Rethinking the Global Trading System
August 31, 2009
With the global economy slowing, global trade negotiations currently not making sufficient progress, and the emergence of a risk of increased protectionism, the need to demonstrate the importance of trade and the positive contribution it can make to economic growth and global welfare has never been more pressing. Completing an ambitious Doha Development Agenda for the World Trade Organization (WTO) would help restore confidence in markets, as well as represent a powerful statement by members of the world trading system of their commitment to an open global economy.
Given the fundamental changes under way in the global economy, however, progress on trade will require a strategy that looks beyond the Doha Round—one that rethinks the ends and means of trade policy in a more globalized world economy. Toward this end, the Government of Sweden organized a conference to elicit fresh thinking on the direction of trade policy in advance of Sweden's assumption of the European Union's presidency in July 2009. The conference, held in Washington on March 25, 2009, had three main objectives:
- assessing what changes in the structure of international trade and investment mean for the conduct of trade policy in globally integrated markets;
- exploring how trade policy and the trading system can best contribute to addressing the broader challenges the global community confronts, specifically to a reduction in global poverty and a response to global warming; and
- determining the appropriate role for the WTO and the trade regime in light of the growing debate over reforming the international economic architecture.
This report provides a summary of the conference by Grant Aldonas, CSIS senior adviser, as well as commentary by Jonas Hafstrom, Swedish ambassador to the United States, Ewa Bjorling, Swedish minister for trade, and Paul Krugman, 2008 Nobel laureate in economics.