Trade restrictions among G20 economies remain high, says WTO report
The steady accumulation of trade-restrictive measures in the G20 since 2009 has gradually increased the share of global trade affected by such restrictions
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GENEVA—G20 nations have imposed a total of 85 new trade-restrictive measures during the second and third quarters of 2016, according to the latest report on G20 trade measures from the World Trade Organization (WTO).
This average of 17 new measures per month is down from 21 per month imposed in the previous reporting period (mid-October 2015 to mid-May 2016), representing a return to recent trend levels after a peak in the first half of 2016.
In addition, the rate of trade-facilitating measures applied each month declined against the previous period, and remains considerably below the 2009-2015 trend.
The steady accumulation of trade-restrictive measures since the financial crisis has gradually increased the share of global trade affected by such restrictions. As of the most recent reporting period, the share of world imports covered by import-restrictive measures implemented since October 2008 and still in place is five per cent and the share of G20 imports covered is 6.5 per cent.
“The continued introduction of trade-restrictive measures is a real and persistent concern. Tangible evidence of G20 progress in eliminating existing measures remains elusive,” said Director-General Roberto Azevêdo
“It is clear that the financial crisis has had a long tail and that the world economy remains in a precarious state. Many people are struggling with unemployment or low paying jobs and are concerned about broader changes in the economy. These concerns demand a concerted response from governments and the international community. One step will be for G20 members to deliver on their commitment to refrain from imposing new trade-restrictive measures and roll back existing ones,”Azevêdo said.
The initiation of trade remedy investigations remained the most frequently applied measure by far, representing 72 per cent of trade-restrictive measures and above the average share observed since 2009.
The G20 economies initiated far more trade remedy actions (61) than were terminated (36) during the latest reporting period. Metal products (in particular steel), chemicals, and plastics and rubber account for the largest shares of anti-dumping and countervailing initiations during the review period.
On the positive side, the new trade-facilitating measures include those implemented in the context of the newly expanded Information Technology Agreement (ITA) and which have very broad trade coverage. The number of these measures does not provide a complete picture of the extent of these measures nor their impact, but WTO Secretariat estimates indicate that the ITA expansion measures which were implemented by certain members during the review period cover around US$ 375 billion in annual global trade.
• The number of new trade-restrictive measures being introduced remains worryingly high given continuing global economic uncertainty and the WTO’s downward revision of its trade forecasts, predicting 1.7 per cent world merchandise trade volume growth in 2016, from its earlier forecast of 2.8 per cent. If this revised forecast is realized, this would mark the slowest pace of trade and output growth since the financial crisis of 2009.
• Of the 1,671 trade-restrictive measures recorded for G20 economies since 2008, only 408 had been removed by mid-October 2016. The overall stock of measures has increased by 5.6 per cent compared to the previous report—the total number of restrictive measures still in place now standing at 1,263.
• During the review period, G20 economies also applied 66 measures aimed at facilitating trade. At just over 13 new trade-facilitating measures per month, this represents a slight decrease over the previous report and remains below the 2009-2015 overall average trend.
The G20 economies are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Republic of Korea, Japan, Mexico, the Russian Federation, the Kingdom of Saudi Arabia, South Africa, Turkey, the United Kingdom and the United States, as well as the European Union.