The Obama administration has launched a “21^st Century” trade negotiation with a number of pacific-rim nations referred to as the Trans-Pacific Partnership (TPP).  While the full details of the proposed treaty are yet to be made public, early estimates show that the economic benefits of the agreement will be relatively small and the regulatory costs could be significantly high—especially for the emerging market and developing countries engaged in the negotiations.

The gains of the agreement may be a mere $20 billion, or just over one percent of GDP on average for the nations involved.  To get those small gains nations will have to trade away the ability to use measures to prevent and mitigate financial crises, to develop a growth-based innovation system, to protect public health and the environment, and more.

That’s right, according to a study by the East-West Center, at best the agreement will bring a one-time boost in GDP to participating countries of just over one percent. The accompanying table to this note shows how these gains would be distributed.



Vietnam and Malaysia seem to stand to gain more than half the benefits of the treaty, but those two countries would likely have to bear the most in terms of regulatory cost.  Both of these nations are significant low-wage assembly manufacturers that would export more goods to the US and Australia, and also import more intermediate goods for final assembly from those and other TPP nations.

These gains should also be seen as gross over-estimates as well.  The models deployed by the authors have estimates not only for goods trade, but also for services trade, and for the amount of foreign direct investment flows to the region.  The methods for the latter two estimates have little traction in the economics profession and are often not reported in official reports by the World Bank and others. Indeed, work by myself and others show that such models should be viewed in a very critical manner.

These over-estimated but still small benefits need to be juxtaposed with the costs.  The provisions for investment and intellectual property will bring significantly high costs to these nations.  What is more, the treaty will divert trade that probably should occur among others worse off.

In terms of investment, the treaty would rob the ability of parties to deploy regulations on the flow of cross-border capital flows to prevent and mitigate financial crises.  Such regulations are a cornerstone of Vietnam’s exchange rate and export policy.   Malaysia’s regulation of capital outflows in the wake of the Asian financial crisis is credited with making Malaysia among the least worse off due to that crisis.  If these tools were used, the treaty’s “investor-state” dispute system that allows private firms to directly sue host country governments would kick in.

The agreement will also make it harder for nations to establish the appropriate innovation policies that are necessary to diversify the economy toward higher value added goods.  While nations like Brazil and China—with only commitments under the WTO and not a deal with the US—are free to learn from foreign firms and spur domestic industries, this will be much more difficult for nations under its deal with the US.

Finally, the agreement will make other area nations worse off.  The treaty will distort markets in the Asian region such that Indonesia, the Philippines, Thailand, Japan, China, and South Korea would all be worse off.

Prominent trade theorist Jagdish Bhagwati has said that if TPP nations accept this deal they will truly be “bamboozled.”  When looking at the potential gains and the real costs it is hard to come up with a rival conclusion.

The concept of competitiveness has attracted a lot of attention by scholars, policy makers and international economic institutions in recent decades. But it suffers from some misconception when applied to developing countries. In a forthcoming book, Competitiveness and Development: Myth and Realities (Anthem Press), I have explained that developed countries have been concerned with competitiveness at the high level of development by undertaking, inter alia, technological development and upgrading of their industrial and service activities. Yet, they have been imposing competitiveness at the low level of development on developing countries. They have been doing so, by advocating neo-liberal views, e.g. through Washington Consensus, and imposing across-the-board and universal trade liberalization on developing countries through International Financial Institutions (IFIs) and WTO, and regional and bilateral trade agreements.

To explain, there are two different approaches to competitiveness: static, advocated by neo-liberals and dynamic, which is the concern of ne-developments.  The static version is cost/price led, based on the theory of static comparative advantage, and the allocative function of the market forces. This theory relies on unrealistic assumptions-such as the prevalence of perfect completion, constant return to scale, and independence of present and future costs. Further, firms are assumed to be small and strategically passive; there are no barriers to entry, no externalities, no industry specific learning etc. Accordingly, economic policy should concentrate on macro-level issues e.g. wage cost and exchange rate-despite the fact that the empirical evidence shows that the level of exchange rate can be the result of competitiveness rather than its cause-a la Kaldor paradox.

In a world where production and international trade are characterized by economies of scale, barriers to entry, imperfect competition, and are influenced by the strategic behavior of large firms; being competitive in the static sense would involve production at low value added, and employment and the loss in terms of trade.

In reality, at the firm level, competition is a dynamic process of creative destruction, in its Schumpeterian sense; firms move from equilibrium to another rather than moving towards equilibrium. Each firm has different capabilities and gaining market share alone is not its objective. There are usually other objectives such as increasing profitability, productivity and real income. Innovation and upgrading of the production structure to demand dynamic and supply dynamic activities is essential for maintaining or improving competitiveness and increasing value added. The firm is a driving force in economic activities; it takes strategic actions, shapes the market and competes with other firms also on non-price factors. It acts as a coordinating agency and interacts with other firms, market, consumers, institutions and infrastructure and international environment. It is further influenced by government activities and strategies.

At the national level competitiveness is to be an element of development and the basis for nation’s standard of living; it should contribute to growth, value added, employment and high returns to factors of production.   Competitiveness at a high level of development cannot be achieved through specialization based on static cost comparative advantage. Such specialization will lock low-income countries in production of primary commodities, and at best assembly operation making them competing at a low level of development. It requires creating supply capacity in high value-added activities, making the developed capacity efficient and continuously upgrading the industrial structure. None of these can be achieved through the operation of market forces alone. It also requires proactive and conducive government policies and strategies.

The book explains the international context and conditions under which competition takes place; highlights deficiencies in the neoclassical theory of competitiveness; surveys alternative theories and develops on a framework of analysis outlined above by expanding on the principle of dynamic comparative advantage. In doing so in addition to applying the Schumpeterian approach to competitiveness, I have benefited from theories of productive power of F. List, competitive advantage of M. Porte and M. Best and, business organization of W. Lazonick. I have also benefited, inter alia, from the Kaleckian approach to the acceleration of supply capacity and the theory of Capability Building.

Possibilities for and constraints in achieving competitiveness at the high level of development by developing countries are examined. It is emphasized that in order to be able to enhance their policy space, developing countries should appreciate their need for dynamic and flexible trade and industrial policies. To be able to pursue such policies, changes are necessary at the international rules and regulations of WTO and IFIs and in practices of developed country donors in their bilateral and regional trade agreement with developing countries. The important role of government policies and practices is illustrated, in the book, by comparing contrasting experience of China and Mexico since early 1980s, and its implications for other developing countries.

The World Trade Organisation’s Ministerial Conference was held in a calm and relaxed atmosphere in Geneva last week.

Past WTO ministerials had been tension-filled, with some Ministers (usually from developed countries) often aided by the Secretariat, trying to push for mandates to launch talks on new rules or treaties, and Ministers of developing countries resisting.

The decisions would be made by a small group of 20, usually selected by the Secretariat or the host Minister, and there would then be great tension to as to whether the whole membership would agree to what the small group of 20 had decided. Sometimes the small group could not agree among themselves.

Thus, WTO ministerial, or more recently “mini-Ministerials” of 30 or so members, could end in induced success or inglorious failures, with the failures exceeding the successes.

In the past two to three years, these tensions have instead been absorbed by trade negotiators and their senior officials in an endless series of informal and formal meetings in Geneva, rather than by Ministers in a conference.

These meetings have made it evident that there is no agreement on how to conclude the Doha talks launched in 2001, nor on what the WTO should be doing in the next few years beyond its regular work.

To avoid another tension-filled Ministerial, the diplomats designed last week’s Ministerial to be a simple combination of formal speeches and informal discussions among the Ministers.

There was to be no Ministers’ declaration and thus no intense negotiations over texts. At the end, on 17 December night, the conference Chairman, Nigerian Minister Olusegun Olutoyin Aganga, presented his own Chairman’s statement. The first part was on what the diplomats had already prepared before hand, and the second part summarized the Ministers’ discussions.

However, below the meeting’s calm surface, deep differences of views were evident both on the Doha impasse and on the way forward.

All profess to be still committed to concluding the Doha agenda. While most want it finalized based mainly on December 2008 texts on agriculture and industrial goods, the United States wants the big developing countries to open up their markets by even much more than that, which the latter do not consider fair.

Most developed countries have proposed a new method for Doha, that the talks and outcomes on some issues be conducted on a plurilateral basis (involving only those members that are willing).

But this was firmly rejected by a hundred developing countries which in a statement (entitled Friends of Development) said it went against the principles of multilateralism and inclusiveness.

Another proposal is to have an “early harvest” of some issues first rather than wait for all issues to be agreed on. Though many countries are amenable to this, there is no agreement on which issues should be “early harvested.”

Earlier this year, a quest to announce an early harvest at the Ministerial failed. Almost all members agreed there would be a “package” for least developed countries, so that Doha could deliver results first for the poorest members.

However, two of the key issues (duty free market access for LDC products and reductions in cotton subsidies) were not acceptable to the United States.

Next year when the Doha talks resume, developed countries want a trade facilitation treaty to be an early harvest. But most developing countries insist that any early harvests should be on their development issues, including an LDC package, enhanced special and differential treatment and resolving problems arising from implementing the WTO agreements; as well as reducing agricultural subsidies.

In the Ministerial discussions on issues not on the Doha agenda, there is also a deep divide. Developed countries want to launch discussions on new issues, possibly leading to new rules.

These include investment and competition (which had already been discussed for years but then removed from the Doha agenda in 2004), climate change, energy security and food security.

However, a majority of developing countries were opposed to a top-down introduction of new issues. The “Friends of Development” declaration said that any trade-related issue should be discussed at appropriate WTO bodies in accordance with due process and consensus.

Many also believe that introducing new issues now would distract from the development components of the Doha agenda, and that the proposed issues are not in the developing countries’ interests.

Instead, the developing countries proposed work to enhance the development aspects of the WTO, including strengthening the trade and development committee and having a development review of the special and differential treatment provisions of the WTO.

The Ministerial conference was conducted in a friendly and relaxed atmosphere, but the underlying differences and tensions will still be there when the WTO resumes work next year.

This piece was originally published at the Third World Network.

The WTO ministerial meeting in Geneva last week failed to take any decisions on the question of food security. Indeed, we knew this would be the outcome even before the meeting began. As the ICTSD reported, two proposals on food security – both calling for exemptions from export restrictions for the world’s least developed and net food importing developing countries and for humanitarian food purchases by the World Food Programme – did not gain sufficient support at the WTO General Council meeting in late November to make the Ministerial agenda.

The fact that WTO members could not even support discussion of these specific measures does not bode well for the adoption of a broader and more comprehensive food security agenda at the WTO.  The disagreements over rules on export restrictions have in fact served as a distraction from the broader food security issues that the WTO is already supposed to be working on.

The original Doha Agenda included negotiations on sweeping reforms to the 1994 Agreement on Agriculture, in particular to give special and differential treatment to developing countries, with a view to promoting food security. This was clearly spelled out in the agricultural work program of the Doha Declaration back in 2001 when the trade round was launched. It is worth quoting here to remind us how central it was to the original aims of the Round:

“We agree that special and differential treatment for developing countries shall be an integral part of all elements of the negotiations and shall be embodied in the schedules of concessions and commitments and as appropriate in the rules and disciplines to be negotiated, so as to be operationally effective and to enable developing countries to effectively take account of their development needs, including food security and rural development.”

In the decade since the Doha Round was launched we have seen major upheavals on world food markets, with soaring and highly volatile food prices that have been especially hard on the world’s poorest countries, most of which are highly dependent on food imports. As the FAO noted in its most recent Food Outlook, higher food prices in 2010-2011 increased the food import bill of the world’s least developed countries by over one third from the previous year.

In this context, advocates of trade liberalization have been quick to blame export restrictions as a principal cause of food price spikes and rising hunger. Such restrictions have undoubtedly exacerbated the situation in the short run. But the causes of rising food insecurity run much deeper and have longer term causes that themselves are not unrelated to WTO rules on agricultural trade – the very rules that the Doha Round was supposed to correct.

The developing countries that are dependent on food imports today were net agricultural exporters in the 1960s. Somewhere around the mid-1980s the situation reversed itself and today they rely on trade for around one quarter of their food consumption. What was the cause of this reversal in the agricultural trade balance? Declining agricultural investment was part of it – not just a decline in domestic investment in developing countries but also a dramatic drop international agricultural assistance. Why did this investment drop? In large part because cheap food was available on world markets, thanks to high subsidies in the rich industrialized countries.

This pattern was reinforced by the 1994 Agreement on Agriculture under the Uruguay Round which enabled the rich countries to keep their high subsidies while further prying open markets in poor countries that had already been forced to liberalize their agricultural trade under World Bank-sponsored programs of structural adjustment in the 1980s. As the UN Special Rapporteur on the Right to Food, Olivier De Schutter said in a press statement during the recent WTO Ministerial: “These countries are caught in a vicious cycle. The more they are told to rely on trade, the less they invest in domestic agriculture. And the less they support their own farmers, the more they rely on trade.”

What is really needed is a serious discussion in the WTO on how to reduce the dependence on food imports and rebuild resilient agricultural sectors in the world’s poorest countries. The early years of the Doha Round in fact had serious negotiations on this question. In seeking to protect themselves from surges of cheap imports that harmed the livelihoods of their domestic farmers, developing countries have been calling for robust safeguard mechanisms to be incorporated into the Doha Agreement . They have also been pressing the industrialized countries to reduce their farm subsidies. But the major agricultural exporting countries – the US, Canada and Australia, have fought hard against a strong safeguard mechanism for developing countries, and the subsidy cuts agreed thus far have been only minimal. In fact, this foot dragging on agriculture is a major reason why the negotiations have been stalled since 2008.

Addressing volatility in food prices is certainly important, and adopting specific exemptions from export restrictions is perhaps one way to alleviate the effects of price spikes on the world’s poorest people in the short term. But such measures – even if the WTO members could agree on them – should not distract us from the bigger picture. We must remember that the root causes of food insecurity are themselves not unrelated to the existing highly uneven WTO rules on agricultural trade, and that the original aim of the Doha Round was to level the agricultural playing field. This original WTO food security agenda should be brought back to the forefront of the discussions.

Agricultural Trade Balance of the Least Developed Countries, 1961-2006

Graphic reproduced from Jennifer Clapp, Food (Polity Press, 2012).

See also Kevin P. Gallagher’s recent work on the future of the WTO in an essay for International Centre for Trade and Sustainable Development, “The Challenging Opportunities for the Multilateral Trade Regime.”

Signs of a New World Order are everywhere here in the French Riviera, as the elite city of Cannes hosts the G20, the ultimate elite club. The local business rag, the Riviera Times, trumpets a recovery of the tourism business during the 2011 summer season – thanks to a 50 percent increase in visitors from China.

In my hotel lobby there are stacks of China Daily, but no such freebies from the newspapers of the Old World Order powers. Walking by the kiosks, though, I see European headlines rejoicing at the likelihood that China will aid in the Greek bailout. The head of the European Financial Stability Facility, the pot set up to rescue basket case countries, traveled to Beijing last week and rattled a tin cup for donations from China’s $3 trillion reserve fund. This comes amid news that Chinese investors have acquired distressed Swedish carmaker Saab. (They already own Volvo.)

How will China’s juggernaut status affect the G20’s agenda?  In both positive and negative ways, in my view. On the positive side, they could hold some of the other governments’ most extreme free market tendencies in check. Take, for example, some of the positions the Obama administration is pushing in bilateral and regional free trade agreements. In the recently signed treaties with Panama and Colombia, they pushed through new rules that ban the use of capital controls, despite the fact that many countries are using these policy tools to combat financial volatility and the International Monetary Fund is recommending them in certain circumstances. The Chinese government, a capital controls user, would never go along with it if the Obama administration tried to push such nonsense at the global level.

In the nine-party talks for a Trans-Pacific trade deal, the Obama administration is apparently pushing for a rollback of Bush administration concessions to allow greater access to affordable medicines under the intellectual property rights rules of trade agreements. According to a Public Citizen analysis of leaked position papers, U.S. negotiators are seeking to increase the rights of pharmaceutical firms to challenge policies of New Zealand and Australia that are designed to keep down drug prices. Again, China would be highly unlikely to roll over if the U.S. pharmaceutical industry tried to obtain such rules at the global level.

On the down side, China’s tremendous power will likely mean that all the G20 rhetoric to address current trade imbalances through “sustainable and balanced growth” will come to naught. In a Financial Times commentary, President Barack Obama repeated the mantra that “for countries with large surpluses, it means working to boost domestic demand. A critical tool for accelerating that shift is greater flexibility in exchange rates, including exchange rates that are market-driven.” This is all just diplomatic code language meaning that China should expand social programs, let wages rise by respecting basic labor rights, and stop undercutting competition by keeping the renminbi undervalued.

Chinese officials have dragged their feet on all of these fronts. And with their newfound status as a global rescuer, they are unlikely to take action any time soon. Li Daokui, a member of China’s central bank monetary policy committee, told the Financial Times that the Chinese government might even condition their support for the Greek bailout on an end to European criticism of their currency policy.

It’s ironic indeed to see the Old World Order powers now so eager to benefit from Chinese reserve funds. These funds were, after all, accumulated through the aggressive export strategy that has so rankled the West.

Sarah Anderson directs the Global Economy Project at the Institute for Policy Studies in Washington, DC, and is a civil society observer at the G20 Summit in Cannes, France.

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Reports

Timothy A. Wise and Kevin P. Gallagher, U.S. Trade Policy: Still Waiting for a ’21st Century Trade Agreement’
Kevin P. Gallagher, Trading  Away Financial Stability in Colombia: Capital Control and the US-Colombia Free Trade Agreement
Kevin P. Gallagher, Trading Away Stability and Growth: United States Trade Agreements in Latin America
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Blog Posts

Kevin P. Gallagher, Trading Away Development: The US-Colombia Free Trade Agreement
Matías Vernengo, The Colombia FTA: Only Corporations Win
Timothy A. Wise, U.S. Trade Policy: Moving Backwards in the 21st Century
Kevin P. Gallagher and Timothy A. Wise, The false promise of Obama’s trade deals
Sarah Anderson, How Obama is to the Right of Reagan on Trade

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Timothy A. Wise, Obama Pushes NAFTA-style trade policy despite 2008 promise

Since the early 1990s Latin American nations have been signing trade treaties with the United States that have brought small gains and high costs. Pending deals between the United States and Colombia and the United States and Panama are no different. Each is based on the same template that has been the cornerstone of US trade policy since the North American Free Trade Agreement (NAFTA).

In a new paper I review estimates of the gains from trade from numerous Latin American-US free trade agreements (FTAs) from the 1990s to the present, and juxtapose such gains with the fiscal and regulatory costs associated with those treaties. The analysis shows that Latin American nations are signing deals where the net benefits are ambiguous at best. Indeed, estimates show that the US-Colombia trade treaty pending in the US Congress would yield negative net welfare benefits for Colombia, cost the Colombian government $633 million in tariff revenue, and force Colombia to deregulate its financial sector, and choke its policies for innovation and productive development.

If these treaties fall short of bringing real benefits to Latin America, then why do Latin American governments sign them?  Those nations that end up signing with the US usually converge around: having high initial export dependence on the US that accentuates asymmetric bargaining power on the part of the US; the dominance of right-wing political parties in Latin American countries at the time of negotiation; a “race” to gain access to the US before a neighbor with a similar export does; and a pervasiveness of “neo-liberal” ideas throughout elite decision-making circles in the nations that choose to sign treaties with the US.

Take Colombia for example.  Close to half of all its exports are destined to the US, and many of those exports come into the US through special preference programs.  The US told Colombia that they would lose those preferences if they did not sign an agreement.  Moreover, the US has a mammoth economy 116 times the size of Colombia’s with average income 17 times higher than Colombia’s..  As Albert Hirschman spelled out in his classic National Power and the Structure of International Trade, a negotiation with this type of asymmetry quickly becomes an offer the Colombians can’t refuse.

Like most Latin American nations that sign with the US, the Colombians didn’t want to refuse in the first place.  Indeed, the deal was negotiated with right-wing political parties aligned with domestic exporters who all share a commitment to neo-liberal economic policy regardless of its poor record in the region.  In my study I show that most treaties follow a similar pattern of the US teaming up with a right-wing government that can’t say no but they don’t want to say no!

A related factor is the collective action problem.  In these trade deals the benefits are highly concentrated in a handful of sectors but the costs are dissipated across the populace and into the future.  For instance, a cost of NAFTA-style intellectual property rules is the inability to put in place a proper innovation system for long-run development.  By their very nature many of the innovation policies that many countries want the policy space to deploy are policies to correct market failures so that firms and general welfare benefits can be created in the future. Thus, the beneficiaries of such policies are either small and weak or not even yet in existence.

Of course, Brazil is the counter example.  Brazil’s economic might is large enough that it presented a counterweight to the US when the US wanted a Free Trade of the Americas.  Moreover, the center-left governments there were aligned with domestic industrial capitalists who benefit from the fruits of Brazil’s innovation policies, and well-organized unions that depend on that industrialization for jobs and livelihoods.  Moreover, Brazil never fully plugged in to the Washington Consensus and large components of the Brazilian government and economics profession hold what would be considered heterodox views of economic policy.  Thus, Brazil broke off negotiations for a Free Trade Area of the Americas because deregulating intellectual property, foreign investment, and financial services would bring heavy costs to its growth prospects.

Is the governance of global economy conducive to growth, development and stability?

Would the coming G20 and WTO ministerial meetings remedy the systemic deficiencies? I doubt so.

A series of crises have hit the world economy during the last few years. There is a deadlock in the negotiations in the Doha Round. In fact, there is a lack of confidence in the governance of the global economy in general, reflected in the jump in the price of gold by over 100% between November 2008 and July 2011. Although the current economic recession is not as severe as that of the 1930s, it is the worse since then. Had the international community agreed on the proposals made by Keynes on the governance of the world economy and the establishment of International Trade Organization (ITO), the situation would have been different.

During recent years, the food crisis, fuel crisis, and financial crisis have been followed by a recession unprecedented since the early 1930s. Unemployment reached about 10% in the USA and exceeded 20% in some European countries; from peak to the tough, the index price of (non-oil) primary commodities and crude oil declined by 38% and 68%, respectively, and the Dow Jones Industrial Average fell by 52%. A number of European countries have faced debt crises affecting confidence in the Euro as a common currency of the EU. There is also a risk of double dip recession along with upheavals in a number of developing countries.

What does the global economy suffer from? The short answer: deficiencies in governance of the global economy, particularly the international trade system. The great depression of the early 1930s, followed by the Second World War, led the British parliament to initiate the so-called Beveridge Report and, in parallel, requested Keynes to come up with proposals for achieving economic growth, stability in economic activities and enhanced employment worldwide.

Regarding the stability in economic activities Keynes proposed two main schemes: stabilization of prices of primary commodities, putting the main burden of balance of payments adjustments on surplus countries. A surplus country would be charged interest by the International Clearing Union (a sort of international bank) and would be required to revalue its currency. Deficit countries (regarded as expansionist) were encouraged to devalue their currencies by 5 % a year, but it was not obligatory.

In addition to the commodity-price stabilization scheme, the draft of the Havana Charter for the ITO included a number of developmental issues such as employment creation, regulation of restrictive business practices and foreign investment, labour standards, and commercial policies.

The U.S. Congress did not ratify the Havana Charter nor the GATT, which were supposed to be a part of ITO and become operational together with IMF and World Bank. In the language of Professor Singer, the Bretton Woods system became “incomplete” and “distorted”. It was incomplete because it lacked the stabilization schemes and many of developmental issues included in the Havana Charter. It was distorted because the GATT regulations were full of contradictions and biased against developing countries – a situation which persists after changes made in various trade rounds, including the Uruguay Round. Moreover, in the early 1970s the fixed exchange rate system was replaced by a flexible one, adding to instability in commodity prices and economic activities. And the speculative activities in the financial and commodity markets have increased due to the introduction of derivatives and other financial instruments.

Furthermore, following the recession of early 1980s, the IMF and the World Bank introduced Structural Adjustment and Stabilization Programs, putting the burden of adjustment further on deficit countries.

Thus, not only has instability in global economic activities increased, but the current GATT/WTO rules are biased against developing countries. For example, despite the fact that in the preamble to GATT, trade liberalization is regarded as the objective of the GATT/WTO system, the power of government in international trade is to be limited, but not that of transnational corporations (TNCs). (In fact, government control over TNCs has been relaxed through TRIMs and GATS.) Manufactured goods are to be liberalized, but agricultural products are exempted. Imports of labour-intensive manufactured goods from developing countries are restricted. Moreover, development of new technology is to be protected through TRIPs, but development of infant industries is restricted. Above all, developed countries have not implemented Uruguay Round rules to which they have agreed or have not often complied with verdicts of the Dispute Settlements Body of WTO.

In a nutshell, the current GATT/WTO rules and the Bretton Woods system are not conducive to development and stability in global economic activities. There is an urgent need for modifications in the system, which will be discussed in my next blog.