World has avoided serious protectionism, says WTO

November 19, 2009, 3:59pm

GENEVA, Nov. 19 (AFP) – The World Trade Organization (WTO) on Wednesday said governments have managed to avoid serious protectionism, with trade-distorting measures introduced amounting to at most one percent of merchandise trade.

However, in a report to its 153-member states, the trade body noted that governments were facing pressure from the private sector to protect domestic industries, and rapped industries for such ''unhelpful'' behavior.

''No WTO member has retreated into widespread trade restriction or protectionism, nor has there been any significant instance of trade retaliation,'' said the WTO report seen by AFP.

''The new trade-restricting or distorting measures that have been introduced since October 2008 have covered collectively, at a maximum, one percent of world merchandise trade,'' it added.

At the same time, since its previous report in September, the WTO noted that there have been increasing instances of trade remedy investigations – such probes into whether countries were exporting unfairly priced goods.

''Virtually none of these investigations have been initiated by governments. They have been initiated in response to petitions filed by the private sector,'' said the report, adding that ''this trend is unhelpful.''

If such action were to continue, it would ''give cause for concern that trade restrictions could still weaken the economic recovery,'' said the WTO.

Global trade has already been hard hit by the economic crisis.

On Wednesday, the WTO also assessed that the slump in trade volumes was slightly worse than the 10 percent decline it had forecast earlier for 2009.

''The secretariat believes now that this may slightly underestimate the decline in trade,'' it said, without giving a revised numerical estimate.

The WTO also urged member states to push for a conclusion of the Doha Round of negotiations for a world trade liberalization pact, reiterating that it would give a boost to the global economy which is struggling to regain growth.

''The benefit of an early conclusion to the Doha Round in current circumstances lies in its ability to deliver an economic stimulus package globally that will generate good quality jobs and that does not have to be financed out of over-stretched public treasuries,'' it said.

Launched in the Qatari capital in 2001, the Doha Round of negotiations for a world trade liberalization pact has stumbled on disagreements between developed and developing nations.

World leaders have pledged on several occasions to conclude the talks but deadlines for a deal have been repeatedly missed.

Ahead of a ministerial meeting due to take place late this month, WTO chief Pascal Lamy warned member states that a serious assessment of progress toward a global trade deal was needed if an accord is to be reached next year.