The World Trade Organisation (WTO) has justifiably received much criticism in recent years for its failure to push through the next round of trade liberalisation. Instead bilateral and regional agreements tend to have been the domain for reductions in trade barriers.
It is a fascinating turn of events therefore to see the WTO emerge as the forum attempting to stem the rising tide of protectionism. There are genuine fears that the current rash of stimulus policies also represent retrograde steps that will reintroduce national preference, higher tariffs, quotes and the like.
Technically the various rules within the various WTO-monitored treaties should act to prevent such behaviours. Unfortunately the WTO’s enforcement measures often are trade-restricting themselves (such as right for a nation to impose countervailing duties on offending nations), and the body is often slow to investigate and act.
This is a not a minor issue in the international business arena. Much multinational expansion is predicated on reasonably free movement of their goods. If this cannot be retained we will be seeing a much more traumatic crisis than that currently being tackled at the national level. The WTO’s moves warrant very close attention. A return to some winning form is strongly needed.