The amount of trade covered by 40 new import-restrictive measures of G20 countries from mid-May to mid-October 2018 hit a new high, covering $481 billion in trade, said the World Trade Organization (WTO) in a new report.

The trade coverage of these new measures is more than six times larger than that recorded in the previous reporting period and the largest since this measure was first calculated in 2012, according to WTO’s latest monitoring report.

The report also shows that the trade coverage of new import-facilitating measures ($216 billion) rose significantly during this period but is less than half that of trade-restrictive measures.

WTO director-general Roberto Azevêdo warned the report’s findings constitute a source of serious concern and called for immediate action to de-escalate the situation.

“This report provides a first factual insight into the trade-restrictive measures which have been introduced over recent months, and which now cover over $480 billion worth of trade. The report's findings should be of serious concern for G20 governments and the whole international community,” Azevêdo said.

“Further escalation remains a real threat. If we continue along the current course, the economic risks will increase, with potential effects for growth, jobs and consumer prices around the world. The WTO is doing all it can to support efforts to de-escalate the situation, but finding solutions will require political will and it will require leadership from the G20.”

A total of 40 new trade-restrictive measures were applied by G20 economies during the review period, including tariff increases, import bans and export duties. This represents an average of eight restrictive measures per month, which is higher than the almost six measures recorded during the previous review period (mid-October 2017 to mid-May 2018).

G20 economies also implemented 33 new measures aimed at facilitating trade during the review period, including eliminating or reducing import tariffs and export duties. At close to seven trade-facilitating measures per month, this is in line with the 2012-17 trend. In addition, liberalization associated with the 2015 expansion of the WTO's Information Technology Agreement (ITA) continued to feature as an important contributor to trade facilitation.

G20 economies continued to initiate a higher number of new trade remedy investigations compared to the number of trade remedy actions they terminated. However, the gap between the number of initiations and the number of terminations narrowed compared to previous years.

The main sectors affected by trade remedy initiations during the review period were iron and steel and products of iron and steel followed by furniture, bedding, mattresses and electrical machinery and parts thereof.

The G20 economies are Argentina; Australia; Brazil; Canada; China; France; Germany; India; Indonesia; Italy; Republic of Korea; Japan; Mexico; the Russian Federation; Saudi Arabia, Kingdom of; South Africa; Turkey; the United Kingdom; and the United States, as well as the European Union.

The report makes no judgement about the legality of the measures recorded. In addition, while the report looks at the coverage of new trade measures it does not look at how restrictive they are, or attempt to gauge their potential impact.

Key findings

•    This report covers new trade and trade-related measures implemented by G20 economies between May 16 and October 15, 2018. It shows a number of important trends in global trade policy-making. While G20 economies continued to implement trade-facilitating measures, the figures show a significant increase in the number and coverage of trade-restrictive measures. This provides a first factual insight into the trade‑restrictive measures imposed in the context of current trade tensions.

•    G20 economies applied 40 new trade-restrictive measures during the review period, including tariff increases, import bans and export duties. This equates to an average of eight restrictive measures per month.

•    During the review period, the estimated trade coverage of the import-restrictive measures ($481 billion) was more than six times larger than that recorded in the previous period and is the largest since it was first calculated in 2012.

•    G20 economies also implemented 33 measures aimed at facilitating trade during the review period, including eliminating or reducing import tariffs and export duties. At close to seven trade-facilitating measures per month, this is in line with the 2012-17 trend.

•    The trade coverage of import-facilitating measures ($ 216 billion) has also risen significantly during this period but is just half that of trade-restrictive measures.

•    On trade remedy measures, the review period saw a decrease in initiations of investigations by G20 economies and a stagnation of terminations compared to the previous period. Initiations of anti-dumping investigations remain the most frequent trade remedy action, accounting for almost three-quarters of all initiations. The trade coverage of trade remedy initiations ($ 25 billion) has fallen significantly compared to the previous period. The trade coverage of trade remedy terminations remained equivalent to the previous review period at $ 6 billion.

•    The proliferation of trade‑restrictive actions and the uncertainty created by such actions could place economic recovery in jeopardy. Further escalation would carry potentially large risks for global trade, with knock-on effects for economic growth, jobs and consumer prices around the world.

•    G20 economies must use all means at their disposal to de-escalate the situation. The WTO will do all it can to support its members to this end and leadership from the G20 will be essential. – TradeArabia News Service