Decades ago, specifically following the end of World War II, global free trade was promoted as the promised paradise of economics, and the Soviet Union, with all its leftist and economic socialist concepts, was standing in front of the world, and these heavens of free global trade, and of course the United States was the godfather of that freedom trade and free movement of capital. By the end of 2021, the volume of world trade is regarding 43 times the level recorded in the early days of the GATT agreement, “a growth of 4,300 percent from 1950 to 2021”, and global trade values have inflated today by nearly 347 times from 1950 levels, the volume and value of world trade has expanded by 4 and 6 percent, respectively, on average since the establishment of the World Trade Organization in 1995, and the current average applied tariff in the world’s most favored nation is 9 percent.
However, it was not until the middle of the second decade of the 21st century that dreams of global trade seemed to dissipate. Donald Trump won the US presidential election by promising to impose 20 percent tariffs on imports, build a wall to keep out Mexican immigrants, and renegotiate the trade agreement. On the other side of the Atlantic, the trends were not much different. In the first round of voting for the 2016 French presidential election, right-wing candidate Marine Le Pen found strong support with her promises to leave the European Union and a majority vote in favor of Brexit. European Union in June 2016.
These separate events point to the return of protectionism, and the reason as many studies that investigated the reasons underlying these shifts indicate that the regions most exposed to trade with low-wage countries increased the shares of the vote that go to far-right parties, and the votes for Britain to leave the European Union were More related to local exposure to trade with China, and in a study of the United States between 2002 and 2010, the results showed that the increased exposure to trade with China was associated with a shift towards the extreme right and the extreme left, so it was not a coincidence that US governments adopted protectionist economic and trade positions, and took Many restrictions impede free trade exchange with his country’s largest trading partners – China and the European Union – despite the change in the US administration and the arrival of the Democrats to the White House, the Biden administration did not cancel the Trump administration’s trade measures, as if it was in complete agreement with it.
Today, many believe that the World Trade Organization has not been able to achieve any important multilateral trade liberalization, and there are many developing countries that are no longer happy with the World Trade Organization, while bilateral, tripartite and multilateral trade agreements are growing, which overwhelms the importance of the World Trade Organization. Today, there are more than 40 trade blocs such as Brexit, the Asian and the Group of Eight, and these trade blocs are working vigorously to redefine global trade and “de-globalization” as every country is now trying to achieve self-sufficiency, increase exports and reduce imports.
In a survey conducted by Al-Eqtisadiah regarding the seriousness of these trends and the possibility of the world being exposed to trade wars on the grounds that countries tend to retaliate by setting up increasing trade barriers and imposing discriminatory tariffs on imports. This is supported by a professor of investment systems at the University of Glasgow, who today faces obstacles with international investments, with the adoption by the US authorities, the governments of European countries, Britain and even China of laws and measures to review foreign investments under the pretext of national security, but other experts believe that globalization as an idea linked to free trade still enjoys great acceptance. , and that what is happening is not a retreat from its idea, but rather a reorganization of globalization and then free trade, and not an abandonment of it, as the consultants in the World Trade Organization confirm that free trade and the movement of capital have not ended, but they are taking new forms that depend more and more on regional ties and the formulation of formations For economic blocs of sensitive and important sectors, a complete abandonment of free trade and globalization is neither achievable nor desirable among the partners.
Experts believe that there are new commercial formulas for international cooperation, but its final form depends on a decline in supply chain disruptions, a solution to the problem of port congestion in the United States and China, and a decrease in shipping costs to levels before the Corona virus epidemic, as some believe that the Russian-Ukrainian war forces everyone to Remain silent for now. In conclusion, the indicators of the global economy and the movement of international trade currently need a strong new impetus to establish renewed concepts and values from which most countries will benefit, and not remain under the hegemony, control and monopoly of one-way powers.
