World Bank: Beware the ides of protectionism

World Bank chief Robert Zoellick warned against countries engaging protectionist policies as a way of combating the global economic crisis.

"Leaders must not heed the siren-song of protectionist fixes, whether for trade, stimulus packages, or bailouts," Zoellick said. Zoellick also advised that “economic isolationism” would compound rather than solve the problems created by the world economic downturn.

Despite a November pledge against doing so 17 of the G20 countries imposed trade restrictions. For instance, Zoellick’s report comes as the U.S. and Mexico are in a tiff over trade. Zoellick highlighted the protectionist policies of several Latin American states:

(…) The most obvious trade restrictions -- raising tariffs, or taxes on imports -- represent only about a third of all measures taken. Some countries are taking a direct approach. Ecuador [ed. – not a G20 country]… has raised tariffs on more than 600 items. But most are taking more creative steps that fall into the gray area of what is considered legal under international trade law.

Argentina, for example, has put new licensing requirements on auto parts, textiles, televisions, toys, shoes and leather goods that create a new layer of bureaucracy for overseas exporters.

The next G20 summit is expected to take place next month in London, England.

Image- AFP (“A diplomat is seen at the World Trade Organization headquarters in Geneva.”)
Online Sources- The Latin Americanist, Washington Post, Xinhua, AFP