Peace for the World

Peace for the World
First democratic leader of Justice the Godfather of the Sri Lankan Tamil Struggle: Honourable Samuel James Veluppillai Chelvanayakam

Sunday, February 26, 2017

Courage in the face of adversity

2017-02-27


Fortunately today, as a positive result following the recent rejection by President Maithripala Sirisena (in the much discussed National Human Rights Action Plan), LGBTIQ rights are strongly and openly discussed by the old and new generation of rights activists. Those who remained in their closets during those years have now started coming out strengthening the visibility of the LGBTIQ community.   


he ongoing discussion on LGBTIQ rights and issues is hugely welcome. In the recent past many LGBTIQ persons have come out of hiding and are lending their faces and names to a much taboo subject. I find this current trend extremely encouraging, being an activist since an era when such discussions were frowned upon in our country. This is important, as being visible as one’s own self is crucial in this fight for rights for the Sri Lankan lesbian, gay, bisexual, transgender, intersex and questioning (LGBTIQ) community.  When the fight for rights of the LGBTIQ community started, nearly two decades ago, through a collective of broadminded, visionary men and women with remarkable understanding, the greatest obstacle was the buried nature of the community. Fear of social stigma, criminalising, arrests, mistreatment made this minority a largely hidden one. Only a handful were brave enough to be visible in society to run this rights based struggle while many others left the country. Those who were fortunate to gain experience of the global LGBT movement shared their knowledge and activated the struggle for the rights of the LGBTIQ community in Sri Lanka as a key segment of its human rights struggles. As years passed by the conditions became shoddier. Times got worse during the previous regime when religious extremism was promoted and sponsored by the state itself. EQUAL GROUND, the only rights based LGBTIQ organisation in Sri Lanka, was trashed by law enforcement agencies on the instructions of leading characters of the Government at that time. From 2012 till 2014 EQUAL GROUND was under threat.  
The organisation and the Community Based Organizations it worked with in several districts became the target of the State Security Services. Our partners in Galle and Anuradhapura were raided by the CID and files and documents pertaining to EQUAL GROUND’s work in that area were taken in to custody. A team of us met with the OIC of the CID in charge of the so called investigation. It was scary when he told me exactly how I got to work, where I went and what I did. I had been under surveillance for almost a year! The crime committed was standing by the rights of a minority of the Sri Lankan population. So, there was a time in this country when openly working for rights of the LGBTIQ community was threatened by law enforcement agencies based on views of religious and racial extremists and aided and abetted by the then government. Just holding a community sensitizing workshop or celebrating PRIDE was looked upon as an act against the country. Unlike today, open discussions about LGBTIQ rights were not easy at that time. We still operate cautiously after this experience.   Fortunately today, as a positive result following the recent rejection by President Maithripala Sirisena (in the much discussed National Human Rights Action Plan), LGBTIQ rights are strongly and openly discussed by the old and new generations of rights activists. Those who remained in their closets during those years have now started coming out strengthening the visibility of the LGBTIQ community.   

"Met with the OIC of the CID in charge of the so called investigation. It was scary when he told me exactly how I got to work, where I went and what I did. I had been under surveillance for almost a year!  "

The LGBTIQ community was never limited to the elite of society. Lesbians, Gaymen, transgender men and women and those questioning their sexuality or gender identity are coming out in far rural areas as well as urban areas, seeking support to live as who and what they are. The continued advocacy over the years has created an environment where accepting one’s own sexual orientation and or gender identity is becoming easier. However, this is still a hard road for many. It certainly was no bed of roses for those who worked with EQUAL GROUND and stood by us rock solid during all those years. The political and social climate made our lives miserable. It must be this rough path that made us hang tough and stimulated us to form a thicker skin. Even during the time when the political environment was extremely threatening, when there was no option but to close our operations – we stayed open and worked, when all around us, organizations closed down and activists dived for cover. We reinforced our minds to face the wave and survive the storm. And we have survived.  
Analysing the work EQUAL GROUND has done over the years, it has become obvious that the pressure of lobbying locally as well as internationally is what paved the path. Influencing decision makers at international levels, urging governments to think globally and act locally is key and holds as much importance as collective efforts of local activists to campaign locally.
If both do not perform together, we will never achieve our targets. Supporting the logically planned international lobbying of other concerned parties is as important as implementing your own indigenous action plan. It is nothing but supporting the collective effort. As the world becomes smaller and more interconnected and interdependent, one cannot exclude seeking support from international players and decision makers. When a government fails to pay attention, be sensitive towards the rights of minority groups, an alternative pressure needs to be imposed through the support of the international community.   

"And one must not forget this is not the grand finale, either. As Winston Churchill once said ‘Success is not final, failure is not fatal: it is the courage to continue that counts"


To come this far EQUAL GROUND in its 12 years of existence, has had to convince international bodies such as the UN, The LGBTIQ Equality Coalition (a group of 29 governments dedicated to fighting for LGBTIQ rights) and gain their support. The opportunity received by the writer to co-chair the International lesbian, gay, bisexual, trans and intersex association (ILGA) created a conducive environment for proper rights based international lobbying. Currently EQUAL GROUND holds the Chair of the Commonwealth Equality Network – enabling us to partner with International activists and organisations to fight for each other’s rights within the Commonwealth.
Nowhere in the history of this world were rights achieved without a struggle. These were never just struggles that happened locally. International support, at least regional support, as a result of international lobbying by activists, had been a compulsory part and parcel of the total struggle. This is the practical use of knowledge. Success is where preparation and opportunity meet, as they say. And today, the preparations, made by old time rights activists who are dedicated, committed and have sacrificed themselves to fight for the rights of this community, are making an opportunity we should not miss. When the opportunity arises, one must not forget the process that prepared the path. And one must not forget this is not the grand finale, either. As Winston Churchill once said ‘Success is not final, failure is not fatal: it is the courage to continue that counts’.  


Shipping industry fails to reduce carbon emissions

Monday, 27 February 2017

logoIf the container shipping industry fails to proactively act on reducing carbon emissions, national and regional regulation will likely impose a heavy burden on shipping companies, an international working group looking at the issue of decarbonising shipping said. 

The group at the Danish Maritime Forum called for the establishment of an industry task force to come up with a plan to reduce the emissions in a unified and global context. As other sectors decarbonise, shipping’s share of global CO2 emissions will continue to increase. There is a clear risk of national or regional regulation if the industry does not act, said a report on the findings of the group.

One of the main concerns of the industry currently is the possibility of being subjected to national reduction targets if it does not deliver a strategy within the International Maritime Organisation, the report noted. This will undermine the global nature of shipping and will lead to competitive distortions and increased administrative burdens on companies.

Last year the IMO set 1 January 2020 as the implementation date for the reduction of marine fuel sulphur content from 3.5% currently to 0.5%. Several key industry groups welcomed the decision. However, there is a high degree of concern over how the target can be reached from a practical point of view and over its potential cost to shipping companies, particularly for operators of less efficient equipment and because of the scarcity and expense of low sulphur fuel. Low sulphur marine gasoline oil is around double the price of high sulphur residual fuel oil.

Neither the refining industry nor the shipping industry is likely to be prepared for a 2020 implementation date. (JOC)

Container leader woes tells a story

The largest container shipping line in the world Maersk Line’s turnover (including MCC Transport, Safmarine, Seago and SeaLand) contracted by 13% to $ 20.7 billion, whilst EBIT turned from a positive $ 1.43 billion in 2015 to a negative $ 396 million last year. Due to a tax refund, NOPAT (net operating profit/loss after tax, thus excluding interest payments) was a slightly better minus $ 376 million. Its quarterly result was somewhat better than in the same quarter of 2015, but deteriorated compared to 3Q2016.

On a corporate level, the A.P. Moller-Mearsk group did not perform well either, with a net loss of $ 2.35 billion, compared to a profit of $ 425 million the year earlier. The situation was particularly bad for Maersk Drilling (minus $ 649 million) and Maersk Supply Service (minus $ 1.23 billion), due to massive impairment losses. (DynaLiners)

Supreme Court blow to Port of Hamburg 

As referred to in DynaLiners, the German Supreme Federal Court has dealt a blow to the deepening of the River Elbe, giving access to the port of Hamburg, ruling that the project is partly unlawful and the plan has to be improved to better protect a rare plant species (Hemlock Water Dropwort). Although this may not be the end of the project, it will delay it by at least two years.

Global full container volumes up by 3.5%

In 2016, global full TEU volumes climbed by 3.5% year-on-year to 153.7 million TEU, according to (provisional) figures from Container Trades Statistics (CTS). Inter-continental trade rose by 2.9% to 101.7 million TEU, whilst intra-regional volumes grew by a higher 4.6% to 51.9 million TEU. Except for Sub Saharan African where numbers contracted by 1.2%, export container trades were higher for all corridors, with Australasia standing out with no less than 7.1% growth. Also the relatively small volumes from Middle East/Indian Sub-Continent and Latin American grew fast. Exports from the three main continents increased much less, with Europe the worst of the class. (DynaLiners)

Russia fines shipping lines

Russia has (initially) fined five carriers, CMA CGM, Evergreen, Hyundai, Maersk Line and OOCL, a combined RUB 1.5 billion ($ 22.5 million) for the co-
ordinated setting of freight rates on the Far East-St. Petersburg route in 2012 and 2013. However, after negotiations with the country’s Federal Anti-Monopoly Service (FAS), Maersk Line managed to reduce the initial $ 12 million to just $ 230,000. Other carriers are likely to be treated similarly, while FAS has reportedly promised to bring the Russian regulations up to international standards. (DynaLiners)

IN-4Asia-Europe spot rate continue to contract

The rate continues to slide despite reports that space on vessels is limited. Spot freight rates on the Asia-Europe trade continued to weaken as demand drops off and tight capacity management by container lines is unable to stop a slow but steady slide from January’s highs. The Shanghai-North Europe 
rate fell 6% this week to $ 858 per 20 foot equivalent unit, with the Asia-Mediterranean rate dropping 4% to $ 844 per 20 foot equivalent unit, according to the latest reading of the Shanghai Shipping Exchange SCFI. This is the seventh consecutive week the Shanghai-Europe rate has declined, falling from a high of $ 1,168 per TEU reached on Dec. 30. However, the year-over-year comparisons show the current spot rate to be two and a half times higher than the rate in the same week in 2016. (JOC)
Chinese exports surge

The port of Shanghai’s container throughput rose 12% in January year-over-year. Container shipping continued to enjoy stronger demand for ocean transportation in January, something that was clearly reflected in China’s robust export growth for January to its two largest trading partners, the United States and Europe. Exports to China’s biggest trading partner, the European Union, grew 13.6% in January compared with the same month in 2016 and exports to the United States rose 17.2%.

Overall exports in January were up 15.9% and imports grew 25.5% according to China Customs. A rush to get goods on the water before factories closed for Chinese New Year drove up the number of containerised exports in December and into January. China’s largest container port, Shanghai, experienced its throughput in January grow to 3.3 million twenty foot equivalent units, a 12% year-over-year increase. This growth in volumes leaving the mainland benefited ports on the other side of the world. (JOC)

Increase in idle container vessels

Compared to two weeks earlier, the 6 February idle fleet grew by 6 ships/26,000 TEU to 342 units/1,323,500 TEU or 6.5% of the global total. In the smallest category (<1 above="" and="" but="" by="" categories.="" declined="" five="" for="" growth="" in="" increases="" it="" just="" larger="" number="" of="" p="" segment="" size="" small="" strong="" teu="" the="" this="" undone="" vessels="" was="">

[The writer, a Maritime Economist, is a Chartered Fellow (Logistics Transport), Chartered Shipbroker (UK), Chartered Marketer (UK) and a University of Oxford Business Alumni. He is also a Fellow of NORAD/JICA and Harvard Business School (EEP).]

Palestinians urge boycott of Israeli military courts after freed prisoner rearrested


Freed Palestinian Barghouthi rearrested; military court reinstates original sentence of life plus 18 years

Iman Nafie, wife of Palestinian prisoner Nael Barghouthi, speaks during a news conference in Ramallah (AFP)

AFP-Sunday 26 February 2017
Palestinian officials on Sunday called for a boycott of Israeli military courts after a Palestinian freed in a 2011 prisoner exchange was rearrested and sent back to prison for life.
Speaking in the Israeli-occupied West Bank city of Ramallah, Palestinian Prisoners Club head Qadura Fares called on detainees' families and Palestinian organisations to stop taking part in military trials and to refuse to pay convicts' fines, which he said amounted to $6m in 2016.
Palestinians captured by Israeli security forces are generally brought before the army courts, where defence lawyers say they are often not notified of the charges against their clients or allowed to meet them before the trial.
"Palestinian movements and prisoners' families must choose boycott," Fares told a news conference.
"One must take the difficult decision of rebellion and boycott" of the courts, Issa Qaraqe, head of the Palestinian Authority's commission for detainees, added.
He noted that the same military court system on Tuesday sentenced an Israeli soldier to 18 months in prison for the manslaughter of a Palestinian he shot dead as the man lay wounded on the ground.
The United Nations said the sentence was an "unacceptable" punishment for "an apparent extra-judicial killing".
"Such courts must be boycotted," Qaraqe said on Sunday.
In contrast, he said, was the case of Palestinian Nael Barghouthi, sentenced to life imprisonment by Israel in 1978 for what the Israeli army said was "a series of security offences, including murder".
He was among more than 1,000 Palestinian prisoners freed by Israel in 2011 in exchange for the release of Gilad Shalit, an Israeli soldier captured five years earlier by Palestinian militants and held in the Gaza Strip.
"After his release, Barghouthi renewed his involvement in terrorist activity, violating his terms of release," the army told AFP on Sunday.
He was rearrested and on Wednesday a military court reinstated his original sentence of life plus 18 years.
According to a report by the Palestinian Authority and the Prisoners Club, 85 of the Palestinians freed in the 2011 swap have since been rearrested by Israel with 65 sent back to prison for life.

Israel refuses visa for Human Rights Watch, accusing group of 'Palestinian propaganda'

Human Rights Watch said the move was the step taken by Israel against NGOs which criticise its record on human rights.
CREDIT: EPA/ABED AL HASHLAMOUN
Israel has denied a visa to an investigator from Human Rights Watch (HRW), accusing the group of engaging “in politics in the service of Palestinian propaganda”.

Human rights groups expressed shock at the decision and said it was the latest in a series of steps taken by the Israeli government against NGOs which criticise its record on human rights.
Israel said the decision was not a blanket ban on HRW and insisted it had no broader plan to crack down on international human rights groups. 

HRW applied for an Israeli work visa in July for Omar Shakir, an Iraqi-born investigator who would be based in the area and cover both Israel and the Palestinian territories.

gaza
Most of HRW's work has focused on Israel but it has criticised Palestinian human rights abuses in Gaza and the West Bank CREDIT: UPI / BARCROFT IMAGES
Last week the group received a letter saying that Mr Shakir’s application had been denied at the recommendation of the Israeli foreign ministry.

“The opinion received from the Ministry of Foreign Affairs noted that, for some time now, this organisation’s public activities and reports have engaged in politics in the service of Palestinian propaganda, while falsely raising the banner of ‘human rights’, and therefore recommended denying the application,” the letter read.

“This decision and the spurious rationale should worry anyone concerned about Israel’s commitment to basic democratic values,” said Iain Levine, deputy executive director of program at Human Rights Watch.

“It is disappointing that the Israeli government seems unable or unwilling to distinguish between justified criticisms of its actions and hostile political propaganda.”  

gaza
Israel says it gets unfair criticism given the scale of human rights abuses in neighbouring countries CREDIT: AFP PHOTO / SAID KHATIBSAID KHATIB/
The group compared the decision to moves taken by Cuba, North Korea, Sudan, Uzbekistan, and Venezuela to prevent HRW from doing work in their countries.

HRW still has two part-time Palestinian assistants in Gaza and the occupied West Bank and both are able to continue their work. But they were no replacement for a full-time investigator, the group said.

“We are not happy with this group and that’s why were not giving a working visa towith this particular gentleman,” said Emmanuel Nahshon, a spokesman for the foreign ministry. “We are not talking about other human rights groups.”

Mr Nahshon said the flare-up might be a chance for the two sides to engage and better understand each other better.

HRW said its relationship with Israeli authorities had always been professional and respectful and its staff met regular with military and government officials. Last year Israel asked for HRW’s help in accessing citizens of its own who were victims of human rights abuses, the group said.

“They always treated us a legitimate actors so I don’t know where this is coming from,” said Sari Sari Bashi, the group’s Israel/Palestine advocacy director. 
Israel joins Cuba, North Korea and Sudan in blocking access to @hrw staff members. https://www.hrw.org/news/2017/02/24/israel-human-rights-watch-denied-work-permit 
Photo published for Israel: Human Rights Watch Denied Work Permit

Israel: Human Rights Watch Denied Work Permit

Israeli authorities denied Human Rights Watch’s application for a work permit for its Israel and Palestine director on the grounds that it is not a real human rights group, the organization said...
hrw.org
The group can appeal the decision and says its plans to do so.

Most of HRW’s work in the area has focused on the Israeli occupation of the West Bank and the blockade it maintains on Gaza, in conjunction with Egypt.

However, it has also written critically about the human rights records of the Palestinian Authority and of Hamas, leading to angry Palestinian criticism of the group.

A group of liberal Israeli NGOs put out a statement in support of HRW, saying: “A state that defines itself as democratic cannot turn its border control into a thought police.”

NGOs critical of the Israeli government’s human rights record have found themselves under pressure in Israel in recent years.

The government is considering a measure to ban Breaking the Silence, a group of former soldiers that speaks about the occupation, from speaking in state schools.

Last year, the parliament passed a controversial bill that places special reporting restrictions on NGOs that receive a majority of their funding from foreign governments. The overwhelming majority of groups affected are human rights organisations.

Israel argues that its human rights record is placed under unfair scrutiny, especially compared to neighbouring countries like Syria and Egypt, where governments carry out far more serious human rights abuses. 

Did Israel take Norwegian cadets to occupied Hebron?

The Israeli army is notorious for its oppression of Palestinians in Hebron. Mamoun WazwazAPA images
Ryan Rodrick Beiler-24 February 2017
Norway has sent naval cadets on a tour organized by the Israeli military.
A group of 13 from the Royal Norwegian Naval Academy visited the Middle East earlier this month.
Per Rostad, a spokesperson for the Norwegian navy, confirmed that the cadets’ visit took place in mid-February. However, he declined to comment on a press report suggesting that part of the trip was in Hebron, a city in the occupied West Bank.
Israel’s oppressive conduct in Hebron has been highlighted this week with the light sentence handed down to Elor Azarya, a soldier who shot dead an incapacitated Palestinian in the city last year.
Many other incidents in the area have received far less attention or gone unreported. Since the 1994 massacre by US-born settler Baruch Goldstein in the Ibrahimi mosque, Israel has imposed a regime of severe restrictions on Palestinians from Hebron’s Old City and its environs.
BDS Norway – a group supporting the Palestinian call for boycott, divestment and sanctions against Israel – has condemned the military visit.
“In the West Bank the Israeli army acts repressively and very aggressively,” Lars Gule, a spokesperson for BDS Norway, told the newspaper Vårt Land. “Is this what we want future Norwegian officers to learn?”

“Absurd”

“It is absurd that the Norwegian military can in any way defend going to Israel to draw on Israeli military expertise,” said Tora Systad Tyssen from the Association of Norwegian NGOs for Palestine.
“By developing new military cooperation with Israel Norway is legitimizing [the Israeli military’s] conduct,” she told The Electronic Intifada.
The delegation of cadets is only the latest exchange between Norwegian and Israeli military personnel.
Eli Bar-On, a colonel and legal adviser in the Israeli military, visited the Norwegian Defense University College in February 2016 to lecture military lawyers on the Israeli army’s process for investigating violations of military law.
At the time, Lars Morten Bjørkholt, head of the Norwegian Military Prosecution Authority, defended the visit by saying that the Israeli military legal system was “well-tested” and “transparent.”
However, following the Israeli military offensive in 2014 that killed more than 2,200 Palestinians in Gaza, the Israeli human rights group B’Tselem published a detailed analysis determining that the Israeli government was incapable of effectively investigating its own forces.
One week after Bar-On’s visit, the Association of Norwegian NGOs for Palestine called for the end of all military cooperation with Israel, noting that Norwegian soldiers have also participated in NATO exercises that included Israeli forces.
In addition to military contacts, Norway’s right-wing government has been pursuing closer ties with Israel in other policy domains.

Loopholes in weapons ban

In January, Børge Brende, the Norwegian foreign minister, signed an agreement with Benjamin Netanyahu, Israel’s prime minister. Its aim was to boost cooperation on scientific research.
In September last year, Norway’s petroleum and energy minister led a delegation to Israel to discuss collaboration with Israel’s oil and gas extraction industry, which has operations in the occupied West Bank and Golan Heights.
The student parliaments of two of Norway’s most prominent universities have recently passed resolutions calling for a boycott of such cooperation.
Just over a decade ago, Norway’s then finance minister Kristin Halvorsen, a member of the Socialist Left party, voiced support for a boycott of Israeli goods. However, this did not become the official policy of the government.
Several of Norway’s left-leaning parties continue to support some form of boycott and sanctions against Israel. And a number of local authorities have recently voted for boycotts of goods from Israel’s settlements in the West Bank.
National elections later this year may determine whether such initiatives will realign Norway’s policy toward Israel.
In the meantime, right-wing politicians are pressing for greater collaboration with Israel.
Jørund Rytman of the ultra-right Progress Party and leader of Israel’s Friends in Parliament recently told Vårt Land that “Israel has much to teach,” and has urged that Norwegian police should travel to Israel to discuss “terror questions.”
The Progress Party has also advocated lifting the ban on direct arms sales to Israel.
Norway officially bans direct weapons exports to Israel and other states engaged in armed conflict. Yet loopholes have allowed Nammo – a firm partly-owned by the Norwegian state – to continue supplying the Israeli military through its US-based subsidiary.

Sadiq Khan: nationalism can be as divisive as bigotry and racism

London’s mayor implies fresh Scottish referendum would be as destabilising as Brexit vote and Trump presidency

 Sadiq Khan will speak at Scottish Labour’s spring conference on Saturday. Photograph: Dinendra Haria/Rex/Shutterstock

 Scotland editor-Saturday 25 February 2017

Sadiq Khan, London’s mayor, has risked causing a row over Scottish independence by warning that nationalism can be as divisive as racism and religious bigotry.

Khan is expected to tell Scottish Labour’s spring conference on Saturday that there is no difference between nationalists trying to divide Scottish and English people and “those who try to divide us on the basis of our background, race or religion”.

Drawing on his experience fighting the London mayoral campaign when his Tory opponent, Zac Goldsmith, was accused of feeding anti-Muslim sentiment against him, Khan will imply a fresh Scotland independence referendum would be as destabilising as the Brexit vote and Donald Trump’s US presidential victory.

“The world is an increasingly divided place – with Brexit, the election of President Trump and the rise of populist and narrow nationalist parties around the world,” Khan is expected to say, in his first speech at a Scottish Labour conference.

“Now is not the time to fuel that division or to seek separation or isolation. Now is not the time to play on people’s fears or to pit one part of our country – or one section of our society – against another.”

An SNP spokesperson said: “Sadiq Khan is quite right to highlight the dangers of prejudice – but it is spectacularly ill-judged to compare supporters of Scottish independence to Trump or Brexiteers, and indeed it is an insult to many former and current Labour voters.

“It is only the SNP government which is providing principled and strong opposition to the Tories’ hard Brexit obsession, while Labour run up the white flag and allow themselves to be rolled over by the Brexiteers and their rightwing agenda.”

Scottish independence campaigners insist their brand of civic nationalism is inclusive and non-sectarian, and includes prominent English campaigners, as well as Asian and east European activists. They insist an independent Scotland would continue working closely with the rest of the UK.

Khan’s remarks threaten the alliance that he and Nicola Sturgeon, Scotland’s first minister, have forged to resist the UK’s withdrawal from the EU. Along with Northern Ireland, London and Scotland voted heavily against Brexit last June.

Khan and Sturgeon have met and spoken several times since. When Khan beat Goldsmith to win the mayoral contest, Sturgeon tweeted: “Good meeting with new London mayor @SadiqKhan earlier. Look forward to building constructive working relationship.”
Good meeting with new London mayor @SadiqKhan earlier. Look forward to building constructive working relationship
Khan is expected to resist claims he is accusing Scottish nationalism of being racist or sectarian. In extracts of his speech seen in advance he said he believed Scotland and London were both “beacons of progressive values”. Labour sources said Khan believed nationalism as a concept was divisive by definition because it stresses differences, implies superiority and erects barriers to other people.

In a direct attack on nationalists who portray London as Scotland’s opponent, he will tell delegates in Perth: “There are some in Scotland who try to define London as your enemy, who want to paint the city that I love as the home of ‘the elite’ or ‘the establishment’ – and who want the Scottish people to believe that London is a hotbed of conservatism.

“They make out that London is always working to undermine Scotland. I can tell you that nothing could be further from the truth. That is not my London and it’s not Labour’s London.”

He will argue that London and Scotland’s votes against Brexit showed they had much in common. “London and Scotland have always had a very special relationship. We’re both beacons of progressive values and hope within the United Kingdom.

“We celebrate our diversity and take pride in our tolerance. We strive for equality and to increase opportunities. And we fight tooth and nail for fairness and inclusion.”

Economists to Trump: It’s Not the Trade Deficit, Stupid

The U.S. president’s obsession with trade balances risks seriously skewing trade policy.
Economists to Trump: It’s Not the Trade Deficit, Stupid

No automatic alt text available.BY JESSICA HOLZER-FEBRUARY 22, 2017

Economists are increasingly alarmed at signs the Trump White House is using — and abusing — the U.S. trade deficit as a political tool to rally voters to his economic agenda, with potentially big implications for U.S. trade policy.

On the campaign trail, then-candidate Donald Trump bashed trade deals as unfair to American workers, often citing the U.S. trade deficit with China or Mexico as evidence Americans are getting outplayed at trade. He has vowed to restrict some imports in order to lower those negative trade balances, flummoxing many in the field.

“When economists hear, ‘Our goal is reduce the trade deficit,’ it baffles us,” Gordon Hanson, a trade economist at the University of California, San Diego, said. “He’s either using it as a cheap political ploy or there’s a misconception — he doesn’t understand how it operates.”

Now, White House officials are mulling a change to the calculation of the trade deficit that would make it grow, at least on paper, the Wall Street Journal reported. Under the change, “re-exports” — or goods that come into the United States and are immediately shipped out again — wouldn’t be counted as exports but would still be tallied on the import side of the ledger. Taken together, the move would swell the deficit.

Economists roundly derided the method as fuzzy math. It would “grossly and, I would say, unfairly inflate the deficit,” Gene Grossman, a trade economist at Princeton University, said.

The effort to try to create a bigger-looking trade deficit highlights the Trump administration’s laser focus on that number as a bellwether of economic strength, despite the protestations of mainstream economists. (Countries can run trade deficits or surpluses in good times or bad; they are a function of savings and investment rates more than of trade policy.)

And the new metric could provide fresh ammunition as the administration seeks to renegotiate or throw out existing trade pacts, mulls the imposition of border taxes or tariffs on imports, and generally walks away from the multilateral, free trade architecture that has underpinned global economic growth for decades.

Peter Navarro, the director of the White House National Trade Council, said in an email that the goal was “to improve our understanding of our large and chronic trade deficits so that American workers, manufacturers, and taxpayers are better served in the trade negotiation process.” He said there are “significant issues with the available data and methodologies” and said the White House would “get to the bottom of this analytical swamp.”

Many economists agree the methodology for tallying trade balances could use an update — though not at all like Trump officials are envisioning.

The calculation of a real trade balance doesn’t always capture the true value of the goods flowing back and forth, especially thanks to the growing complexity of global supply chains that weave in and out many countries. Often the final exporting country has only added a fraction of a good’s value yet gets assigned the product’s full value in the trade books.

Take the iPhone. It is imported from China, but many of its parts and intellectual property come from several countries, mainly the United States. So counting each one that enters the United States as a $200 import from China is misleading, economists say. What’s really being imported is the labor that went into the assembly of the smartphone. “It would be more informative to know how much value we are importing from China,” Grossman said.

Indeed, economists at the Organization for Economic Cooperation and Development (OECD) and the World Trade Organization have been trying to develop a so-called “value-added” methodology for tallying trade balances. It can make a big difference. In 2011, the most recent year with available value-added data, the United States ran a $275.1 billion trade deficit with China; under the value-added approach, that was cut to $178.7 billion. The contrast is starker in electronics. The 2011 U.S. trade deficit in that sector amounted to $136.3 billion; a “value-added” deficit was just $54.2 billion.

Getting a clear notion of what a trade deficit really measures — and how to best capture cross-border flows of goods and services — is crucial to avoiding poor trade policies, many economists say.

“If you want to have a better understanding of the economic impact and the economic footprint, you have to [have] a value-added perspective,” said Nadim Ahmad, who heads the trade and competitiveness division in the OECD statistics office.

Photo credit: JOE KLAMAR/AFP/Getty