Guest blogger Lawrence J. Lau makes the case for keeping the trade door open, outlining options for China and the world.

The “open door” policy was a critical component of the economic reforms China introduced in 1978, opening the country to the outward and inward flow of goods and services, of capital, and of people.

Deng Xiaoping’s government brought China into the globalised economy, expanding international trade and attracting foreign direct investment, which brought with it capital, technology, markets, new business models and methods needed after decades of relative isolation. It permitted hundreds of thousands of Chinese scholars to go abroad for exchange and advanced study, and let foreign experts become involved with China. The “open door” underpinned the extraordinary growth of the Chinese economy over the past three decades.

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Trade ministers have not met for a broad-ranging WTO Ministerial Conference since the launch of the Doha Round in 2001. At the G20 London Summit, governments should call for a full Ministerial Conference in Geneva to be held this year.[1]

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Guest blogger Ricardo Meléndez-Ortiz makes the case for how to de-risk and de-carbonize global trade through better governance.

The past 12 months have seen trust demolished. In addition, daily uncertainty about the fundamentals of the economic environment have resulted in generalized anxiety about the future. Not the ideal conditions for a rapidly changing world to confront the daunting challenges facing it.

The world economy entered the twenty-fi rst century at a high speed of globalization. In most parts of the world and across borders, economic activity thrived as never before, driven by a cocktail of technological change, hastily multiplying and available capital, and freshly abundant and readily available labour. As a result, local and national economies, and their societies, today find themselves tightly interlaced into the dense fabric that was so swiftly weaved.

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Guest blogger Caroline Dommen offers her views on how human rights can help define priorities for the governance of global trade.

Developing countries have been struggling for years to have their trade-related concerns recognized and acted on by their developed country counterparts. In parallel, civil society groups have been calling attention to ways in which international trade policy can go counter to development, sustainability, and equity objectives.

The current financial crisis, following close on the heels of the food crisis, reveals structural problems with the global economic system. Governments have reduced their regulatory role, leaving many elements of the system to private actors. Whilst some people have profited handsomely from new trading opportunities opened up by technological advances and by liberalization policies, others have suffered.

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Guest blogger Sylvia Ostry reflects on the challenges for the trade system amidst the financial crisis

If there was ever any doubt about the close, even intimate, relationship between trade and finance in the global economy, the statement issued by the G20 leaders on 15 November 2008 put that doubt to rest. In that document – wide ranging and complex – the G20 tasked several national and international organisations with implementing enunciated principles for reform of financial markets and an initial set of specific measures, including high-priority actions to be completed by the end of March 2009.

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Guest blogger Dominique Njinkeu sets out the challenges facing Africa in the current economic crisis, highlights the and makes the case for a stimulus package for Africa to address shrinking trade.

The current global downturn is a crisis emanating from advanced economies rather than from bad policies on the part of Sub-Saharan African (SSA) countries. African economies will nevertheless be affected through a variety of international trade-related channels, including reduced commodities prices and exports receipts, foreign direct investment and equity flows, exchange rate fluctuations, and remittances. Trade is already shrinking, growth declining, and unemployment rising. The associated losses for SSA countries are forecasted at over USD 50 billion in 2008-2009. Unless appropriate solutions are identified and swiftly implemented, the crisis risks undermining the achievements of three decades of policy reform, thus further reducing the possibility of achieving the UN Millennium Development Goals. Fortunately, such solutions exist that could even turn the crisis into opportunity for African countries.

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Roberto Bouzas

The challenges faced by developing countries and sustainable development regarding global economic governance are not substantially different from those faced by the developed world. In fact, both groups of countries share common challenges.

The first and most urgent challenge is to revive the multilateral trade regime. In the last half century, trade has been the policy area in which the international community has made the most strident progress towards cooperation. In the last decade, however, the effectiveness of the international trade regime has eroded under the weight of a changing international and domestic landscape (a new balance of power, an expanded membership, the emergence of new constituencies, and the development of uncharted regulatory areas). These structural transformations were underway well in advance of the financial crisis, but a creeping recession and mounting protectionist pressures have sharply deepened existing tensions.

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Guest blogger Shuaihua Cheng provides a Chinese perspective on global trade governance and the economic crisis, focusing on the upside of a downturn.

The most critical problem facing global trade governance at this moment is that we have focused too much on problems at the World Trade Organization (WTO). It is dangerous to disregard the fact that the WTO has functioned well as a stabilizer of basic global economic order amidst economic turmoil.

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Guest blogger Yash Tandon sets out a forward-looking agenda for global trade governance and sustainable development from a Southern perspective.

The world’s multilateral negotiations on trade and on sustainable development over the last decade yield two important lessons for the multilateral system.

The first lesson concerns the interconnectedness of things: trade, security, employment, human rights, development, terrorism, migration, poverty, climate change are all interconnected. For the developing countries of the South, trade and climate change are a dual facet of their continuing sustainable development challenges.

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Guest blogger Richard Higgott sets out the challenges and priorities for G-20 leaders to contain the spread of the financial crisis to the trade sector.

The governance of global trade and the international trade regime will clearly be affected by the fallout from the current wider economic and financial turmoil. Enhanced global economic policy coordination is needed. Existing institutions do not currently offer enough – in either sufficient quantity or quality. Amidst efforts to stabilise the global economy, the multilateral trade system is threatened by the perception that globalization has been tarnished by speculative investment and other excesses in financial markets seeking ever larger profits at the expense of sound business practice.

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