Foreword
The year 2024 marks a global election cycle with over 80 countries, representing more than half of the world’s population casting their votes. In these uncertain times, the world finds itself confronted by a state of “polycrisis”—a complex web of interconnected global challenges that transcends borders. Geopolitics and international trade have a critical role to play in driving solutions to these crises.
As many countries continue to navigate the aftermath of the COVID-19 pandemic, the world contends with other pressing issues such as the increasing urgency of tackling climate change and addressing the fragmentation of traditional geopolitical alliances. As nations confront various stressors, including ongoing conflicts in several regions around the world, these interconnected issues have heightened uncertainties and undermined the previously robust support for open trade.
Consequently, countries are increasingly looking inwards, focusing on reshoring, “friendshoring,” and forming strategic alliances. Amid these shifts, there has been a noticeable backlash against globalization and free market economics, accompanied by a global rise in support for interventionism, a trend showcased by the growing embrace of industrial policy. In this evolving context, trade has emerged as both a strategic instrument and a point of tension, as demonstrated by the simmering trade war between the United States and China, and fragmentation spurred by competition among geopolitical blocs.
These geopolitical maneuvers are reshaping global trade patterns, leading to trade diversion and the formation of new economic relationships. Although the World Trade Organization (WTO) also faces its own crises, it remains a vital platform for promoting international cooperation. For example, to facilitate pathways to cooperation and mitigate economic security risks, the WTO can provide a forum for members to design a mechanism to address economic security concerns while supporting multilateral governance, as one of the report’s authors suggests. At the same time, the focus on securing supply chains and fostering domestic capabilities, particularly in clean technology and critical raw materials (CRMs), underscores the integration of trade and technological advancement. However, alongside a clean tech boom, a wave of protectionism and industrial policy has blossomed in these key industries. The result is a global critical minerals supply chain that discourages responsible actors, presenting security and labor rights concerns.
Ultimately, the promise of a sustainable and interconnected future hinges on international cooperation. The WTO’s current rules on technical barriers to trade can serve as a guide for the development of enforceable mining standards to help mitigate the risks of expanded mining activities while refraining from raising significant trade barriers. Additionally, the organization can take concrete steps to ensure the clean technology boom also leads to clean technology transfer by prioritizing linkages between the trade and climate regimes and their respective technology transfer initiatives. The WTO could also revitalize discussions on reducing barriers to trade for environmental goods (and services), elevating them to top priority.
Across all of these issues, the implications of trade policies for developing countries, particularly workers, remain a critical concern. These countries often face significant challenges in accessing the full benefits of global trade, and are increasingly impacted by unilateral trade measures and trade-related policies. The quest for inclusivity and fairness in trade is crucial for addressing global issues such as climate change, as developing countries often lack the financial resources, infrastructure and technology, and institutional capacity to meet climate targets. Such economic disparity risks the exclusion of developing countries from the benefits of global climate initiatives. Alongside this, re-globalization can leverage trade measures to improve the representation of workers and other groups previously excluded from the design, implementation, and enforcement of trade policies. Addressing gaps in an inclusive trade agenda is essential to ensuring the benefits of trade are more equally distributed across developing countries and vulnerable stakeholders, including women.
Several opportunities exist to meet this challenge, many of which are highlighted in this report. For example, the rise of digital trade presents important new opportunities to reduce financial inequities and enhance trade integration. The adoption of digital payments systems can serve as a driver for more inclusive growth. Importantly, digital payments are critical for providing banking services to women and minority groups in remote or underserved areas. Digital wallets and mobile payment solutions have increased basic transactional accounts across Africa, Latin America, and the Asia Pacific, enabling money transfers and remittances. However, continued innovation in new technologies and services to ensure people everywhere realize their full economic potential depends on open digital ecosystems and free cross-border data flows.
As the world navigates these complexities, it is vital to view trade policy with both optimism and realism. The competing policy goals and the multifaceted nature of current global challenges necessitate a balanced perspective on the role of trade in addressing these issues. The annual TradeExperettes ‘Quick Wins’ report, developed with contributions from experts across academia, think tanks, international organizations, and the private sector, provides valuable insights and practical recommendations for policymakers. This year’s report, Ten “Quick Wins” for Re-globalization and Resilience in Trade, reflects a concerted effort to tackle contemporary trade issues with a nuanced and informed approach.
During her intervention at the 2024 World Economic Forum Annual Meeting, WTO Director-General Ngozi Okonjo-Iweala said, ‘We need to think of globalization not in the way it was done before, but differently. And we need to make sure that those who did not benefit during the first round benefit this time.’ This is the time for members, and more broadly speaking, the trade policy community, to rethink globalization and resilience to meet today’s challenges and secure a more sustainable future for years to come.
Project Coordinator,
Emilie Kerstens & Gabriella Beaumont Smith
Brussels, London
August 22, 2024
