How would you like to go shopping and find that everywhere you went, the label said \u201cMade in the World\u201d instead of \u201cMade in China,\u201d \u201cMade in India,\u201d \u201cMade in USA\u201d etc.?\u00a0 The label on products Americans purchase that names the country in which they are made may soon be gone. \u00a0\u00a0\u00a0How could this be possible?<\/p>\n
The World Trade Organization has been working on the \u201cMade in the World<\/a>\u201d initiative for years, and in 2008, the WTO and Organization for Economic Co-operation & Development (OECD) began cooperating with other stakeholders to provide data that would shed lights on what is called \u201ctrade in tasks\u201d i.e., the domestic value added content of trade. \u00a0\u00a0While traditional statistics are necessary, they don\u2019t identify the contribution of each trade partner to the total value of the final good in the supply chain. By contributing to specific segments of a global value chains, trade partners are actually \u201ctrading tasks\u201d rather than trading final products.<\/p>\n In 2011, Andreas Maurer<\/a>, chief of the WTO’s International Trade Statistics Section, “\u2026 in the past two or three years there has been huge momentum to get the necessary information” that would be used to rationalize elimination of country of origin labeling.\u201d<\/p>\n The World Trade Organization and the European Union moved one step closer to eliminating “country of origin” labeling. On April 16, 2012<\/a>, the European Commission and WTO held a conference to mark the launch of the World Input-Output Database (WIOD). \u00a0This new database allows trade analysts to have a better view of the global value chains created by world trade.<\/p>\n Globalization is changing business models and increasing fragmentation of production. \u00a0Companies divide their operations around the world, from product design, manufacturing, to assembly and marketing, creating global production chains. \u00a0More and more products are \u2018made in the world\u2019 rather than in any particular country.<\/p>\n Today\u2019s traded products are not produced in a single location but are the end-result of a series of steps carried out in many countries around the world. \u00a0For example, cars and trucks produced by General Motors or Ford may have parts and assemblies coming from several other countries, including China.<\/p>\n Instead of counting the gross value of goods and services exchanged, the new database reveals the value-added that make up these goods and services as they are traded internationally. \u00a0The findings The Europe-based organizations instead want to adopt a “Made in the World” logo for all products on the grounds that global supply chains have rendered country of origin labeling inaccurate and obsolete. are significant as they may change the perception of the competitiveness of certain industrial sectors in some countries.<\/p>\n The WTO and OECD have been working with the U.S. International Trade Commission and the World Bank in the United States, the Institute of Developing Economies (IDE) and the Japan External Trade Organization in Asia, and the recently created World Input-Output Database (WIOD) consortium in Europe to implement the new trade statistics. The WTO has signed a contract with the OECD to start issuing official statistics on international trade based on value added.<\/p>\n The WTO’s Made in the World initiative is part of the process of “re-engineering global governance<\/strong><\/a>,” said WTO Deputy Director General Alejandro Jara at the event launching the opening of the World Input-Output Database.\u00a0 With the rise of global supply chains “it is misleading to rely solely on gross trade flows as a measure” of a country’s competitive position.\u00a0 As companies have created global supply chains, “attributing the full commercial value of imports to the last country of origin can skew bilateral trade balances, pervert the political debate on trade imbalances and may lead to wrong and counter-productive decisions,” says the WTO.<\/p>\n The intent of the WTO’s “Made in the World” initiative is to modernize global trade statistics, reduce public pressure on politicians for protectionist trade policies, and reduce public opposition to free trade.<\/p>\n Director-General Pascal Lamy<\/a> has said that \u201cimproved measurement and knowledge of actual trade flows will help better understand the interdependencies of today\u2019s national economies, supporting the design of better policies and better trade regulation worldwide.\u201d<\/p>\n In an article on the Economy in Crisis website, \u201cWTO Pushes \u2018Made in the World\u2019<\/a>\u201d on <\/strong>May 16, 2012, Karl Rusnak commented, \u201cThis may be a good PR move for the WTO and its agenda, but it doesn\u2019t change the facts: trade still picks winners and losers, and the United States consistently finds itself in the \u201closers\u201d column\u2026This new initiative takes the same ill effects that have been occurring from free trade and attempts to reframe them in a more positive light\u2026Trade deficits lead to bad results, but ultimately it is the bad results we need to look at, not the nominal number that represents the trade deficit. \u00a0If the numbers had shown that the United States was running a trade deficit but maintaining strong job growth, the WTO\u2019s new calculation method might be something worth looking at. \u00a0Instead, we have lost millions of jobs as a result of free trade. Whether you calculate our trade deficit as $100 billion or $600 billion, those job losses can still be directly attributed to our failed free trade agreements.\u201d<\/p>\n This Initiative could have dire consequences for America\u2019s manufacturers and consumers. For manufacturers, it could eliminate one of the options allowed by the WTO ?\u00a0 filing a charge for product\u00a0 \u201cdumping\u201d against another country to have countervailing duties applied against that country. \u00a0For consumers, \u201cMade in the World\u201d labels wouldn\u2019t allow you to protect your family from the tainted, harmful, and even life threatening products coming from China.\u00a0 You wouldn\u2019t be able to support saving and creating jobs for other Americans by buying \u201cMade in USA.\u201d<\/p>\n Alan Uke, founder of Underwater Kinetics, a company that manufactures high intensity lighting and other products, believes that \u201ccountry of origin\u201d labels could change consumer behavior and revive U.S. manufacturing.\u00a0 He wants the government to require a detailed country-of-origin label on every product sold in America. The label would include sourcing information on all of the product’s parts and components along with the trade balance the U.S. maintains with each of those countries. Uke outlines his proposal in his book, Buying America Back, a Real-Deal Blueprint for Restoring American Prosperit<\/a>y<\/em>.<\/p>\n The labels would be similar to those that have been successfully implemented in the U.S. food industry, describing such things as fat content, calories and nutritional values. Those labels have changed consumer behavior, forced producers to change ingredients, and motivated retailers to stock items that are demanded by customers.<\/p>\n