Several countries, including 17 of the G20 largest economies, have implemented measures restricting trade at the expense of other countries, a study by the World Bank shows. This violates the pledge G20 leaders signed in November 2008 to avoid protectionist measures, the Bank argues.
According to the World Bank’s monitoring list, officials have proposed 78 trade-related measures, of which 66 involve trade restrictions. The countries have brought in 47 of these measures.
The World Bank says the effects of such restrictions are difficult to evaluate. Richard Newfarmer and Elisa Gamberoni, the authors of the report, say that so far the measures “have probably had only marginal effects on trade”. However, they note these trends are a source of concern and should be monitored.
“The sharp contractions in trade volumes evident in recent months are a consequence not of protection, but of the global recession and financial feedbacks through sky-rocketing costs of a shrunken pool of trade finance,” the study continues. “Nonetheless, the trend in protection is up and the full effects of recession have not yet been felt.”
The study suggests that the G20 should adopt additional measures to “strengthen the fragile consensus against further protectionism”.
Among other measures, it recommends the G20 should commit to greater transparency and promote the use of standard safeguard provisions instead of anti-dumping laws. The G20 could also advocate greater aid for trade for low-income countries and endorse voluntary implementation of trade facilitation provisions, the study says.
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