Trade multilateralism need to be sustained in post Covid world: Think-tank

Economy


NEW DELHI: The spread of Covid that touches all continents will have serious implications for international trade and effective measures are imperative to sustain trade multilateralism.

“While economic, social and political life across the world got disrupted as a result of Covid-19 and is expected to unfold further in the coming weeks, months and may be years, it is having and will have serious ramifications across various sectors, international trade being a major one of them,” said Pradeep Mehta, Secretary General, CUTS International, a global public policy think- and action-tank promoting consumer welfare through trade, regulations and governance.

“Unless they are addressed in a balanced manner by taking into account all interests, trade restrictive measures and counter-measures may spiral into a slippery slope of protectionism. Other than immediate consequences such as loss of producer and consumer welfare, there will be serious damage to multilateralism, which has underwritten peace, security, stability and prosperity of the world since the Second World War”. “Can the humanity afford it to happen?” he remarked.

Loading...

He was moderating a webinar titled “What would happen to a world without the WTO?” having speakers representing various regions of the Americas. More than 100 stakeholders representing trade officials, experts, academia, civil society organisations, think-tanks and media from different parts of the Americas and the rest of the world participated in a lively panel discussion including interactions.

Presenting the impact of the Covid-19 pandemic on the global economy and trade, Fernando de Mateo, former Ambassador of Mexico to the WTO and Professor at El Colegio de Mexico, said: “While the global economy is expected to shrink hugely as an aftermath of the Covid-19 pandemic even under a most optimistic scenario, global trade will bear much more burnt. It is not expected to recover to its pre-pandemic level even in 2021.”

“While noting that various trade facilitation measures are showing positive results in reducing the time and cost of doing trade, which, in turn, showing positive impacts on trade volumes, necessary reforms for better functioning of the WTO are to be undertaken in order for the WTO to benefit all its members,” he argued.

Speaking at the webinar Chad Blackman, Ambassador and Permanent Representative of Barbados to the United Nations Offices in Geneva and the WTO, “The rules-based multilateral trading system continues to be the best option, particularly for developing and small island economies. While the WTO is an improvement of its predecessor, the General Agreement on Tariffs and Trade, it is not a perfect system.”

“The organisation had and continues to face some significant systemic challenges. Most importantly, the recent trade disputes between major members have put considerable pressure on the system to function in a better manner. Without the WTO, developing and small economies will face more challenges and it is this that forced them to call for reforms of the WTO by taking into account the current geo-political issues,” he added.

Drawing from the historical role that multilateralism has played in fostering global peace and stability, Rohinton Medhora, President of Canada-based Centre for International Governance Innovation, said that “the Covid-19 crisis has challenged the confidence in cooperation, which underlines trade. Not just the decline in the volume of trade, we need to understand how that undermined the values of the multilateral trading system”

“This lack of confidence in global cooperation is worrisome. This is expected to get reflected in future governance of the global health system including how the expected vaccine to prevent the Covid-19 is going to be administered. This is where the flexibility of the multilateral trading rules will be useful. We need to see how smoothly that is done,” he added.

Juliana Peixoto Batista, Researcher at FLACSO, Argentina and Cordinator, Red LATN, recalled the history of the WTO and how it has faced a crisis a decade ago, which reflected changes in world balance of power. However, today’s crisis in a pandemic context is happening without even a framework.

She underlined, “The WTO is a victim of its own success. The earlier consensus is now broken and in the present context it will be much more challenging to arrive at consensus. We may have to do away with the single undertaking principle but that will reduce flexibilities, which are needed more developing countries. In such a situation, how can we build trust when the system itself needs a new narrative and that should be based on distributional aspects of international trade”.

Alejandro Hara, former Deputy Director General of the WTO underlined the importance of the WTO’s dispute settlement system and why it should be revived and reformed at the earliest. “While that is agreed by all, it is still not clear what would be their critical elements. We need to first understand the meaning of ‘transparency’ in this new, digital world as things can change very quickly”.

Talking about free trade agreements, he underlined that as they are reciprocal in nature, “there is not much need to have flexibilities in them. Those countries who are heavily dependent on flexibilities to balance their trade and developmental needs are finding it difficult to adjust to two different systems of their engagement with international trade”.

This was the fourth of a series of webinars on this subject organised by CUTS International, a global public policy think- and action-tank promoting consumer welfare through trade, regulations and governance.



Source link

Articles You May Like

What could make Congress provide more financial aid
Here’s what to consider if your company offers an early-retirement package
Luxury electric vehicles take spotlight in China car show
New F1 CEO will need to address future of U.S. Grand Prix in Austin
Earnings season kicks off soon and results could be better than feared

Leave a Reply

Your email address will not be published. Required fields are marked *

Loading...