WTO chief warns against 1930s-style trade protectionism
09 Jul 2024 --- Global trade is facing “protectionist pressures and signs of economic fragmentation,” according to the director general of the World Trade Organization (WTO).
Dr. Ngozi Okonjo-Iweala says that despite these significant concerns, the organization’s Trade Monitoring Update shows positive signs of governments worldwide taking meaningful steps to facilitate trade in the face of “current geopolitical uncertainty.”
“This Trade Monitoring Update underscores the resilience of world trade despite the challenging geopolitical environment. Even in a context of rising protectionist pressures and signs of economic fragmentation, there are governments around the world still taking meaningful steps to liberalize and facilitate trade,” she says.
“At the same time, a series of import-restricting measures announced recently to be captured in the update looks set to affect a significant amount of world trade.”
“I am encouraged to see efforts by members to use the WTO and other venues to find solutions to their differences. This is far better than ‘tit-for-tat’ retaliation that leaves everyone worse off.”
Anti-dumping probe
Okonjo-Iweala’s comments follow recent news that Chinese authorities have launched an anti-dumping probe into the European Union’s pork exports, which experts fear could impact European food producers.
This followed an investigation by the European Commission into imports of Chinese electric vehicles.
China also targeted French brandy imports in another trade dispute earlier this year, and it is understood the country will announce provisionary punitive tariffs on European brandy in August. Sources suggest this could extend to dairy and wine.
Copa and Cogeca, the organization for farmers and agri-cooperatives in the EU, recently said that such disputes were costly for the EU and the agri-sector. Speaking about the pork dispute, it shared that EU agri-food producers “have been growing wary of further escalation.”
“This is not the first time EU’s well-performing agri-food products are caught in the crossfire of disputes concerning other sectors. From the perspective of the pork producers and the agri-food sector that works hard to ensure and maintain market access in China, this is not acceptable,” it outlined in a statement.
Chinese authorities have launched an anti-dumping probe into the European Union’s pork exports.
Signs for optimism
The WTO’s Trade Monitoring Update shows member countries introduced more trade-facilitating (169) than trade-restricting (99) measures on goods against a backdrop of uncertainty. Most of the measures were on the import side.
The WTO says this reverses a trend observed between 2021 and 2023, when the number of new import restrictions outpaced the number of new export restrictions.
Its figures also show a rapid increase in industrial policy subsidies, particularly in climate change and national security areas.
The update covers the period between mid-October 2023 and mid-May 2024. It focuses on goods, services, and intellectual property to measure the health of world trade.
