningful way and the State party has not justified the delay,” the Committee said in its decision. 

Recommendations, reparations 

Members found Paraguay did not adequately monitor the fumigation and failed to prevent contamination, adding “this failure in its duty to provide protection made it possible for the large-scale, illegal fumigation to continue for many years, destroying all components of the indigenous people’s family life and home.”  

The Committee recommended that Paraguay complete the criminal and administrative proceedings against all parties responsible and make full reparation to the victims. 

The authorities are also urged to take all necessary measures, in close consultation with the indigenous community, to repair the environmental damage, and to work to prevent similar violations from occurring in the future. 

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