Global Trade In Decline

The World Trade Organization says global trade will shrink by 9% this year,which is the worst performance since World War II.Jakob Kirkegaard of the Petersen Institute of International Economics thinks that is truly devastating.It starts the stuttering halt to the engine of globalization.The idea of decoupling will definitely have taken a shot across the bow.Asia has been dependent on ultimate demand by the U.S. and Europe.The bailouts are going to promote protectionism.There is a sense that tax money must be spent on domestic industries,Mr.Kirkegaard indicated.

Indian Ambassador Concerned

India's Ambassador to the World Trade Organization,Ujay Sing Bhatia,has noted the effect of financial rescue packages on free trade.Mr.Bhatia observed that such measures could add up to three billion dollars' worth since Q4 of 2008.These plans are regarded as ultimately distortive of free trade,with their components of industrial support,bank rescues and tariff increases.Mr.Bhatia called for clarifications in order to assess how this government aid is altering competitiveness.Indeed,many of the steps could be seen as violations of European Union free trade rules.WTO officials complained that they are not getting enough official information to make accurate assessments of possible distortions.With their export-driven economies,developing nations such as India are especially vulnerable to protectionist leanings.