22 Nov 2019
WTI workshop considers trade wars and their impact
The term ‘trade war’ is frequently heard these days, but what exactly does it refer to and what is the impact of these wars on global trade and smaller economies? This was the topic of a one-day workshop held at the World Trade Institute (WTI) on 21 November.
Jointly organised with the Chung-Hua Institution for Economic Research, Taipei, the event brought together academics, lawyers, diplomats and researchers from Switzerland, Taiwan, the EU, China and Singapore.
Opening the event, WTI Director of Studies Peter Van den Bossche said the theme of the workshop was “unfortunately very topical” given the number of trade wars currently being waged. These range from the small-scale to the huge, notably that between the United States and China. The purpose of the workshop was to examine the issue from a economic, legal and political science perspective.
There is no doubt the ongoing trade wars had a detrimental effect on global trade and economic growth, Professor Van den Bossche said. There were no winners in trade wars as the cost was a world of reduced security and predictability.
Despite that, trade wars do offer certain opportunities to smaller economies, panellists said. For example, Chinese Taipei has seen companies return home from China and has been able to position itself as a strategic partner to the US in its reindustrialisation bid.
It was noted that trade wars – or disputes that have escalated with the imposition of tariffs and counter tariffs – go against the spirit of the rules-based multilateral trading system, epitomised by the dispute settlement system at the heart of the World Trade Organization.
Panellists argued that the importance of the rules-based system has increased as the world has become more interconnected by trade. Although the WTO has not prevented the current outbreak of trade wars, it has perhaps prevented many more wars from happening.