GENEVA, (Reuters) – International commerce risks being strangled by a gradual build-up of restrictions that could undermine policies to revive the world economy, the head of the World Trade Organisation (WTO) said yesterday.
WTO Director-General Pascal Lamy said there were no signs of an imminent descent into intense tit-for-tat protectionism.
“The danger today is of an incremental build-up of restrictions that could slowly strangle international trade and undercut the effectiveness of policies to boost aggregate demand and restore sustained growth globally,” Lamy said.
Many WTO members at the start of the year appeared to have kept pressures to take protectionist actions under control, he said in a report circulated to members, a copy of which was obtained by Reuters.
“Since then, there has been significant slippage,” he said.
The report, issued a week before the G20 meeting in London, highlights one of the key issues for the summit — how to prevent job-shielding trade restrictions that could turn the recession into a long depression leading to unrest and even war, as happened in the 1930s.
A previous summit of the Group of 20 leading nations in November called on members not to raise barriers to trade, but the dozens of measures imposed since September and cited in Lamy’s report show clearly how that is being ignored.