Strong trade liberalisation despite trade war - ING

Timme Spakman, economist at ING, notes that new WTO data shows a steep rise in trade liberalisation and on an annualised basis, trade flows subject to liberalised measures are now three times higher than before the start of the trade war, outpacing restrictive measures.

Key Quotes

“The Trade Facilitation Agreement (TFA) of 2017 and the Pacific Trade Agreement CPA-TPP are now largely ratified, pushing up the amount of trade flows covered by liberalised measures.”

“New import tariffs, which are part of the US trade dispute with China, make up the bulk of the restrictive trade measures.”

“Trade liberalisation is expected to continue as new trade agreements are due to be implemented.”

“Nevertheless, we think a further escalation of the US-China trade war will overshadow these new efforts to liberalise trade. This doesn’t bode well for world trade, with forward looking trade indicators such as PMIs and IATA flight data already below trend.”