The World Trade Organization has urged its members to resist protectionist sentiments to help steer out of the slump in global trade. 

A rising wave of protectionist policies around the world has contributed to a global trade slump, says the World Trade Organization (WTO) in its director-general’s mid-year report on trade-related developments issued in July. According to the WTO’s Trade Policy Review Body, from October 2015 to May 2016, 22 new trade-restrictive measures were put into effect by member states per month. This represents the highest monthly average since 2011.  

WTO director-general Roberto Azevêdo urged members to resist protectionist measures and “get trade moving again”. “We hope that this will not be an indication of things to come, and clearly action is needed,” he said. According to the report: “Out of the more than 2800 trade-restrictive measures recorded by the WTO since October 2008, only 25% have been removed.”  

“In the current environment, a rise in trade restrictions is the last thing the global economy needs,” Mr Azevêdo stressed. This increase could have a further chilling effect on trade flows, with knock-on effects for economic growth and job creation.” 

A combination of low commodity and oil prices, continued slow recovery in developed markets, and political developments indicating backlash against economic globalisation are all factors in the trade stagnation. Anti-free trade and protectionist rhetoric is on the rise, exemplified by the Brexit vote and the growing popularity of American presidential candidate Donald Trump. 

This article is sourced from fDi Magazine
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