Simon Evenett

The manner and extent of state discrimination against international business since the start of the Global Financial Crisis is documented and interpreted. Without resorting to 1930s-style across-the-board tariff increases, governments have tilted the playing field in favor of local firms so often since November 2008 that 70% of the world’s goods exports competed against crisis-era trade distortions by 2013. Export mercantilism and other forms of selective subsidization are persistent features of crisis-era policy response. Available evidence also casts doubt on the notion that foreign direct investments have been treated as well as successive World Investment Reports contend.

The extent to which the Sino-US trade war represents a break from the past is examined. This ongoing trade war is benchmarked empirically against the Smoot–Hawley tariff increase and against the sustained, covert discrimination by governments against foreign commercial interests witnessed since the start of the global economic crisis. The Sino-US trade war is not the defining moment that some contend. Thus, laying the blame for the current woes of global trade entirely at the feet of policymakers in Beijing or Washington, D.C., is unfounded. Since the rot started well before 2018 and implicates many states, greater attention should be given to the factors determining the unilateral commercial policies of governments during and after a systemic economic crisis. The insights from the economic history literature of the 1930s presented here are useful in this regard. Moreover, claims that existing multilateral trade rules have bite are hard to square with the very large shares of global trade affected by policy measures favouring local firms implemented over the past decade. When confronted with severe adverse economic conditions for better or for worse, WTO members had plenty of policy space after all.

At the beginning of its G20 year, the German Presidency attached little priority to trade policy. That stance had to change with the ascension to office of a U.S. President unwilling to follow the diplomatic niceties on trade policy of his predecessors. Moreover, following the U.S. withdrawal from the Trans-Pacific Partnership (TPP) in the first quarter of 2017, the fear grew that election-era protectionist slogans might be converted into action by the United States. This article assesses how effectively the German Presidency and the G20 process in general managed the Trump-induced 'stress test' on trade policy. The non-binding form of international economic cooperation, evident with the Leaders’ Summit appears, in our opinion, to have been only partially successful.

Despite initial intentions to better align transatlantic regulation and associated practices in the negotiation of the Transatlantic Trade and Investment Partnership (TTIP), this was not possible for rules concerning genetically modified organisms and data privacy. By 2016 both matters effectively fell off the TTIP negotiating agenda. This paper identifies the factors responsible, specifically the critical role played by independent regulatory agencies and associated bureaucratic politics, transnational coalitions of private sector organizations, and non-government organizations and contingency. These factors are not exclusive to the two salient regulations considered here, with the implication that the identification of cross-border spillovers is at best a necessary condition for the successful negotiation of binding trade rules on behind-the-border government policies.