Trade and protectionism—the emerging role for G20

Abstract

In 2008, there was a real risk of an upsurge in trade and investment protectionist measures, as governments sought to protect their economies from being ravaged by the financial crisis. The G20 leaders therefore undertook a commitment to refrain from raising new barriers to investment or trade in goods and services or to impose any export restrictions or to implement any WTO inconsistent measures to stimulate exports. The language of the commitment was unique inasmuch as it covered both WTO consistent and inconsistent measures, although it emphasised only WTO inconsistent measures that stimulated exports (G20 2008). The WTO Agreement already provided a bulwark against protectionist measures that infringed its obligations, but the intention was to go further and discourage all trade distorting measures, whether or not they were consistent with its obligations. It was in the nature of a political, not a legal commitment. The WTO and other organisations were mandated to monitor the developments so as to help the process of diplomatic pressurisation, of naming and shaming.