Global Recession Needs Global Solutions Without Protectionist Trade Barriers

Given the dynamics of world trade, the present global recession will only be cured by solutions that are beneficial to all nations.

That is why the European Union (EU) has been most outspoken about the ‘Buy American’ clause  in the $800bn (£567bn) economic recovery package now before Congress.

John Bruton, EU ambassador to Washington, said that, ‘We regard this legislation as setting a very dangerous precedent at a time when the world is facing a global economic crisis’.  Europe would launch a complaint with the World Trade Organization (WTO) if the clause remained.

The Canadian ambassador to Washington has also warned that the clause could provoke protectionism and trigger retaliatory moves.

Thankfully it would seem that President Obama is of like mind.  He stated that the Iron and steel provision won’t be allowed to trigger a trade war:

“I think it would be a mistake though at a time when worldwide trade is declining for us to start sending a message that somehow we are just looking after ourselves and not concerned with world trade,” he said.

One hopes that as all work together the recession can be as limited in scope and time as is possible.  That is an outcome clearly desired by all.

Related articles by Zemanta

• Trading blows (news.bbc.co.uk)