What is it about?
The force of populism and the adjustment pressures of globalization have together created a hostile environment for the WTO's rules-based trading system. This article traces these effects and suggests domestic economic reforms and changes in the WTO and trade diplomacy to restore multilateralism in trade relations.
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Why is it important?
Since world war II, the GATT/WTO system has established stability in international economic relations and thereby contributed heavily to global trade, investment and economic growth. Rapid change in patterns of comparative advantage and investment has undermined political support for trade liberalization and WTO rules. The resulting uncertainty in trade policy has begun to weaken incentives for investment and market integration, creating a drag on global economic growth. Restoring confidence in the rules-based trading system is an essential element of achieving sustainable economic growth in the world economy.
Perspectives
During most of my academic career I have focused on the importance of the GATT/WTO system as an institution that undergirds global economic efficiency, stability and growth, not to mention its role in promoting political stability among nations. As a trade institution, the WTO is worth defending, but it will be necessary for it and its members governments to adapt to new patterns of comparative advantage and geopolitics to renew its role in supporting peaceful trade relations and trade liberalization.
Professor Kent A Jones
Babson College
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This page is a summary of: Populism, Globalization, and the Prospects for Restoring the WTO, Politics and Governance, January 2023, Cogitatio,
DOI: 10.17645/pag.v11i1.6086.
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