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Evaluating Global Trade: A Development-Friendly Perspective � An Analysis of the World Trade and Development Report 2007

This document evaluates the impact of global trade policies on development, based on the World Trade and Development Report 2007.

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    Evaluating Global Trade: A Development - Friendly Perspective – An Analysis of the World Trade and Development Report 2007 Week 7 Discussion 1 "Globalization of Trade and Finance" Please respond to the following: From the first e - Activity, give your opinion on three (3) outcomes that you believe the US recession has had on developing countries and their ability to trade. Provide specific examples of the recession’s effects to support your rationale. Triggered by the burst of the US housing bubble, in 2007, the global financial crisis led to a domino outcome across the globe as the problems in internationally - linked financial markets caused a collapse in credit and demand lea ding to recession. In a globaliz ed world, in which many economies are ever more linked as a result of the removal of barriers to trade, investment and finance, problems in one country will certainly affect others. Since China entered the World Trade Organization in 2001, the growth of trade between China and the United States has had a dramatic effect on U.S. workers and the domestic economy, though in neither case has this effect been valuable . The United States is piling up foreign debt and losing export capacity, and the growing trade deficit with China has been a prime contributor to the crisis in U.S. manufacturing employment. Between 2001 and 2011, the trade deficit with China eliminated or displaced more than 2.7 million U.S. jobs, over 2.1 million of which (76.9 percent) were in manufacturing. These lost manufacturing jobs account for more than half of all U.S. manufacturing jobs lost or displaced between 2001 and 2011 (Scott, 2012). Among specific industries, the trade deficit in the computer and electronic products industry grew the most, and 1,064,800 jobs were displaced, 38.8 percent of the 2001 – 2011 total. As a result, many of the hardest - hit congressional districts were in California, Texas, Oregon, Massachusetts, Colorado, and Minnesota, where jobs in that industry are concentrated. Some districts in North Carolina, Georgia, and Alabama were also especially hard - hit by job displacement in a variety of manufacturing industries, including computers and electronic products, textiles and apparel, and furniture. These conclusions about the jobs impact of trade with China arise from the following specific findings of this study:  Most of the jobs lost or displaced by trade with China between 2001 and 2011 were in manufacturing industries (more than 2.1 million jobs, or 76.9 percent).  Within manufacturing, rapidly growing imports of computer and electronic products (including computers, parts, semiconductors, and audio - video equipment) accounted for 54.9 percent of the $217.5 billion increase in the U.S. trade deficit with China between 2001 and 2011. The growth of this deficit contributed to the elimination of 1,064,800 U.S. jobs in computer and electronic products in this period. Indeed, in 2011, the total

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