Trade openness reduces conflict, poverty
The 2023 edition of the World Trade Organisation (WTO) World Trade Report has revealed that recent geopolitical tensions are beginning to affect global trade flows, including in ways that point towards fragmentation of trading relationships.

WTO Secretariat calculations find, for example, that goods trade flows between two hypothetical geopolitical blocs, based on voting patterns at the UN General Assembly, have grown 4-6 per cent more slowly than trade within these blocs.

The report also presented new evidence of the benefits of broader, more inclusive economic integration as early indications of trade fragmentation threaten to unwind growth and development. Released yesterday, the report also features findings on how re-globalisation or increased international cooperation and broader integration, can support security, inclusiveness and environmental sustainability.

Introducing it, the global trade body’s Director-General, Ngozi Okonjo-Iweala said: “The post-1945 international economic order was built on the idea that interdependence among nations through increased trade and economic ties would foster peace and shared prosperity.

“For most of the past 75 years, this idea guided policymakers and helped lay the foundation for an unprecedented era of growth, higher living standards and poverty reduction. Today this vision is under threat, as is the future of an open and predictable global economy. The case for strengthening the trading system is far stronger than the case for walking away from it.”

However, the report contends that, despite these findings, international trade continues to thrive, implying that talk of de-globalisation is on balance still not supported by the data. The publication points to the expansion of digital services trade, environmental goods trade and global value chains in addition to the resilience of trade to the recent global crisis.