Global Perspective: Regional integration among emerging economies and a raft of new multilateral agreements bolster international trade

Global trade faces protectionist headwinds that are dampening the outlook for growth in the coming years. According to the World Trade Organisation (WTO), trade volumes expanded by 3% in 2018 and are expected to decline slightly to 2.6% in 2019 before rebounding to 3% in 2020. This may be the first time since the 2007-08 global financial crisis that growth will fall below a 3% average, as significant uncertainty driven by an escalating US-China tariff war, acrimonious Brexit negotiations, and wariness surrounding US involvement in several multilateral trade agreements affect business confidence and investment decisions.

Nevertheless, although US protectionist measures and President Donald Trump’s fiery rhetoric currently dominate international headlines, trade blocs in Latin America, Asia Pacific and Africa are creating exciting new multilateral trade areas. Furthermore, several major bilateral trade agreements have been ratified or are in the pipeline and are expected to further boost global trade.

US Protectionism

President Trump has taken an unconventional policy direction on trade, engaging in tit-for-tat tariff wars and withdrawing from major multilateral agreements like the Trans-Pacific Partnership (TPP). In trying to encourage US consumers to purchase local goods and by imposing taxes on imports from major economic partners such as China, the EU, Canada and Mexico, President Trump’s administration is challenging and overhauling the
free trade policies that have governed US economic policy for decades. The Trump administration claims that the international trade system is unfair and prejudicial to US companies, arguing that its trading partners are imposing excessive tariffs on the US and stealing its intellectual property.

Read the full Global Perspective in The Report: Cote d'Ivoire 2019