Protectionism on rise despite pledges: WB

Protectionism on rise despite pledges: WB
The Economic Times, March 19, 2009, Page 9

AFP WASHINGTON

THE World Bank on said Tuesday that major economies have raised protectionist trade barriers despite their collective pledge to refrain from such actions in the face of the global recession.

A World Bank study showed 17 of the Group of 20 developed and developing countries have implemented trade-restricting measures since G20 leaders signed a pledge at an emergency summit last November to avoid protectionist measures.

"Leaders must not heed the siren-song of protectionist fixes, whether for trade, stimulus packages, or bailouts," said World Bank president Robert Zoellick.

"Economic isolationism can lead to a negative spiral of events such as those we saw in the 1930s, which made a bad situation much, much worse."

At a G20 summit hosted on November 15, 2008 by then-US president George W. Bush in Washington, leaders signed the pledge to avoid raising trade barriers as they forge a coordinated response to the deepening economic slump and an intensifying financial crisis.

The G20 includes the Group of Seven industrialized countries — Britain, Canada, France, Germany, Italy, Japan and the United States — and major developing countries Argentina, Australia, Brazil, China, India, Indonesia, Mexico, Russia, South Africa, Saudi Arabia, South Korea and Turkey, as well as the European Union.

A World Bank official, speaking on condition of anonymity, said the research found three G20 members had not raised protectionist barriers: Japan, South Africa and Saudi Arabia.

But the official cautioned that the three countries did not make the list because of "the way the data was sliced mid-February."