Not only doomsayers, but also reasonable observers with a knowledge of history, were afraid that the recession that suddenly struck in 2008 would lead to a major wave of protectionism, as in the Great Depression of the 1930s, and thus to a prolonged decline in international trade. Mercifully, it didn't happen.
The G8, which resolved in 2009 not to yield to trade-war temptations, may well have helped avert any surge of economic nationalism - along with the persevering presence of the World Trade Organization and other wholesome institutions. There is reason to hope, then, that the G8 and G20 summits in Huntsville, Ont., and Toronto will continue - and improve on - their work for a world of comparatively free trade.
Vigilant observers deserve gratitude, but the deviations they have pointed out are not very scandalous. The G8 Research Group's report on the member states' compliance with their commitments gives them their lowest score on trade - 0.78 - but some of the particulars are anti-climactic. Canada, for example, has prohibited the sale of flavoured tobacco to young people, which amounts to an import ban, given that Canadian producers don't flavour their tobacco, and quite a few American ones do.
Robert Wolfe of Queen's University presented a paper to the Canadian Political Science Association this month that draws especially on WTO reports and the Global Trade Alert, a website that monitors policies that could harm trade. Many of the governmental actions these sources point out are not really new policies restricting trade, such as the G8 members promised not to enact, but rather, new trade actions under pre-existing laws, such as anti-dumping proceedings.
Most strikingly, a high proportion of the instances collected by the GTA over the past two years fall into the "bailout" category, otherwise known as financial protectionism. Naturally, nation-states bailed out their own financial institutions, not those of other countries - hardly a case of virulent nationalism. The same goes for stimulus packages, which the world's governments were all urged to undertake, more or less in unison; they then set about subsidizing their own economies by their fiscal deficits, not foreign ones.
The G8 and G20, now that stimulus is mostly receding and deficit reduction is the order of the day, ought to move forward on international trade, not just preventing setbacks - figuring out a way to revive the stalled Doha Round negotiations - and not least on agriculture, in which Canada is one of the obstacles.Report Typo/Error
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