European trade chief Phil Hogan mulls bid for WTO top job

Phil Hogan. (Reuters)
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Updated 01 June 2020

European trade chief Phil Hogan mulls bid for WTO top job

  • The new chief will also have to push forward talks to limit overfishing and set new rules on e-commerce

BRUSSELS: European trade commissioner Phil Hogan is considering putting his name forward as a candidate to be the next director-general of the World Trade Organization, his spokesman said on Sunday.

The WTO post will become vacant at the end of August after incumbent Roberto Azevedo said he would step down a year early.

The next director-general will be faced with intensifying US-China tensions and rising protectionism, exacerbated by the COVID-19 pandemic. The new chief will also have to push forward talks to limit overfishing and set new rules on e-commerce.

Hogan, an Irishman, has been a European commissioner since 2014, initially responsible for agriculture and since late 2019 for trade.

He told the European Parliament on Thursday that it would be “wonderful” if a European became the next head of the Geneva-based trade body.

Two other potential European candidates are Spanish Foreign Minister Arancha Gonzalez Laya and Dutch Trade Minister Sigrid Kaag.

The issue could become a central topic of a meeting of EU ministers responsible for trade provisionally set for June 9. Europe could then put forward a single candidate.

WTO members can nominate their own nationals as candidates from June 8 to July 8.

With three of the previous six directors-general from Europe and the others from Thailand, Brazil and New Zealand, there is some pressure to choose a leader from Africa, with four names from the continent being cited.

Some in Europe though say that there is an unwritten rule at the WTO that the director-general post should alternate between the developed and developing world. Azevedo is Brazilian.

There is also a general consensus that the body itself needs reform, with critics saying it must take into account the rise of China and state-owned enterprises.

“He’s a strong supporter of a reform agenda for the WTO,” Hogan’s spokesman said.


Analysts urge Canada to focus on boosting the economy

Updated 06 July 2020

Analysts urge Canada to focus on boosting the economy

  • Canada lost one of its coveted triple-A ratings in June when Fitch downgraded it for the first time

TORONTO: Canada should focus on boosting economic growth after getting pummeled by the COVID-19 crisis, analysts say, even as concerns about the sustainability of its debt are growing, with Fitch downgrading the nation’s rating just over a week ago.

Canadian Finance Minister Bill Morneau will deliver a “fiscal snapshot” on Wednesday that will outline the current balance sheet and may give an idea of the money the government is setting aside for the future.

As the economy recovers, some fiscal support measures, which are expected to boost the budget deficit sharply, could be wound down and replaced by incentives meant to get people back to work and measures to boost economic growth, economists said.

“The only solution to these large deficits is growth, so we need a transition to a pro-growth agenda,” said Craig Wright, chief economist at Royal Bank of Canada. The IMF expects Canada’s economy to contract by 8.4 percent this year. Ottawa is already rolling out more than C$150 billion in direct economic aid, including payments to workers impacted by COVID-19.

Further stimulus measures could include a green growth strategy, as well as spending on infrastructure, including smart infrastructure, economists said. Smart infrastructure makes use of digital technology.

“We have to make sure that government spending is calibrated to the economy of the future rather than the economy of the past,” Wright said.

Canada lost one of its coveted triple-A ratings in June when Fitch downgraded it for the first time, citing the billions of dollars in emergency aid Ottawa has spent to help bridge the downturn caused by COVID-19 shutdowns.

Standard & Poor’s, Moody’s and DBRS still give Canadian debt the highest rating. At DBRS, Michael Heydt, the lead sovereign analyst on Canada, says his concern is about potential structural damage to the economy if the slowdown lingers too long.

Fiscal policymakers “need to be confident that there is a recovery underway before they start talking about (debt) consolidation,” Heydt said.

Fitch expects Canada’s total government debt will rise to 115.1 percent of GDP in 2020 from 88.3 percent in 2019.

Royce Mendes, a senior economist at CIBC Capital Markets, said the economy still needs more support.

“Turning too quickly toward austerity would be a clear mistake,” he said.