The trade ministers of the UK, Australia, Singapore and New Zealand have rallied together to warn against the rebuilding of global trade barriers in the wake of the Covid-19 crisis.
Liz Truss and her counterparts Simon Birmingham, Chan Chun Sing and David Parker have penned a joint letter to several newspapers in response to calls from some quarters that the pandemic should move countries to strengthen their barriers.
The ministers agreed on the acute need at this time for countries to refrain from imposing unnecessary export controls or tariffs, and on the need to remove any existing restrictions on the trade of essential goods, especially food and medical supplies.
But they said more needed to be done.
Trade liberalisation
“Some people think this crisis should mean less trade in the future, and onshoring of supply chains. Some argue for a rolling back of the trade liberalisation that has underpinned much of the world’s economic growth over recent decades,” the ministers wrote.
“Increased protectionism would only harm the world’s recovery from Covid-19, slowing the necessary return of economic and employment growth.”
The ministers said those who would “undo decades of progress” should not be allowed to take advantage of the current crisis by imposing stricter trade controls.
“Sharing challenges and diversifying where we buy from and sell to, can make us all more resilient and better protect us in the event of future shocks,” the letter continued.
Supply chains
“Diverse supply chains can not only increase just in time efficiency but also boost just in case resilience.
“For all these reasons and more, putting in place more trade barriers would be the worst possible response to global economic uncertainty.
“More barriers would further erode business confidence and would slow the investment needed to restart many economies.
“Developing countries, who have often seen the greatest transformation from opening up, might find themselves shut out of world markets, reducing prosperity and employment.”
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