Inside CETA: Canada - EU Trade in a Changing Global Economy

Speaker A: Welcome to IONA Asks, part of the vsc, iona's undergraduate journal. I'm Ferdinand, your host. Today. We're thrilled to have Professor Coyote Hubner with us holding the Jean Monet Chair for International Integration and Global Political Economy at ubc. Professor Huebner is a distinguished expert on international trade, European integration and, and the complexities of global economic policies. Today we'll explore a bit the nuances of the Comprehensive Economic and Trade Agreement, or also short stata, between Canada and the eu, dividing it into its achievements, its ongoing challenges, and the future of other international trade agreements. So, Professor Huebner, thank you so much for taking the time and, uh, welcome to our show. I wanted to start off by asking you to give us a quick overview of what SETA is, um, and why it's sometimes heralded as sort of a new generation of free trade agreement.

Speaker B: Yeah, it, um, indeed, uh, it was labeled from actually the very beginning and then more and more pronounced, uh, during the period of negotiations as the first 21st century trade agreement. And this is very much to do with the fact that the European Union at this point, but then also afterwards during the period of negotiations, came up with a couple of, you, let us say, ideas, concepts, how they want to arrange and write down trade agreements. And Cedar, uh, the one with Canada, huh, uh, was seen as a kind of a model, so a blueprint where they would like to use for other cases. There are a couple of elements. Uh, one is very specific for Canada and there's a history behind that. And history has to do with the fact that, uh, they were actually much, uh, earlier than 2006 when all those kind of, uh, talks started in a kind of preliminary way before they were more formal. There were other attempts to have a trade agreement with Canada, but then it turned out, due to the Constitution of Canada, without having the provinces on board, actually you can negotiate for years with the federal government. It goes nowhere. And so this was the kind of, let, uh, us say on the one side a precondition, but also it started under the Harper government in Canada, the Conservatives, uh, at the time in government, and they made it possible that really the provinces were part of the negotiation team. It was really very easily information shared and they came up with a, uh, joint position and this allowed you then later on that when, uh, it came to an end and ratification processes had to start, there was not really a big problem in Canada because the provinces were aware of that, they were part of it, they had a voice and so on. So this was the kind of the specific candidate part of it. Uh, as, as a kind of an agreement, uh, let us say at least two very important new elements. The first one is this was also a long standing idea, um, and, and wish on the side of the Europeans in Canada was the kind of the test case, the guinea pig. If you would like to open up the so called procurement, public procurement market. You know, so governments on all levels, they spend billions of Canadian dollars uh to build all kinds of infrastructure, hospitals, uh, roads, uh, ports, whatever you like it. And um, usually those kind of um, uh, tasks are being then organized within usually let's say Canadian companies. There may be a kind of a competition, a call, you know, they can order their, what they want to ask the price and those kind of things. Now we see that the idea was we have to open up the public procurement market. And this is as you can envisage was this was a difficult problem because provinces also used, not at a federal level, used, think about military and so on, when they used their public procurement, uh, affairs in a way to support their clientele, to support voters, regions, provinces and so on. And so this was the first kind of thing. And the Canadian government was willing to do that in the European case due to the Common Market. This actually happened many years, many, many years earlier. The Common Market also before it was in place in the mid-1980s, uh, each government had their own public procurement process. And now then with the Common Market it was opened up within the 28 countries at a time, now 27. So this was one new element and a second one has to do that, um, even though it's not so prominent. But uh, the agreement also includes, let us say environmental and labor standard chapters. So really something that is catering, uh, also a bit to NGOs, to trade unions, making clear there are minimum standards and so on. But this has been included in this, uh, in the cedar negotiations. I think those are the two main elements, the core. So to say when it comes really to what is happening with uh, tariffs and quotas, um, the idea is

Speaker A: it

Speaker B: differs between uh, industries and sectors. Uh, but the tariffs actually were not very high, but they were there and it could be a hurdle. And uh, they were supposed to come down to 98% and then to zero. We are close now after six years, the zero period for quite a lot of uh, uh, goods and services, not so much, uh, let us say agriculture, but also within the kind of the hardcore of um, tangibles like cars and so on. There are still quotas. So it's not a total free trade agreement. There are still quotas. There so at the moment the quotas available are not being used up. Uh, nobody buys all those expensive BMWs and Mercedes any longer. Tesla, things have changed a bit. But you know, so the idea is bringing down terrorists to a zero level. And so this is more or less the kind of package they were negotiating. But obviously uh, the Cedar text has more than 1000 pages close with appendices close to 1400. You can see there's quite a lot in my pharmaceuticals. There are so many, many elements included. But this is the kind of core element.

Speaker A: And um, so I mean SATA has done a great job in lowering tariffs and getting rid of a lot of tariffs. But um, some people argue that, that it has certain areas that are slightly outdated, especially when it comes to financial services, uh, or digital trade. Um, how would you say these challenges kind of impact its effectiveness. And are there any steps being taken to try to alleviate um, these issues?

Speaker B: Yeah, totally correct. Uh, even though the CEDAR has been labeled as the First 20 Century Trade Agreement, you uh, mentioned, uh, particularly services, a lot of trade in the meantime, globally spoken and also domestically is about services on all levels. And digital merchandise, uh, digital trade, uh, also has become so prominent uh, since go back 2016 when CETA was finally finished the negotiations. Uh, in this regard I would say uh, CEDAR was already outdated. It comes to the service part. Uh, this is also due to the fact that there was a lot of uh, you know, put it this way, services are not totally uh, free traded even within the European Union. There are still all kind of hurdles and so on. Despite all the efforts uh, in regards to open up uh, trade in services within the EU 27 or 28. So it is always a kind of difficult problem when it comes then to external parties, so to say in this case Canada. Uh, so there was a, hesitant on both sides uh, dealing with that. Uh, but it was pretty clear this, they can't afford to leave those sectors out. The financial sector as well, uh, as uh, digital and a couple of others. Now Cedar includes a kind of, it's, it's an agreement as we know, but also it's a kind of system with the own governance, uh, regime. And there are various kind of. It's shared, the governance is shared by the EU side and the Canadian side. Representative governments are meeting and they work out kind of topics that need to be further developed, discussed, negotiated. And this is being done then by so called working groups. There's a working group on a digital market, there's a working group on finance, there are a couple of others. Uh, I Would say, uh, negotiations are very slow. Uh, and this also has to do with the fact that, uh, it's not the only reason, but one reason. Uh, let's say, let us say the appetite on the side of uh, the member states of European Union to go deeper is a bit lower, less than it used to be. And this is best, uh, shown by the fact that CETA is still only in preliminary effect. So it's not ratified across all 27 countries. Only I think to 19 at the moment or 20 have ratified it. And there are other reasons for that. But, um, there are a couple of countries who I would assume they will never ratify it. And so this means that if you don't ratify it and then at the same time you want early to exchange to, to, to enlarge it into more things, uh, that's a bit difficult. And therefore the working groups, I think are meeting slow. The outcomes are very slow. We don't know exactly when it's transparent. You can look up the kind of the protocols from the meetings, but they don't say a, uh, lot. So I don't think so that um, there will be, let us say, revolutionary changes happening in those areas.

Speaker A: And, and if we go back to those working groups, are these working groups between the European Parliament and the Canadian House of Commons or what are those

Speaker B: working groups, first of all bringing together representatives from the Commission as the kind of executive arm of the European Union and from the Canadian government. Uh, they open it up, uh, for also, uh, let's say NGOs and also the Parliament on both sides are getting um, let us say, I don't want to say a word a say. But they are getting informed because this working group doesn't mean they only come up with kind of ideas. And until this then would become part of Cedar, then it have to go through the regular kind of, uh, parliamentary processes and they will be informed before. But at the moment it's more or less on both sides. They look what are the interests, what they would like to do, where is it going to. And sometimes also there's the hope, you know, to find rather than dealing with those two issues, for example. But there are others too, uh, only bilateral. Then maybe at the idea, maybe they can find a kind more global, uh, within a WTO or so an agreement that would then help moving those kind of things. So it's not really clear how serious really how deep they would like to go in those two areas because they fear if they go too far, means you open up too much, then maybe this is a signal to others say, okay, then we want the same kind of openness and the same kind of access to those two in those two areas. And uh, so this explains a bit the slow speed, uh, in those negotiations.

Speaker A: And um, I mean, I think some people might get confused when they see the agreement because if you go online, it says it's provisionally applied but not in force. Is. Does that just mean that certain countries in the EU have not signed on to it, but the countries that have signed on to have fully signed on to it? Are there levels also to how much.

Speaker B: The way it works, uh, is that CETA as such is fully working for all, Let us say, 27 member states of the European Union. And so also for Canada, uh, the preliminary part means only there is particularly one chapter that is not being applied. And the one chapter that is not being applied is the one that was really close to break actually the CETA negotiations. And that's the investment chapter. So Canada and the European Union are both entities, particularly Canada were heavily, uh, involved in foreign direct investment flows inward, but also outward. And the same holds for the European Union. And, uh, in regular kind of trade agreements, not only CEDAR and regular trade agreements, there is, uh, kind of standard procedure included. There also may be sometimes slight deviations, but the core is pretty clear. And the standard procedure is in case there is any problem when it comes, let us say a Canadian company would invest in France, and then a French government would decide this kind of investment is not following particular kind of, let's say, environmental rules or something like this. Then they could, uh, take, so to say, the property of this company, and, uh, we don't allow it any longer. And then the company would be in a situation, they invested X amount of, uh, dollars and they would lose it. And in order to avoid this problem or to deal with it, the investor is called investor state dispute mechanism. The investor, based on, uh, trade agreements, then go to a particular kind of institution, a committee, and say, okay, no, this is not fair, and, uh, we need to deal with it. And actually can also, when there are particular kind of flaws in one country that would violate the interest of an investor, they can do the same kind of thing. And then this committee would decide whether, uh, uh, this company is correct, and they would get some compensation or not. And the question always is, who is this committee? Who's electing me? Who is sending people there? And uh, so this was a very transparent and still intransparent kind of mechanism. Also globally and, uh, during the Cedar negotiations, this has become the issue Particularly from the side of NGOs, some trade unions on. And we're saying this is now no longer public law, public just courts that are making those decisions. Those are private courts. They are not in control. Nobody knows. They have no legitimization. There's no way how to understand what they are doing. And uh, so, uh, there was huge demonstrations, uh, in Berlin, I think there were almost 300,000 people in France, in Belgium, a couple of hundred thousand, uh, protesting against, particularly this part of cedar. They had other things too, but this was the, the main element. And this created this situation, uh, that then uh, actually, uh, also the leadership from the German Social Democratic Party was making the strong case, um, you know, we should change it. Now there's a second element in all this due to the fact that this investment chapter, uh, was part of CEDAR in its original version. The question came up is actually the European Commission has the European Commission the right to negotiate in the name of all 27. Uh, also this chapter. And this led to a kind of, uh, judicial kind of, uh, uh, debate and fight between the Commission and the European Parliament. Uh, and uh, the decision by the European Court of Justice was that CETA is a so called mixed agreement. So the Commission was negotiating parts. They are actually not allowed to negotiate. And this brought this kind of situation that member states had now out of a sudden a much stronger say than ever before. And uh, so the result was then they had to find compromises. And the compromise was that this chapter first of all is there. They made all kind of modifications, probably improved the investment chapter, but still not all member states are happy. Uh, and then just uh, led to this kind of situation that this chapter is actually not applied. All the others are. And that's from a legal perspective, obviously possible. And uh, so there we are. So CETA is there. One chapter is not applied, but all the other elements are applied for all 27 member states of the EU and also for Canada.

Speaker A: Thank you very much. Um, so I guess what we'll move on to next maybe is kind of as populism grows in Europe, um, you've seen a lot of leaders who have become critical of large multinational corporations. Um, and um, they sometimes argue that large free trade deals also, um, you know, are made at the expense of the common worker in their country or also at the expense of the sovereignty of certain nations. Um, how would you respond to some of these concerns? And do you think that is an issue for agreements in the future that, or uh, free trade agreements in general that a lot of populist Parties will try to stand against them in Europe.

Speaker B: Yeah, I would say it's not an issue in regards to Cedar, but your question is more general and there I think it is really uh, an issue for a variety of reasons. Number one is ah, this only a kind of statement. First of all an observation widely shared. I would say the vast majority of so called right wing populist parties in Europe and as we know they are really on the rise in all countries then they may uh, become a very critical voice in the upcoming elections for the European Parliament. A vast majority of them are anti globalist. They see uh, the cause for a lot of problems in those processes of hyper globalization and I think so they have this in common with some of the leftist parties and uh, uh, there is more than a kernel of truth in all that. Uh we know from a variety of studies they started out particularly in the U.S. uh this was a so called China shock studies uh, by uh, David and a couple of other authors and they've shown and has been confirmed by other studies that indeed uh, in regions within nation states where there's a very large import, uh competition due to trade agreements so cheaper goods uh, and services come into a country and then they are actually uh, in competition with producers in particular concentrated regions that in those regions who experience those import shocks the uh, number of uh, unemployment or the level of unemployment has increased above the average of the nation state and the real wages in those regions has come lower than the average of the nation state. So that's a China shock means there are social costs involved if you go, if you open up trade in a kind of uh, unregulated way. And uh, this is uh, a concern obviously for people there. It's a, it's really very much of them a shock. And this feeds into uh, their voting behavior. And right wing populist parties are aware of that. They take it up, they maybe, maybe uh, radicalize the kind of the implications a bit more and see then the problem is caused by outside, by them. They have this kind of division between us and them and them are ah, the others. And therefore they are very much in favor of two things actually. One thing is they have this in common with Donald Trump and the U.S. uh they are very much in favor of harsh uh, and high tariffs. Uh on the other side maybe they don't have this in common with Donald Trump but they also have in their programs uh, in favor of higher solar uh social welfare payment. So that's the kind of the offers they give to those kind of people who are above the average affected from trade agreements. Because we have to be sure we know this from Economics 101 since David Ricardo, uh, trade, free trade is not only producing winners, it's also producing losers. Overall trade is maybe a good thing, no doubt about it. But we have to see uh, this kind of distribution of winners and losers. And if you don't deal with it, that's exactly the opening for right wing populist parties. And if they have really a stronger voice in European Parliament coming uh, uh, June this year, this will make it much more difficult for an entity like the EU, uh to follow through with their trade agreements plan plans they have on their shelves.

Speaker A: You do see a certain threat to certain trade agreements that the EU um wants to sign or is currently involved in if let's say the EU Parliament elections swing a certain direction this summer.

Speaker B: Yeah, I mean it's an interesting development. We see for example that again for a variety of reasons the agreement with the MERCOSUR countries that was close to be signed off is not happening. Uh, from both sides. It's not happening and nothing to do with the right wing populist parties. In this case it's all about environmental standards. And the more center left parties and the Greens are not very happy about the fact to uh, have uh, let us say opening the beef market, let us say for Argentina when we know that the production of uh, 1 kg of beef is producing x amount of uh, CO2 emissions and those kind of things that are the rainforest problem in Brazil and now from the side of, of the Berco countries. You know, Lulu has uh, recently be also in Germany and other parts of Europe and he was then more willing to give up his kind of resistance. But then we see Mile in Argentina and uh, he's no longer interested in having any kind of agreement at all. So it's a very kind of complex situation, a global economy currently to come up with any kind of meaningful uh, trade agreements at all. There's also as you can see the problem. We haven't seen any kind of trade agreement outside of the US because uh, the Biden administration, they don't dare to open this kind of topic. Uh, they wouldn't have the majority in the houses and uh, so even the Democrats are becoming very skeptical. So when it comes to trade agreements, you know, things are moving very, very slow, slow and in some areas even backwards.

Speaker A: And let's. Going back to the case of the U.S. do you feel that there still is a possibility going forward that the EU and the US will sign a trade agreement or do you think this kind of sentiment of free trade and um, basically working together on trade agreements is not mainstream at all anymore in both the Democratic and Republican Party and we're slipping more into protectionism?

Speaker B: Yeah, I think so. There is currently no appetite on both sides, on the side of both parties in the United States uh, to do anything. Uh, again the Republicans, uh, they are getting more, let's say inward looking and they are more interested in maximizing uh, the interest of the common American workers, so to say, um, only protecting all the kind of those traditional industries on the one side, other side. They're also very outward looking when it comes to the idea that uh, it's now in the meantime the largest exporter of fossil fuels and they see more opportunities if they turn around the um, environmental policies of the Biden administration even to export more. But for doing this you actually don't need a trade agreement? I don't think so that they are interested in this. They're very, in a kind of bilateral way looking at various partners and to punish them or force them to various kind of um, let us say compromises and so on. And the Democrats are traditionally anyway much more. The free trade party are traditionally has been used to be Republicans, Uh, the Democrats are traditionally more uh, protectionist again looking at the clientele of their voters and I can't see any kind of appetite on their side. And uh, so as we know the geopolitical situation is anyway very fluid. Uh there is tensions with China I don't think so that um, the Biden administration is not less harsh than uh, the US than the Trump administration. Uh, maybe not in words so much but in action, ah, quite a lot of those tariffs also in quotas also with Europe are still in place, not to talk about other places. And then we have something like the uh, so called inflation reduction act that's actually a kind of industrial uh, policy project, very large in terms of volume. And we can see already uh, quite a lot of European capital companies are moving to the US with some of their activities because they are, first of all they're getting subsidies and second this allows them also to produce at their market. And consumers think about the car industry. They only get for example a rebate for a battery driven car if this car is produced in the US So rather than Volkswagen others producing their cars in Germany, they produce it there. So we see this, that's also a kind of protectionist measure. So we see a lot of things are changing and uh, for the moment I would be very skeptical that uh, Any kind of meaningful trade agreement, whether it's uh, with the US and other entities in other areas, is really moving forward in a meaningful way.

Speaker A: Yeah, because that's quite interesting. I feel like a few decades ago you saw, you know, a lot of hope for signing new agreements. But now that uh, the MERCOSUR trade deal has not gone through, there's not that much hope for an agreement between the EU and the US and the geopolitical situation with China get more difficult. It does kind of um, I guess become important to secure the trade deals that do exist, especially ah Sita, and make sure that um, one doesn't wind that um, too far back or doesn't allow it to be uh, unwound too much, um, uh, by uh, more populist forces that may come up in both, on both sides of the Atlantic. Um,

Speaker B: so I guess, um, only one. Go ahead. If I may think about the other entity we didn't talk about. There's also long standing trade negotiations with India for example, you know, and uh, uh, India, we uh, say between India and the European Union. That is why we need not to talk about a formation, uh, in the Asia Pacific region. So we see things happening or not happening. India, EU is, you know, it was close to getting uh, a last step, but then again, uh, all kind of issues are coming up and you know, it's difficult now to come up with a get out of, put it this way, getting the support with the European Parliament, uh, if you need uh, to sign a trade agreement with a MODI government that is seen as a very nationalistic kind of government, not playing up to rules of, let us say, human rights and recognition, uh, of minority rights and those kind of things. So all those elements. So it's not only economic. There are political, cultural problems coming together at the moment. And that um, makes uh, those kind of policies, trade policy, extremely difficult. Unlike in the period of hyperglobalization, as you rightly mentioned, everybody was thinking, not everybody, but a majority were thinking we need only trade agreements. And then things are moving forward and everybody is benefiting. So the world has changed. And we realize also that uh, trade is macroeconomic, uh, spoken a good thing, but it comes with this kind of win or loser situation. And governments were often not prepared to dealing with it.

Speaker A: And I guess that's actually an interesting point, uh, you brought up with uh, the potential trade agreement with India. And one thing that I was kind of wondering there is, do you think you'll see the EU when they continue in their negotiations, kind of putting less emphasis on environmental standards, on human rights standards, and more on pragmatism. Or do you think going forward those things, those pillars will become more and more important in their negotiations?

Speaker B: Yeah, we see with uh, the current commission, uh, and that may not be at least Ursula line may continue depending from the outcome of the election. But we can I guess expect that this is happening. And even though she's not setting the tone all by herself. But it's pretty obvious that the first of all there's a kind of more, a bit stepping back from very ambitious details when it comes to climate policy, things about all this kind of compromises now with the farmers, but a lot of other things that have been postponed or more softened and the emphasis now is more about security. And they learned from the, from the Russian invasion of uh, Ukraine that it's not you can have trade relations, but it's also good to think about, let us say, the reliability of your partners. And so what we see is now a bit of reorientation to find, to identify the right kind of partners. And this also holds for China. It's a difficult kind of situation. There are systemic competitor, that's the official term. And at the same time there is also kind of cooperation. So everything will be much more selective. And you may see industries areas where actually um, rather than making use of global markets, uh, some markets only for security reasons, for economic reasons may be shut off, being shut off and the focus making maybe more going to, let's say, a reliable partner. Think about, for example, when it comes to energy, uh, there's much more now, uh, liquefied gas or so from Norway. And if they would be able to produce more for Europe, they would do it, those kind of things. So you may see this kind of a very selective restructuring, a reorientation of global trade relations from this perspective.

Speaker A: Yeah, that's interesting. And uh, are there any lessons from CETA that you think, um, uh, are important, um, for the EU to take into consideration, uh, when negotiating new agreements now in the future, any things that you think went very well that should definitely be implemented and certain things they tried that really didn't work out and they should kind of push more into the background.

Speaker B: Ah, one thing is, uh, there need to be a new kind of relationship between, let us say sovereignty and openness. And during this period of hyperglobalization also then in some of those trade agreements you could see, uh, not only from the eu, from other, uh, entities too. Uh, it comes with quite a lot of loss of serenity because all of a sudden you Introduce with those kind of competitive trade relations you introduce other norms, laws, competitiveness, competitiveness indicators. And they sometimes are undermining or are uh. Contradicting national standards under the name of globalization and cheaper prices and market access. A lot of those things of those let's say established standards have come under pressure and governments very often had really they have to give in. Think about the kind of uh, let us say uh, the locational decisions recent last two years or so Tesla in Germany, Brandenburg were you know choosing a kind of weak region that is an urge to have more jobs and foreign investment. And they came and they could really uh. Totally mix up all the kind of the usual kind of procedures how what you need to do environmental analysis, all those kind of things. In two years they could erect a kind uh of fabrication line that's pretty big actually. And uh. So others are looking is this the future? And you know, and governments had really not a lot to uh influence any longer. They are dependent from international money, put it this way. And this is seen as kind of lots of serenity due to openness. And I think so what we are, what we may see, what you could see in a best way rather than now closing off anti globalization and doing this kind of right wing populist strategy, finding a kind of view balance between uh. Openness and still uh let us say safeguarding the established social and understand arrival of standards in nation states or in national entities or entities like the European Union. This will be a difficult task but it's doable. And um. So there is actually for those of you who are interested and if you're interested, uh one of the most prominent economists, um, uh. Dan Roderick, Danny Roderick from Harvard, uh he published quite a lot of uh, very interesting books. Very early on he was very critical of this processes of hyper globalization. But being himself not a free trader but a trader. He is in favor of uh, uh, open trade relations but in a different kind of way. And in one is more uh. Talking straight about uh. Trade. In one of most recent books for example he tried to develop some kind of uh, let's say models or so how this new battles could be negotiated, how those trade agreements should be uh, uh written and so on. And also we have to be aware for example one big element this includes and also who actually should negotiate. We see that a lot of those trade agreements this includes also a bit cedar is written and made in favor of very special interests, particular kind of floppy groups, you know who are interested in trade, imports or exports. They have quite a lot of say in those processes and uh, so open up, uh, having kind of more public discourses, conversations, bringing in more other groups starting from trade unions to NGOs and so on to have a kind of mixed experiences, uh, maybe one way to negotiate those kind of uh, agreements and this would mean probably some of them will no longer have the same range, the same kind of depth, a bit smaller but still maybe meaningful and uh, still allowing uh, to, to benefit from a lot of those efficiency gains that are included in trade. So you have to find this kind of right balance, democratic, uh, let us say, um, values and standards and economic efficiency gains. And this is the kind of the art, so to say of probably you. Trade negotiations in the next couple of years.

Speaker A: Yeah, no, that's very interesting because I think um, on the one hand people, a large group of people benefit a lot from trade agreements. Um, but some people also then just see oh my local factory is closing, uh, my um, friend doesn't have a job anymore. But they don't realize that for the economy as a whole it really worked out well. And then maybe it'd be important in the future for policymakers to then design certain equalization programs or programs that then benefit the areas that were not uh, that didn't benefit um, um from the agreements.

Speaker B: That's something that's very often forgotten. Also I would say, uh, one of the problems in public political communication uh, across. If politicians are talking about trade and they try to make the case, there are so many examples, it's easy to find them if you Google it. Uh, all of them are saying it's a win win situation, everybody's winning. But uh, that's a macroeconomic perspective. We know it's a win win maybe for Canada and for the EU as such. Because also if you look at the trade volume that's grown and so on and so on, but on a kind of disaggregated level. Obviously not everybody can win because uh, if it's possible you buy stuff, uh, goods and services that are cheaper and the same quality and then the producers who are not able to compete on this level, they lose out and workers then in those kind of industries lose out. So therefore you need to find ways to compensate them. That has to do with labor market policies, regional policies and so on. Very often it's just forgotten and you need to have the resources and to allocate resources in a proper way in order to avoid this kind of disappointment. Uh, so that uh, workers can still continue having, making a living and maybe even a better way but with different Jobs. And we see this in a fascinating way currently. Um, sometimes successful, sometimes not. In the move away from traditional cars to battery driven cars, a lot of those skills are no longer necessary. You know, you see a kind of restructuring of the composition of the labor force in these industries. And um, you have to make sure you also need new skills. You need to have to make sure that the used skills workers are available and those ones you don't need any longer. Either you restart skill than them or you find other uh, things that are coming along. So that's also gives you a good case. Even though uh, a trade is between at the end of the day, private actors, companies and then comes to the consumers and so on, it's always included state action, uh, without them having a kind of say and managing those things, it's getting astray.

Speaker A: And um, lastly, for any of us, um, who would like to delve deeper into the topic or gain kind of a new perspective on international trade and maybe SATA in specific, are there any books or articles or journals that you recommend to take a look at?

Speaker B: Yeah, as I mentioned, uh, this is one of my favorite authors in this area, Danny Rodri from Har. Danny Rodri. And his most recent book is. It's a composition of essays he published in various kind of uh, economic journals talking straight about trade. Uh, uh, it's pretty fascinating. And uh, he has a couple of other books and he's also writing with other authors. So that's something uh, easy accessible because those kind of books are unlike his other articles are not with a lot of math or something like this. It's really making good economic cases. And um, he's also very critical within the traditional 101 economic profession. So to say that uh, there are often new, in a very naive way, you use these models and apply them to reality. So he's a bit more careful in this regard, but still, uh, has a lot of academic reputation. So that's really something I would um, recommend uh, to read.

Speaker A: Professor Hubner, thank you so much. It's been a pleasure talking to you today about seta, uh, and international trade in general. And also thank you to the listeners for tuning in today to iona. Ask for more insightful discussions on economics and political issues shaping our world. Please follow us on Spotify or visit our website@uh, ionagernal.ca podcasts. Until next time.