WTO Urges World Leaders to Reduce Trade Restrictions
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WTO Urges World Leaders to Reduce Trade Restrictions

Photo by:   Markus Winkler, Unsplash
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Sofía Hanna By Sofía Hanna | Journalist and Industry Analyst - Fri, 12/09/2022 - 09:06

Trade restrictions continue to increase worldwide, further worsening the economic uncertainty that followed the COVID-19 pandemic, the war in Ukraine and the food security crisis. These issues can further contribute to a worsening global economic outlook. For that reason, the World Trade Organization (WTO) has urged its members to refrain from adopting new trade-restrictive measures and to keep markets open and predictable to allow goods to move around the world to where they are needed.

 

“Members have increasingly implemented new trade restrictions, particularly on the export side, first in the context of the pandemic and more recently in the context of the war in Ukraine and the food security crisis. Although some of these export restrictions have been lifted, many others persist,” said Ngozi Okonjo-Iweala, General Director, WTO. The trade coverage of the trade-facilitating measures was estimated at US$1.16 trillion and of the trade-restrictive measures at US$278 billion. By mid-October 2022, over 9 percent of global imports continue to be affected by import restrictions implemented since 2009, which are still in force.

 

According to the National Institute of Statistics and Geography (INEGI), in September 2022, the value of Mexico’s merchandise exports reached US$52.4 billion, a 25.4 percent increase. This figure represents US$49.1 billion (25 percent increase) of non-oil exports and US$3.3 billion (30.8 percent increase) for oil exports. That same month imports amounted to US$53.2 billion, an increase of 20.8 percent. This figure reflected increases of 17.7 percent in non-oil imports and 46.4 percent in oil imports. Imports of consumer goods grew by 34.2 percent, intermediate-use goods by 18.5 percent and capital goods by 22.6 percent. In September 2022, Mexico reported a trade deficit of US$895 million, while the total trade balance of the first nine months amounted to a deficit of US$25.3 billion.

 

As of mid-October 2022, 79.2 percent of the COVID-19-related trade restrictions have been repealed, leaving 27 export restrictions and 14 import restrictions in place, according to information by the WTO. Although the number of pandemic-related trade restrictions still in place has decreased, their trade coverage remains at US$134.6 billion.


“While trade restrictions may be a tempting response to the supply-side vulnerabilities, a reduction in global supply chains would only exacerbate inflationary pressures, leading to slower economic growth and lower living standards over time. What we need is a deeper, more diversified and less concentrated base for producing goods and services,” stated Okonjo-Iweala. 

Photo by:   Markus Winkler, Unsplash

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