 You all, no doubt, enjoy it often. And we have Mr. Timothy Stratford, who is a managing partner at Covington and Burling, and a former US trade negotiator with China. And I, by the way, am Robert Guest. I'm the foreign editor at The Economist magazine. So let's jump straight into it with Tim. There appears to be a trade war brewing. How worried should we be? Well, I think we should be very concerned. I think it's serious. I think that we've come to the point now that both governments recognize that the real issues have to do with deep systemic differences between the economic systems of the two countries. If you want to get the clearest idea of the US concerns, you can read the report that was issued by the US Trade Representative's office back in March. And it talks about technology flows and things like that. And I think what's very significant is that at the end of the report, after describing the injury that the USGR thinks US is suffering, it lists three remedies. One is to impose tariffs in order to bring China to the negotiating table. Another is to impose some investment restrictions. And the third one is to bring a WTO case. But the WTO case is only about a very, very narrow technical issue. And it scarcely begins to address the underlying concerns that are put in the report. So what that means is it's basically saying that the WTO system, as it exists, is not adequate to deal with the nature of the dispute between the two countries. And therefore, the US is acting more unilaterally in imposing tariffs and doing these sorts of things. So what you'll find is that if you talk to the EU or you talk to Japan, those governments tend to agree with the US's assessment of what the problems are. But they are much more hesitant to go outside of the WTO system to try to address it. But where we are is you have two governments, US and China, that have very different positions. There's a big gap between the positions. And I think now we're going to be in for a rather long period of deadlock where each side is sort of assessing how much are the tariffs hurting me, how much are they hurting the other side, how flexible is the other side going to be to negotiate. And I think it's going to take some time before we figure out what a solution to this problem really looks like. I'm going to move to TAC. I mean, you're from Japan. You've come from a country that has experienced similar things with America in the past, except possibly on a smaller scale. What would be your historical perspective on this? Yes, we struggled this trade war for as long as a 2D case. So between the US and China, just to start it, so 20 years, going back to the 70s, 80s, we had problems of the semi-conductors and then automobiles. The first one with the semi-conductors, there was no foundation like WTO to govern the rules of the world trade. So we were completely defeated. And we accepted that 20% of the import from the US. By the way, we dumped almost all the semi-conductors to the Tokyo Bay. And that ruined the industry of the semi-conductors eventually. But at the time of the second challenge from the United States to automobiles, we went to the WTO because the WTO was founded. And eventually, we shifted our car production to the United States. That alleviated the tensions with the United States. So we got the learnings. One, we just shifted the production to the United States to create jobs in the US. Second, I think international rulemaking is a prerequisite to resolve the issues between countries. So at that time, WTO is weak now. But what about the RCEP, for example? And we tried to create a TPP with Wendy when she was in charge. And that was a great job. Thank you for that. But now, it's gone. It's gone, sorry. That's not your responsibility. But we need a regional trade pact, like Chinese Premier Li mentioned in his speech. That is incredibly right. We have to create something like international rulemaking. Like RCEP. And I think at this time, Japan and China should promote RCEP to be materialized. So that's our learning. But a huge difference from then and now is the data flow and IP, which is a landscape of the current business and the current economy to drive the world. So what to do with the high standard? What to do with the data flow? What to do with IP? That's a huge difference from our experience of the 70s and 80s. I mean, you mentioned the idea of Japanese car companies in response to pressure deciding to build more cars in America. Do you think that's going to happen this time round with China? I don't think so. Because Japan had a certain level of the technology at the time. And Toyota and those Honda, they were so popular in states. So we had some contribution to consumers to be supported, I mean, to support our cars at that time. I'm not sure about the case with China. One thing is clear. Let me talk a little bit. The current president, the president is predictable in a sense. Particularly in China, that is. Right, because goods and technology. That's the pull for the session, isn't it? So it's an intricate path. But it's really predictable in a short term. Because he just repeats what happened in the 70s and 80s. Well, he does seem to think that we are living in the 70s and 80s, doesn't he? So Wendy, I'll bring you in here. Now, you have been working on trade issues since 1988, which suggests you started while you were still in nursery school. A lot of people have changed their minds about trade over that period. I have a quote here from Peter Navarro, who, as I'm sure many of you know, is Donald Trump's biggest advisor on trade. And this is what he said in 1984. He said, as history has painfully taught us, once protectionist wars begin, the likely result is a deadly and well-nigh unstoppable downward spiral by the entire world economy. He seems to have changed his tone a bit since then. Wendy, what has driven this move, which we see, it seems global towards greater protectionism and the belief, as Donald Trump put it, that you can win trade wars. What's going on? Well, I think a number of things are going on. First, I think there's just a growing segment of the US population, but also in Europe and I believe will spread elsewhere. Folks who believe that they have not benefited from these trade agreements and from international trade and globalization more broadly. And so these parts of our society have become very vocal. And as a result, I think a lot of people in the United States, and we really saw that in our recent presidential election, where both parties are really questioning trade. And I would argue that TPP almost became the poster child of everything that was wrong with trade. And as a result, the president on the third day in office withdrew the United States from that agreement, which I believe was a mistake. I also believe that just picking up on something that Tim said, there is a real serious view that the administration shares, but also other people share, and I share this as well, is that the WTO rules really haven't kept up to date with the types of trade practices and the types of countries that have integrated themselves into the trading system. And if you think about the WTO, the last time really the rules were updated and what we call a big multilateral trading round was over 25 years ago. The internet was barely around then. A lot of the major trading countries really weren't, China wasn't even a part of the WTO then. And so as a result, we see the WTO today really becoming increasingly on the sidelines of what's going on. And frankly, if it doesn't deal with the need to really update the rules and figure out a way to become relevant, it really may even slip into the background more. And that's dangerous because that means that countries, and this includes the United States now, decides that it will take the rules into its own hands and do what it needs to do to achieve its national objectives. But this is the big difficulty, isn't it? The rules-based order was based on the idea that everyone follows WTO rules most of the time. There's a dispute mechanism for resolving that. And you deal with everything on a multilateral basis, and that way the big countries don't get to push. The little ones around and the little ones feel that it's in their interest to be in the system. But that system, that multilateral system, has not produced a big new trade agreement for practically a generation. So as you say, something was broken. Now, the question is, I mean, there's a short-term and a long-term question. We've got the short-term question of, is there going to be, is the short-term conflict between America and China going to be headed off with brinkmanship, or is it going to have ripples that will be felt all around the world? Are we going to be able to avoid disaster of the sort that Peter Navarro once predicted in the short-term? And then there's the question of, will we be able to use this as an opportunity to reform the system? Perhaps Tim would like to answer that. If you look at the rule system, you talked about part of the assumption being that people would follow the rules and go to WTO for dispute settlement. And I've already described how the US hasn't seen that that would be effective in case of the current dispute. Going beyond that, other assumptions underlying the WTO are, number one, there's an assumption that countries would believe that a market economy is more efficient than a planned economy. And there's an understanding that countries will sometimes deviate that from that, but they'll do it more as an anomaly rather than as a general characteristic of their economy. And that's being challenged now. And those of us who look at the Chinese system believe that China has decided that state intervention in a whole range of important technologies is the way they're trying to move ahead. And they may decide that that's in their best interest, but if they do, that's not what we assume when the rules were made. And it's not just an anomaly. It's a fundamental characteristic of a major economy. That's the first issue. The second issue, the leaders of China have decided that they should be self-sufficient in certain technologies. Semiconductors is the most recent example. We look at the ZTE case. And Chinese leaders are saying, we can't be vulnerable to other countries to supply this key technology to us. But if you decide that, then you're throwing the principle of comparative advantage out the window. And maybe that's a legitimate decision. But then you have to go back and look at the trade rules that were based on a different assumption. And to the extent that China is doing that for a number of sectors, then those sectors and every sector impacted by them becomes a place where maybe the WTO rules don't work as intended. And then the third big concern has to do with national security. Countries always need to be able to make decisions for their own national security. But now we have a couple of things. We have the fact that geopolitical tensions between China and the United States and some other countries are rising. So national security becomes a more important consideration. But at the same time, we have more technologies that are developed by the private sector and instead of by the military-industrial complex. They're developed in the private sector, but they have profound national security, national defense implications, big data, AI, semiconductors, and so on. And so if those technologies are pervasive across the entire economy, we use them in our smartphones. We use them when we buy things and so on. Then how do you separate out the national security component from the civilian component of these technologies? So these are three areas where there are changes in what's going on now that really cause us maybe to shrink the space where comparative advantage and market economies are still applicable principles. Which is difficult because it is in a country's national security advantage to be richer. And if you think that your national security is best served by shutting yourself off from the outside world, you're going to end up with worse technology, higher prices, and a poorer country. Well, that's true. But then you have to figure out, OK, we want to achieve both objectives. How do we find the right balance? And the analogy that I use is that we go to a football game on one side of the field is the winner of the American Super Bowl. On the other side is the winner of the World Cup. They're both there to play football, but they have very different concepts of what this game is supposed to be like. And if the rules are broad enough so that both teams can play according to their own ideas of football, there are going to be a lot of problems that are going to rise. And I think that we have a comparable situation in terms of the way the US and the Chinese are playing the economic development game. So, Tak, I'll bring you in here. How is this, how has it so far affected what's going on in the private sector? How has it affected your company? How has it affected other companies around you in Japan? And how worried are you about where it goes from here? As of the immediate threat, and already it's happening, some of people know that we have the huge investment to the United States. And we produce, for example, bourbon. And that's exported to EU countries. And we've got already sanctioned from Europe. And immediate issues is already going on to hurt our bottom line. And for example, we are exporting some products from the United States to China. So the global supply chain is getting hard by the US aggressive actions about the trade wars. And in Japan, I don't think it's immediate, but because the Section 232 didn't hurt our bottom line because we just passed on to the business partners in the United States to export our steel because it's a specialized steel. So we can pick up the pricing easily. But that hurts eventually consumers of the United States. And plus, if the US will additionally impose the tariffs on automobiles, that would be a big threat. And if that happened, we would impose countermeasures to the United States. And that would ruin, that might ruin the longstanding relation, trust, which was built over 70 years. So that is a huge issue because automobiles is the staple. It seems that the current administration in the White House has done something which no previous administration has done, which is that they've taken the economic issues, the trade issues, which have always been contentious. And they've put them in the same pot. They've conflated them with security issues, with things like the fact that the American military forces are stationed in Japan and defending it and the US security treatment and what's going on with protecting from North Korea. Now that's really raising the stakes. How is that seen in Japan? Considering national interest, doesn't Japan is ready to make certain concessions, such as agriculture? As long as it's within the scale of the TPP agreement we had, remember, we just decided to go for it. As long as it's within the scale, we are ready to discuss with the Light Heist, for example. But it's because of the national interest implication. Definitely, we are under the strong support of the military from the United States. By far, they have the strong power. So the security issue is very important. But in case of automobile, I would say we have to do something because we have domestic constituencies who might not be able to understand the national interest and security interests so well. For example, Okinawa, it's a huge issue. Okinawa people have the long history. Okinawa being an island with a very large military base on it. Yes, it's very hard to convince constituencies like farmers. Once they were convinced by TPP rules, which means we just opened the country for US such a livestock, it's decided. But if furthermore, we call the food security interest of Japan itself. So what is the border? And the US is approaching the border of whether we should take countermeasures or retaliation or not. I think initially, under the Trump administration, that tariffs were threatened under the Section 232 case on steel and aluminum, I think the expectation was that that would be really useful negotiating leverage the other country would come to the table and we'd be able to reach a negotiated solution and the US would be able to get a better deal by withdrawing that threat of sanctions. But what happened, I think, was unexpected and that was a number of countries around the world. They just refused to negotiate and to make concessions with that threat hanging over them. Some countries chose to counter retaliate against the United States like the European Union and Canada and Mexico. Japan chose not to, but I think what it demonstrated was that once these tariffs go into effect, they're really hard to take away, to remove and those tariffs remain in effect and so does that counter retaliation. And that's what really worries me about this US-China trade war as it escalates and more and more tariffs are put into place because I think it's gonna become more and more difficult to remove these tariffs. And I think that the expectation for the agreement, any negotiated agreement that is reached, let's say between US and China at some point and hopefully there will be a negotiated agreement that the expectation will be, well you took us to the brink of a trade war, what did you get for it? And so it puts a lot, it raises expectations of how comprehensive and meaningful that agreement needs to be. So I agree with what, how Tim started out. This is a really concerning situation in the international trading system and it's not just a war between the US and China, it's spilling over to other countries. It's a really interconnected world and I thought you, there must be another Navarra quote saying how bad global supply chains are somewhere but in reality we have a world with global supply chains and so the effect of all these tariffs, they're not just limited to the two countries that are counter-retaliating against each other. Yeah, two points. Such as the deal between the United States and Korea and the deal with Mexico. That show, both the deals show US won and they were defeated. So that's a huge threat to us. So US might impose automobile tariffs on our export. Despite the fact that we invested to the United States and the US investment from Japan created already surplus. Despite the fact that we have the huge surplus to the United States but investment from Japan to US generates cash more than their deficits from Japan. So I appealed to the US government about that but they don't listen to it so we might have reduced investment to the United States and instead we just like China, we just wanna keep our country to be invested by ourselves because it's not the praise of all. Second thing is having said that I think we definitely don't want to escalate this trade war with the United States and the IFR, fair, free, fair, reciprocal trade deal will start between US and Japan anyway. It is, I mean it would be my prediction that at some point President Trump is going to declare victory. He's gonna say, I won, they lost because I'm a better negotiator than anybody in the world. The question is, what kind of a deal would it need to be, do you think, to get to that point? How difficult would it be, Wendy? Between the US and China. Yeah, that's the starting point. I mean, I know the US is declaring trade war on pretty much everybody and trying to fight a war on many fronts which has worked out badly for people in the past. I don't think Napoleon had much fun with that. Sorry. So my view is eventually, and I'm not, I don't know what the timeframe is, but there will be a negotiated solution between the US and China. I think you will need to have several different, what I would call buckets, with some short term confidence building measures, maybe in the market access side of the relationship, but then longer term outcomes on how to deal with industrial policies, with subsidies, with over capacity, with other types of financial assistance. And I believe that the way you can deal with those issues, it's gonna require both sides to show flexibility, meaning the United States can't insist that China just dismantles industrial policy. That's just not gonna happen. But I don't think China can deny that its industrial policies have effects on its trading partners and harm the trading system and harm its trading partners. So I think the negotiated solution will need to be centered around how to ensure that these industrial policies don't harm China's trading partners. So that may mean having rules about the types of subsidies, the magnitude of subsidies that can be used, the need to provide non-discriminatory access to these subsidies, measures to prevent over capacity in the world, which as we've seen with steel and solar panels has had a huge impact on those sectors. And so I just think that's where I see the negotiated solution, if one's going to be reached. Both sides need to show flexibility and both sides will need to really have a serious discussion on how to shape those rules in a way that allows China to keep its industrial policies, but to make sure that they don't distort the international trading system and don't cause harm on China's trading partners. If I could just add, if you think... Before you do that, can I prepare the audience for the fact that as soon as you've finished, we're going to invite questions from the audience. So if you can think about what you want to say and raise your hands quickly when I ask, you'll get in first, sorry. If you think about the technical difficulty with what Wendy's described, you have to do this across a whole range of industries, so you have to figure out what the right compromise is. If you're a trade negotiator from your country, you have to consult with your industry, you have to consult with Congress, you have to get interagency approval for the positions you make, and then you have to do this across a wide range of industry sectors. So that simply takes a lot of time and a lot of bandwidth to do that, and so that's one of the things we have to keep in mind. Another thing we have to keep in mind is how difficult is to write rules that would actually be effective. China, for example, has not regularly reported its subsidies to the WTO the way it's required to do, and so even if you have a commitment that says you're only supposed to do certain types of subsidies and not be on a certain limit, frankly, China hasn't really been very good at reporting what it's actually done. There is a tremendous amount of administrative discretion in the way the Chinese economy operates, and so what happens is administrators can make decisions that go against the spirit of what a bilateral or a multilateral agreement would have said. You don't have hard evidence to show the basis of the decision, and you also, frankly, have companies that feel intimidated and don't dare complain because then the next time discretion is exercised, it will be very much to their disadvantage, and so these are some elements of the Chinese system that have made some of the WTO rules not really work. Well, it's also very easy to disguise subsidies, right? I mean, if you have a big pot of money that explicitly says the government is giving you this, then it's obviously a subsidy, but if it's just that the government implicitly stands behind a state-owned bank which therefore can borrow lots of money and which then maybe channels it to slightly favored companies, that's much harder to put your finger on. So if the government of China really believes that a more market-oriented approach is in its best interest, then these things won't happen, but if they're forced to the table and forced to sign things that they really don't believe are in their own best interest, then one could worry that it actually might not turn out as well as one would have. Well, that's what we learned with Japan. Right, right, just the last thing. Just the last thing. Really quick one? Right. Okay, and then... My concern about the business itself and it's been affected by the district wars and the plus because of the capital flights from emerging economies, that promoted to worsened the other economy in terms of its landscape to be. So I urge the Chinese leaders to open the country more just like Premier Li mentioned today and the solution is open the country furthermore. That is an excellent idea. Can we have a microphone down? There was a gentleman behind there and then, lady there. Hello, thank you for the presentation. I'm Gerald Tamura, professor at Kaio University in Japan. Thank you, I really enjoyed the talk. Just to make the question simple, trade imbalance is, of course, it happens because it's one sided and the healthy balance would be to have exports and imports. So as Gerald mentioned, China is doing an industrial policy and there's a systemic difference. So to solve this kind of problem, instead of just going through this tariff war, I think like Tim has mentioned, the systemic difference, we have to really get into the systemic difference. I think we did that in Japan, as Nina Misano just mentioned, that Japan went through this 20, 30 years ago. We were called the industrial policy country and we started to change to a competition-oriented country. Now, my question is, maybe to all of you or maybe Tim, first, is will China be willing, as like Nina Misano said, open the country, different football rules, more converged to a similar rule because I believe that trade and competition should be harmonized, converged, and that will really make the world really more free and fair. Okay, great. That would be the most straightforward solution, but when I talk with Chinese officials, it seems that the preponderant view right now is that the sort of industrial policies found in Made in China 2025 are in China's own best interest. Now, there are certainly dissenting voices, but right now it seems that those dissenting voices are a little bit quiet, and I think the more hostility arises in the bilateral relationship, the more those voices will think that they need to remain quiet as well. So I think that's part of the challenge of creating the right sort of context so that you can have open discussions about what really is in China's best interest. So you think that actually by threatening and saying you've got to do these things, it makes it less likely they're going to happen? Well, what it means is that we're not yet at the negotiation phase where we can have that conversation. I think that there are some views of how negotiation should take place that say you should go through a period where everybody's angry at each other and then you calm down and then you're able to approach the negotiation in a different place than you were at the beginning. And I think we're seeing some of that philosophy. Okay, let's have the lady in the front row there and then one in the back if we could get a microphone over there as well. Okay, please. Thank you, wonderful discussion. I'm Christina Lampion Road, CEO and founder of Cadenza Innovation, a tech pioneer and really interested in your perspective in how we fight climate change. Climate change doesn't have a passport and make it to very tactical and specific. My company has invented a technology with energy storage that is cheaper, safer and more compact than what we know today. It's ready for commercialization. We've decided from the United States to license globally. What's your advice when all countries are basically closing their borders where we have a very skilled team behind a technology that can be deployed? How would you consider what advice to operate? Who would you like to put that to? I would say the panel in general. Who wants to answer? Yeah, well, we have the same issue. However, we just work on a lot of the European leaders. As a matter of fact, they listen to us. And WEF is one of the institution for us to promote how to resolve the issues of the global warming. Such as in September, Chairman and CEOs of the World Economic Forum gathered how to resolve those issues. But first of all, it's not business at first. But definitely it should make sense, economic sense, as long as it's sustainable. So all business leaders get together to work on how to resolve the issues together crossing the borders. That is happening at welfare events. And I think we have to leverage and we have to go to the UN and so forth. And we're working on it. So I definitely believe this kind of function, this kind of event helps to cross the borders. Maybe I could comment. Amcham China, Amcham Shanghai just did a survey about how the tariffs and the threat of additional tariffs is affecting business decisions. One of the things people are doing are re-assessing their sourcing decisions, re-assessing which markets to focus on, and they're delaying some investment decisions if they can. But one of the things that they're doing if they have to make decisions right now are putting manufacturing in a third country that isn't subject to tariffs either on the Chinese side or on the US side, because that way they're sort of in a neutral location and they can feed into both markets. So that's one strategy that people are thinking. I mean, it depends on whether you're looking at licensing arrangements or setting up manufacturing facilities or something. And what they're not doing is deciding to build plants in America the way Japanese companies did with cars in the 80s. Well, if you build in the United States, you're not sure that you'll be able to export back to your home market in China if you're a Chinese company. So it's complicating the investment decisions of companies right now. I want to ask a question about what is the real intention strategy? Can you introduce yourself, please? This is, you know, I'm coming from US-based investment company, Invesco. Okay, I want to ask a question about what's the real intention behind for this trade war? People, there's so many different speculation in the market, you know, trade imbalance, you know, intelligence, technology intelligence, national security, there's so many different reasons. I want to ask your perspective, what's the real reason behind? I want to give two perspective first. The first one is about, if you pay attention to the news that US asked for like 100 different processes, you know, changes for the trade relationship with China. China said, you know, 20 of them are non-negotiable. That means 80% of them can be negotiated, right? And China sent their deputy prime minister to the US right now for the negotiation. So if trade imbalance is real, a issue, should you at least discuss and negotiate first and then come back, well, you are not satisfying my needs, you are not fulfilling the requirement, so you need to give me some more. Instead of, you know, before the deputy prime minister make it to the US and you make this, you know. Okay, Wendy, you want to take that? Yeah, so, you know, what's behind the trade war? One issue I think we just need to keep in mind is that our trade problems with China didn't start with the Trump administration. That these issues were building up for a long period of time. And I worked at USTR for many different USTRs as these problems were mounting. Under the Obama administration and under the Bush administrations, we followed an approach of having these dialogues at very senior levels, the senior economic dialogue, the strategic economic dialogue, the JCCT, and under the Obama administration, we aggressively took cases to the WTO. Well, when President Trump came into office, his view was that these approaches just didn't work and we needed to do something different. We needed to get China's attention. And if you look at Ambassador Lighthizer's background, when he was at USTR in the late 80s, he negotiated a lot of these so-called voluntary restraint agreements with Japan, with Korea, where he threatened tariffs and then as a result, a negotiated solution was reached. So that's what we're seeing. We're seeing a pattern of, once again, threatening tariffs with the hope then that a negotiated solution would be found, as I mentioned earlier, that didn't happen with steel and aluminum. And now it seems that the president really is an appetite for continuing to escalate if the other side doesn't do what he wants to do, feeling that these tariffs will give the United States more leverage in a trade negotiation. Can I add one more point? Because I think what the US motivation is is a very important element. And more and more of my Chinese friends are concluding that this is done because of an overall hostility of the United States towards China, that the United States is jealous or fearful of China's rise and therefore that it's part of a containment strategy. Now I can tell you that when I was responsible for US trade policy for China from 2005 to 2010, never once was this idea ever a part of our discussion. It was all focused on what is the appropriate economic policy to promote growth in all of our countries. I'm quite convinced that today in our economic agencies in the US government, USTR, Treasury and so on, that there still is a focus on economic policy and not an overall drive to contain China. Now there may be some voices in the United States that are talking in more hostile terms, but I don't believe that that's what's driving these economic discussions. I think it's very important for the Chinese side to understand that. I think I had a great chance for China to attract other countries like Japan. For example, good, I mean goods, how to reduce the tariff in terms of the border adjustment. And I think now is the time for China to appeal to ASEAN countries, other countries. We will lower the tariff as your premier mentioned today. I think that should happen. Then we can talk to China and China will lead the free trade, even though it's not a high standard, low standard, but I think China will take a lead for that. I think now is the right time for China to do it. Great, let's have a question at the back there. So technology and IP were mentioned as well as Dataflow. Can you tell us who you are, please? My name is Pranayanaarang. I'm on the faculty at Harvard. I'm a scientist and here as a part of the young scientist community. So I was wondering how agreements in future will handle emerging technologies, in particular quantum technologies, quantum computing that have a very clear national security component, but are also technologies that both China and the U.S. are investing heavily in. I think the National Quantum Initiative was just passed by the House. So just wondering how will agreements in future make sure that we are not behind again in terms of what we do with new technologies? Thank you. Everyone on the panel I guess. Yeah, so I mean you put your finger on a really tough issue in trade and that is that trade negotiations take time and given how quickly technology is changing, it's so hard for trade agreements to keep up with this technology. If you think the TPP took five years to negotiate and it will come into effect probably early next year, this is about eight years later, without the United States, but among the remaining 11 countries. And then you think about the chapter on digital trade which was negotiated about seven years ago was really on the cutting edge of dealing with really important dynamic issues. And now frankly that chapter's getting older and we'll see that in NAFTA because the NAFTA negotiations have updated the digital chapter from TPP. And then when you start talking about these, going beyond digital to the technologies of the fourth industrial revolution, we're gonna have a lot of challenges in the trading world dealing with as you mentioned, how to deal with the whole issue of national security which has always been viewed as an issue that the WTO just does not want to adjudicate on. Second, you have the issue of what is a good and what is a service? Because trade rules and trade agreements are basically written, your rules on goods and then your rules and services. Well, what do you do with 3D printing? What do you do with additive manufacturing? Is that a good or is that a service and which rules would apply? And then you have, in addition, the whole issue I mentioned in the beginning, just the fast-paced dynamism of these technologies and the slow pace of trade negotiations. So I think these all produce challenges in a paper I produced for this web forum. What I suggested is that the WTO assigned like a group of really senior kind of trade experts to really look at these issues and offer their recommendations on how these issues can be dealt with or else the WTO is gonna find itself really at a loss as these new technologies comprise more and more of the global trading, of global trade between countries. Thank you. If we're gonna finish on time, I think we've got time for two more questions but I can ask them to be put, simultaneously, well, one after the other and then answers and I want them to be short, please. So if we could have one here and one there, please. So get two microphones, one down there, please. Thank you. Question about US politics. So there's already enormous pressure being brought to bear in the president from states like Ohio where a million jobs depend on trade with Canada and the other 35 or something states for whom Canada is the number one trading partner against walking away from NAFTA and increasing tariffs. Given all of this pressure, increasing pressure that's going to come from industry and consumers and then the possibility of a wave election in November. If all of that comes together, do you think that could have a moderating effect on the president's policies? Great question, final question there. Is there any specific from US point of view? Is there any specific area of industry US want to just really hang on or gain some ground or some certain industry you'll find to yield? Do you have any sense? Okay, possibly the first question, the midterms, the wave, who wants to take that? I mean, let me, I can take it quickly. I think it's possible that these tariff wars and the people hurting from it up until now it's been largely US companies and their workers, but soon with this $200 billion worth of tariffs you're gonna see more and more consumers hurt. So I think that will lead to many unhappy people in the United States and we'll have to see how they vote in the midterms and it may have a moderating influence on the administration. However, the president has been pretty clear when companies come and complain or consumers complain that in his view he thinks he's doing the right thing and he thinks that maybe short-term pain is worth it if we're gonna get these issues right in the longer term. With respect to NAFTA, we're really coming up against the wire if the negotiations are gonna be concluded by the end of the month. We have a bilateral agreement in principle with Mexico negotiating intensively with Canada. I believe that Canada will find a way to bring Canada into the fold by the end of the month. That's what I'm saying, Tim. On the second question, I think the US doesn't have clear industrial policy priorities the way China has with policies like Made in China 2025. One place where you can get some clues and it's a little bit of an answer to the other question about national security. The US has just enhanced its inbound investment review process that's called the CFIUS process. They've just enhanced it and they've said that they will have special scrutiny of particularly sensitive or strategic industries and so as we see how the CFIUS Committee interprets that, we'll get a sense of which technologies they think are particularly sensitive and therefore they wanna watch who's buying the technology and taking it out of the country. The other thing that the US has done- If they think that steel is a big national security issue, it suggests they're gonna interpret it quite brightly. Look, the CFIUS process is an interagency process that's focused on national security and it really has been focused on national security and I think the reputation of the Committee for those who've been working closely with it is pretty strong and they've tried to have a narrow definition of national security. Commerce Department in having these 232 actions and saying that importing cars from our treaty allies is a threat to US national security, that's a completely different game and I think trade policy experts are groaning about that because when I came to China, I tried to persuade China to have very narrow definitions of national security in terms of our trade relationship and I'd hate to come back now and try to make the same case when they've said, well, you think importing cars from your treaty ally. The other thing I wanted to say is that the US has also just passed Export Control Enhancement Act and the Commerce Department's gonna be coming out with draft regulations as soon as next week that's going to identify some particularly sensitive technologies and the US is gonna be looking a lot more at licensing agreements and other ways that those technologies go out. I'm gonna give the last word to Tak. Right, as for CFIUS, Japan is pressured by the United States and we are studying how to deal with the CFIUS things because we are allied nations but we got to think about the high technology like things that we are talking about the CFIUS and going back to the technology, national security, what kind of national security you were talking about but kind of fused ripple effect from the United States is going to the allied nations as well. Second thing is I think as for the Trump who remembers so much about the 60s, the 70s, the trade wars with the United States, I mean between the United States and Japan, he might not just, you know, drop out of the sticking to this trade war by the threat, I mean, tariff threat even after the midterm election and even after he would be elected. So he's, I think, nurtured by the trade wars. That's my perspective. I'm afraid that's all we have time for on this topic that everyone seems to find terribly fascinating. So I hope you can join me in thanking our distinguished panelist, Wendy Cutler, Takninami and Timothy Stratt. But thank you very much indeed. Thank you.