• World
    South China Morning Post

    Hong Kong warned WTO challenge to potential US trade sanctions could be 'counterproductive'

    In a statement released late on Thursday, hours after China's National People's Congress approved the proposal for the controversial legislation, the Hong Kong government said that as a full member of the World Trade Organisation (WTO), "we expect to be fairly treated by our trading partners".Should the US revoke Hong Kong's special trading status, the special administrative region could be subjected to the same trade war tariffs imposed on Chinese exports to the US, or even unilateral tariffs against Hong Kong specifically, as well as export controls and potentially greater scrutiny of its financial and payments landscapes, experts said.In the case of tariffs, analysts said it is "factually possible and legally correct" that Hong Kong could bring a WTO case against the US, given that it retains its own WTO membership and should be treated on a "most-favoured nation" basis, which punitive tariffs would violate.But analysts believe any such future action would be "counterproductive", since even if Hong Kong was to win a case, it could be permitted to introduce retaliatory tariffs on the US, which would harm Hong Kong's economy and image as a beacon of free trade.Furthermore, it is unlikely that a WTO case, which would take years to process, would resonate in a White House which is openly scornful of the Geneva-based trade body."Hong Kong is really limited in what it can do. Taking a WTO case would be symbolic, and even if Hong Kong prevails, the damages would be very low. So if Hong Kong decides to put tariffs on the US " which would be a first " what does it target? Consumer products or food? What kind of message does that send about Hong Kong? Who is that really hurting?" said Bryan Mercurio, a professor covering the WTO at the Chinese University of Hong Kong.Hong Kong is a free port, with zero tariffs on goods shipped in and out, however, it has very little direct trade of its own. As a entrepot for trade with China, the vast majority of goods passing through are re-exported to and from the mainland.While Hong Kong was the world's sixth largest exporter in 2018, according to WTO statistics, just US$13 billion of its US$556 billion in shipments were domestic exports. For imports, just US$155 billion of US$628 billion were consumed domestically."Removing from US law the commitment to Hong Kong's non-discriminatory trade treatment would make it easier for the US Trade Representative to defend unilaterally slapping tariffs on the city's exports. This would most likely violate WTO rules, but this has not deterred the US from placing tariffs on imports from the mainland," read a Capital Economics research note."If this happened, shipments to the US would suffer. Gross exports from Hong Kong to the US are worth 13 per cent of [gross domestic product]. But the vast majority of products are being reshipped through the city. US-bound goods exports, generate under 3 per cent of [gross domestic product], mainly in logistics and postal services rather than manufacturing."Hong Kong has been a member of the WTO since January 1995, but it has only brought a single case " a complaint against the Turkish garment trade in 1996 that was "largely a matter of principle" rather than economic wrongdoing, said Julien Chaisse, a trade professor at the City University of Hong Kong.However, Chaisse said that Hong Kong could learn from another historical precedent of a smaller WTO member successfully bringing a case against a more powerful member, but eventually being left dissatisfied with the spoils of victory.In 2003, tiny Antigua and Barbuda accused the US of discrimination after it was frozen out of the world's largest gambling market after the Caribbean nation had built up a giant online betting market designed to replace its struggling tourism sector.WTO judges eventually ruled in its favour, awarding compensation of US$21 million per year, but the US refused to pay. Antigua and Barbuda therefore had the right to impose tariffs on the US, but declined to do so, thinking that it would be an act of economic self-harm."Why would a place like Hong Kong or Antigua impose tariffs on the US?" Chaisse added. "Who would hurt from such action, apart from the domestic middle class?"Chaisse added that should the national security law lead to an erosion in the "one country, two systems" model under which city is supposed to be governed until 2047, Hong Kong could also find itself on the receiving end of investor disputes and trade lawsuits, especially if the goalposts are moved for investors in the city.Hong Kong has 20 bilateral investment treaties, more than half of which were signed with developed nations in the run up to the handover from Britain to China in 1997, a means of assuaging fears of changing business conditions."I would not exclude the possibility of, in the future, investors from these places using investment protection courts to sue Hong Kong," Chaisse said.This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2020 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2020. South China Morning Post Publishers Ltd. All rights reserved.

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  • U.S.
    MarketWatch

    ‘This…Is Why’ — LeBron James, Jamie Foxx react to George Floyd’s death with images of Colin Kaepernick kneeling

    The four officers involved in the death of George Floyd were fired on Tuesday, including Derek Chauvin, who was filmed with his knee on Floyd's neck. Chauvin was arrested on Friday. While thousands of protesters clashed with police on Tuesday evening, many others horrified by the video of Floyd pleading “I can't breathe” voiced their frustration on social media, with Floyd and Chauvin's names, “I can't breathe” and “Black Lives Matter” trending on Twitter (TWTR) throughout the day.

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  • World
    The Telegraph

    Airlines schedule major increase in flights in July as pressure mounts on ministers to ease quarantine

    Airlines have scheduled a dramatic increase in flights in July in anticipation that Governments will lift travel restrictions for holidaymakers and save the industry from potential collapse, according to data seen by The Sunday Telegraph. The companies which have already laid off tens of thousands of workers are banking on a “V-shaped” recovery by scheduling 161,200 passenger flights and 29.5 million seats for July, just eight per cent down on last year’s July timetables. The strategy to open up business travel and holiday routes to hotspot favourites like Greece, Italy, France and Spain comes as most European countries are preparing to lift their quarantines or open their borders in mid June or at least by July 1. It will increase pressure on Boris Johnson to make good his suggestion last week that the UK’s quarantine - to be introduced on June 8 - could be replaced with “air bridges” to low-risk holiday destinations when it is reviewed on June 29. One senior industry source claimed: “The sense is that they might quietly do a U-turn after the first review period. Grant Shapps [the Transport Secretary] is against quarantine, the Treasury are against it, Beis is against it and DCMS hate it.” The exclusive data, from Cirium, a travel analytics firm, shows how the coronavirus pandemic devastated the aviation industry as it tore across the world. Scheduled passengers were 22.5 million in February, 10 per cent up on last year before it slumped by 93 per cent in April and May. It has risen in June to 38.5 per cent down on last year, as the Far East has opened up, and rises to just minus eight per cent in July as airlines anticipate Europe unlocking. June and July are “scheduled” rather than actual flights, which will depend on quarantines easing in June and July. Germany has lifted restrictions, Italy wants to resume travel on June 15, and Spain and Portugal are aiming for July 1. France hopes to drop border controls to and from EU countries after June 15 except with countries that impose quarantine on a “reciprocal” basis, namely the UK. Greece has excluded the UK from a “white list” of 29 countries it judges are low-risk enough from which to accept tourists from June 15 without quarantine although it will open up to more countries after it reviews their infection rates at the end of June. British Airways says it is aiming for a “meaningful return” to flying in July, RyanAir plans to ramp up flights to at least 40 per cent of its normal July schedule and EasyJet, which has laid off one in three staff, hopes to operate 30 per cent of its pre-crisis timetable from July to September. Paul Charles, chief executive of PC Consultancy, which advises the tourist industry, said Britain’s quarantine risked “killing” the economy. “Travel companies have not had any bookings for April or May. They are worried that if they don’t get them in June, they will go under,” he said. The Airport Operators’ Association (AOA) has urged ministers to aim for the first “air bridges” to “low risk” destinations by June 8 so that holidaymakers can sidestep quarantine and the requirement to self-isolate for 14 days on their return to the UK. The Department for Transport will shortly publish new guidelines for “safe” travel which will include face coverings or masks throughout the journey, temperature checks, social distancing in airports and contactless travel including for check-ins and payments. An AOA spokesman said: “Once these guidelines are agreed and given that they are based on a common European baseline, this puts in place the right conditions for opening up air bridges to low-risk countries.” The Home Office which has led the moves to introduce quarantine has, however, warned that it will block attempts to lift the quarantine unless it is safe and there is no risk of it sparking a second wave of coronavirus. A Department for Transport source said: “There is certainly a willingness in Government to do as much for this Summer as is safe.” Post-coronavirus air travel: No travel if you have symptoms If ill, no cost re-booking or refunds up to six hours before flying Face masks or coverings from arrival at airport to leaving terminal at destination Only passengers in the terminal, no tearful goodbyes at departure gates Contact-less electronic check-in and boarding Social distancing and one-way systems for waiting and queuing passengers Airports' association pressing for temperature checks Exemption from two-metre rule on plane No on-board duty free, reduced food and drink service, pre-packaged food and cashless payments

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  • U.S.
    The Guardian

    Trudeau: Canadians watching US unrest and police violence in ‘shock and horror’

    Prime minister condemned racism and called on Canada to ‘stand together in solidarity’ against racial hate as protests continue in US * George Floyd killing – follow live updatesCanadians are watching unrest and police violence in the United States in “shock and horror”, Justin Trudeau said on Friday – but the prime minister cautioned that his country also has entrenched problems with racism. The city of Minneapolis has been rocked by a third night of violent protests over the death of George Floyd, an unarmed black man, after a white police officer knelt on his neck as he lay on the ground following arrest. “Many Canadians of diverse backgrounds are watching, like all Canadians are, the news out of the United States with shock and with horror,” Trudeau told reporters at a daily briefing.“Anti-black racism – racism – is real. It’s in the United States but it’s also in Canada and we know people are facing systemic discrimination, unconscious bias and anti-black racism every single day,” said Trudeau, calling on the country to “stand together in solidarity” against racial hate. “We have work to do as well in Canada.” Racial inequities continue to persist throughout the country – a grim reality that is often apparent during interactions with police. In December 2018, the province of Ontario released a landmark report that found black residents in Toronto – the country’s largest city – are 20 times more likely to be shot dead by the police than white residents. “It’s a very Canadian tradition to speak in platitudes, to refer to the underground railroad and to speak about Canada as a haven and a place that acknowledges its past mistakes,” said Robyn Maynard, author of Policing Black Lives. “But we continue to see similar structural harms and structural kinds of violence as we do in places where leaders make more overtly vitriolic statements towards black communities.”Last month, 26-year-old D’Andre Campbell was shot dead by police inside his own home, north of Toronto, after Campbell himself called 911.Earlier this week, the family of Regis Korchinski-Paquet said a police officer shoved the young woman over the balcony of the family’s 24th-floor apartment, where she fell to her death. The case is currently under investigation by an arms-length police watchdog.Maynard also pointed out the coronavirus pandemic continues to have a disproportionate impact on black and indigenous residents, who are overrepresented in the country’s prison population.“We continue to see prisons and jails being epicentres of outbreaks,” she said. “Yet there is failure on the part of the federal government to meaningfully release to release prisoners.”Trudeau’s unprompted remarks marked a notable departure for a leader who has gone to great lengths to avoid irritating his US counterpart, Donald Trump.Canadian prime ministers have traditionally refrained from discussing political and social turmoil in the US – Canada’s main ally and largest trading partner. Justin Trudeau has long spoken about the need to tackle racism, but his re-election campaign was marred by pictures of him in blackface as a young man.

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