Stepping Back from Trade Protectionism: the Time is Right

International trade law is often considered one of the more successful areas of international law since it benefits from robust enforcement and dispute mechanisms. However, international trade law faces its own challenges, and a new one may be imminent: the elimination of protectionist sentiment and measures that governments around the world have adopted in response to the global financial crisis. Governments, particularly the G20[1], have acknowledged the issue of rising protectionism.[2] However, in light of several reports examining the measures adopted by G20 governments, the G20 leaders’ commitments following their most recent meeting in September demonstrate that they are not moving fast enough, or far enough, to reign in protectionist tendencies.

As we are all well aware, the international credit crisis, which came to the fore in 2008, resulted in the collapse or near-collapse of financial institutions and sources of credit for businesses around the world – causing trade levels, investment and global output to plummet, and thousands of jobs to disappear. In the fall of 2008, there were fears that a depression similar in intensity to the Great Depression of the 1930s was looming. In response, many states announced significant injections of capital into troubled financial institutions and industrial sectors to avoid their collapse, and to facilitate access to credit by industry. They also adopted measures to stimulate domestic demand.

Global leaders, particularly those representing the G20…

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