Global rules on e-commerce, international coordination of domestic procurement policies, trade facilitation reforms and tariff reduction can help global economic resilience in pandemic times, suggests the World Trade Report 2021 of the World Trade Organization (WTO).

The report comes close to the WTO's 12th Ministerial Conference (MC12) where trade ministers from across the world will review the functioning of the multilateral trading system, in the backdrop of the Covid-19 pandemic. MC12 will take place from November 30 to December 3, 2021 in Geneva, Switzerland.

Released on November 16, the annual flagship publication of WTO examines why the interconnected global trading system is both vulnerable and resilient to crises, how it can help countries become more economically resilient to shocks, and what can be done to make the system better prepared and more resilient in the future.

According to the report, trade-restrictive domestic measures adopted, in anticipation or response to shocks with negative cross-border spillovers such as export restrictions, can undermine economic resilience. “Global policy coordination can, therefore, be an important means to prevent trade policies from becoming a source of shocks and to mitigate the risks from trade policy uncertainty,” according to the report.

Tariff reductions or elimination is one of the solutions suggested in the report to reduce the cost of essential goods. Trade facilitation reforms that can help smoothen customs procedures for the importation of critical goods in times of crisis is another suggestion. The report recommends negotiations on services, domestic regulation to overcome the scarcity of essential services, particularly in the health or telecommunications sectors. Greater cooperation to improve the predictability and transparency of measures that limit barriers to cross-border services and the delivery of essential goods has been sought. The report pitched for global rules on electronic commerce to facilitate the delivery of goods and services, and international coordination of domestic procurement policies for more effective use of public resources, particularly in the procurement of medical products, including vaccines. New initiatives in relation to intellectual property (IP) and investment to promote access to relevant technologies in middle and low-income countries have also been proposed.

The World Trade Report also carries an opinion piece by public health expert Ellen ‘t Hoen on the need to keep ‘vaccine knowledge’ a global public good as Covid-19 has laid bare the lack of an effective mechanism for sharing the IP and technology required to produce the diagnostics, therapeutics and vaccines to respond to the pandemic. Hoen argues that the world needs new rules to ensure automatic access to technologies and IP in the case of a pandemic. Stating that the preparedness to face the next pandemic should start now, Hoen wants no monopoly on access to technologies to prevent and treat a pandemic. Public financing for research and the development of vaccines and treatments on conditions that make the know-how open-source for further research or production at-scale, and creation of vaccine production capacity in the regions that currently have no or insufficient production capacity have also been proposed.

Quoting IMF, the report pointed out that the Covid-19 pandemic and ensuing response measures have seen global GDP falling by 3.3% in 2020 and global per capita GDP by 6.2%, the most severe recession since World War II. In comparison, global GDP fell by about 0.6% in the 2008-09 recession, according to the report. However, economic growth is projected to recover to 5.3% in 2021 and 4.1% in 2022 due to the vaccines and additional policy support in a few large economies.

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