Govts urged to hike efforts to keep markets open

The G-20 has witnessed a slowdown in the imposition of new trade restrictive measures during the period from mid-May to mid-October 2012, according to the report of the World Trade Organisation (WTO) Director-General Pascal Lamy, on trade measures issued recently. The report said “at a time of continuous economic difficulties, trade frictions seem to be increasing”, calling on G-20 governments to “redouble their efforts to keep their markets open, and to advance trade opening as a way to counter slowing global economic growth”. Lamy added that around 55 per cent of the total number of new measures recorded over the past five months have been categorised as trade facilitating, in comparison with 45 per cent at the time of the previous monitoring report, while the trade facilitating measures cover around 0.7 per cent of G-20 merchandise imports. The WTO also forecasted a growth in trade of 4.5 per cent in 2013, which is still below the long-term annual average of 5.4 per cent for the last 20 years. The report ended with a renewed appeal from the directors of the WTO, OECD and UNCTAD to the governments of the G-20 to redouble their efforts to strengthen multilateral cooperation and to seek to avoid situations that would crease trade tensions between them, adding that the multilateral trading and investment system needs to continue to act as an insurance policy against protectionism. The UAE Ministry of Foreign Trade’s (MoFT) Trade Negotiations and WTO Department, in its summary and analysis of the report, pointed out that such reports have been released periodically since 2008 to monitor the trade measures that are adopted by the G-20 to deal with the ramifications of the global financial crisis. The report pointed out that despite the slowdown in imposing trade restrictive measures in the G-20 economies over the past five months, new measures are adding to the stock of restrictions put in place since the outbreak of the global crisis, most of which remain in effect, calling on G-20 governments to redouble their efforts to keep their markets open, and to advance trade opening as a way to counter slowing global economic growth. It added that as “in previous monitoring reports, trade restrictions and inward-looking policies will only aggravate global problems and risk generating tit-for-tat reactions. The difficulties and concerns generated by the persistence of the global economic crisis, with its many facets, fuel the political and economic pressures put on governments to raise trade barriers. This is not the time to succumb to these pressures”. According to the report, the global economy had encountered increasingly strong resistance during the past few months that preceded its publication. It added that the “prospects for the global economy look worse than at the time of the release of the previous G-20 monitoring report due, among other things, to budget developments and the persistent debt crisis in some major G-20 economies”, adding that output and employment data in many countries have “continued to disappoint, despite the many measures implemented to contain the slowdown in economic growth”. In the face of these developments, the WTO Secretariat has recently “revised downward its forecast for world trade growth in 2012 to 2.5 per cent from its 3.7 per cent forecast issued in April 2012”, while the volume of trade growth forecasted for 2013 is 4.5 per cent, which is still below the long-term annual average of 5.4 per cent for the last 20 years. The report added that the trade slowdown in the first half of 2012 was driven by a marked deceleration in imports of developed countries and by a corresponding weakness in the exports of developing countries. For the whole of 2012, the report pointed out, “merchandise exports from developed countries are expected to grow by 1.5 per cent and those from developing countries by 3.5 per cent”. It noted that since mid-May 2012, “71 new trade restrictive measures have been recorded, covering around 0.4 per cent of G-20 merchandise imports, or 0.3 per cent of world imports”, pointing out that the most frequent measures used continue to be trade remedy actions, in particular the initiation of anti-dumping investigations, followed by strict customs procedures. It also adds that there were fewer new export restrictions introduced over the past five months than in previous periods.