This panel was convened at 9:00 am, Friday, April 5, by its moderator, Clay Lowery of Rock Creek Global Advisors, who introduced the panelists: William Burke-White of the University of Pennsylvania Law School; Gisela Bolivar of Jimenez Romero y Asociados; and Sonia E. Rolland of Northeastern University School of Law. *
* Professor Burke-White and Mr. Zhan did not contribute remarks to the Proceedings.
THE INFLUENCE OF EMERGING ECONOMIES ON THE ARCHITECTURE OF INTERNATIONAL ECONOMIC LAW: A PERSPECTIVE FROM MEXICO AND THE WTO
By Gisela Bolivar ([dagger])
It is a privilege to speak at this panel in light of the importance of the role that emerging economies have played in the architecture of international economic law. I would like to thank the American Society of International Law for the opportunity to share some thoughts regarding the perspective of emerging economies and the World Trade Organization (WTO) on the subject. My remarks and comments are entirely my own and do not reflect the views of an official instance, although the data used are part of several official international sources.
EMERGING ECONOMIES' FIGURES
According to data published by the International Monetary Fund and the World Bank, in recent years emerging economies have had a more dynamic development compared with other economies, particularly in comparison to economies of developed countries. One of the biggest differences in growth occurred in the period 2007-2008. According to IMF estimates, an average growth of 1.9% for the economies of developed countries and of 6.2% for emerging economies, would be maintained between 2011 and 2015. By 2013, it is expected that the growth of emerging economies will be greater than that of developed economies. (1)
These figures largely reflect the increase in the growth rate especially in the BRIC's economies.
INTERNATIONAL ECONOMIC LAW
How then can we say that emerging economies have had an influence on the architecture of international economic law?
As some authors have pointed out, (2) we should first define what international economic law stands for. Clearly free trade, investment, international agreements relating to intellectual property, and those who establish dispute settlement mechanisms to resolve trade disputes that arise between countries should be considered as a first source of international economic law. Precedents arising from the resolution of trade disputes are also a source of such legislation. Moreover, there are some other agreements and international regulations, for example, tax agreements or provisions governing loans from international organizations such as the World Bank and the IMF, that are also an important source of international economic law.
For now, we will only refer to the first group of agreements and precedents in trade.
From my perspective, the influence of emerging economies in international economic law, has been mainly developed by the following:
(1) signing of bilateral and multilateral agreements in both trade and investment;
(2) modification of rules and internal trade legislation for trade facilitation;
(3) growing participation of these countries in various multilateral forums and especially in dispute settlement mechanisms established by the WTO and other international agreements;
(4) introducing concepts such as less-developed economies, emerging economies, and least-developed countries, among others.
As an example of an emerging economy, I will develop the following three points for the case of Mexico.
The decisionmaking process has been a difficult process in a multilateral system, particularly since the last negotiating round of the WTO has not achieved reliable responses to trade negotiations by countries at a multilateral level. Regional trade agreements have been an efficient instrument to deliver better responses regarding trade issues and trade negotiations in a regional system.
Since the early 1990's, Mexico has been one of the most active countries in the signing of bilateral trade agreements. From the opening up of trade in its economy, Mexico has been an active actor on the regional scene. Currently Mexico is a party to twelve free trade agreements with forty-four countries, twenty-eight bilateral investment treaties, and nine economic complementation agreements. (3) Mexico is also part of regional agreements such as the agreement with Central America, the Initiative of the Latin American Pacific Alliance (Alianza del Pacifico Latinoamericano), the Trade Agreement with the European Union, as well as the Asia Pacific Economic Cooperation (APEC), which has had a very interesting development through the Trans Pacific Strategic Economic Partnership (TPP).
The opening up of trade with Mexico has made the country an innovator in the integration of Mexican exporter companies in world chain production. In other words, Mexican exporter companies produce final goods with raw materials and inputs originated in numerous countries.
Regarding the influence on internal legal changes, first it is important to note that following the signing of various international agreements and because the Mexican legal system is self-executing with respect to international treaties, the country has modified, since entering the GATT in 1986, various provisions of its internal trade regulations to comply with its international obligations.
Second, as productivity is connected to a system of efficient services as part of a regime in which trade barriers are eliminated, Mexico initiated in 2008 a trade facilitation program that, among other things: (4)
(1) eliminated reference prices to import goods in more than 332 tariff numbers;
(2) eliminated requirement of registration of some imports of products that do not represent any threat for health and safety;
(3) eliminated unnecessary regulations and simplified customs procedures.
The effects of these measures, along with the economic policy that the Mexican government has undertaken for several decades, have resulted in the following:
(1) more competitive global business development;
(2) growth of foreign direct investment;
(3) integration of the North American market in certain sectors;
(4) a better rating by international agencies, which benefits the country's image abroad.
Along with this, there are some areas that affect competitiveness in Mexico, such as deficient services, telecommunications, fiscal regulations, and the existence of monopolies or oligopolies in electricity and energy along with safety issues. Lack of infrastructure has limited Mexico's progress, in addition to problems with law enforcement, justice, educational and social differences--problems that all together generate inequality in progress and backwardness in the country's development.
Mexican participation and negotiation of all the bilateral and regional free trade agreements has become the best way to promote the integration of the country with international markets.
With regard to our third point of analysis, the participation of emerging economies in the mechanisms of dispute settlement under the WTO agreements and other regional agreements, Mexico, along with other emerging countries such as Brazil, Russia, India, China, and South Africa, stand as some of the most active members of this system.
So why is it important whether these countries have been active or not in dispute settlement mechanisms? Because this greatly influences participation in determining the criteria of the WTO to resolve different cases, and in the definition of international criteria derived from other mechanisms. All these precedents confirm another source of the modification of international economic law.
THE INFLUENCE OF THE WTO IN THE ARCHITECTURE OF INTERNATIONAL ECONOMIC LAW
There are some clear examples of the definition of these international criteria, among others:
(1) The analysis in light of the WTO agreements made on safeguard measures on imports of polypropylene bags and tubular fabric established by the Dominican Republic. The main issue in this case was the applicability of GATT Article XIX and the Safeguards Agreement. The Panel concluded that "the provisional and definitive duties are safeguards, since they have suspended the Dominican Republic's obligations under GATT referred to the most-favoured nation principle, and since they have imposed a tariff surcharge, different from an ordinary customs duty, (which was not set forth in the Dominican Republic's GATT Schedule)." (5) The panel then addressed the substantive claims raised by the complainants. This was a decision that...