São Paulo – A report disclosed on Thursday (31) by four multilateral agencies informs that there was no reduction in the rhythm of imposition of trade barriers in the countries of the G20 from October 2011 to May 2012. The G20 includes the group of main developed and emerging economies. The organisations also say that the removal of existing trade barriers is taking pace slowly.
The Organisation for Economic Co-operation and Development (OECD), the World Trade Organisation (WTO) and the United Nations Conference on Trade and Development (Unctad) inform that this situation increases the risk of retraction of the world economy. To the organisations, the nations in the block should support themselves in the opening of markets for the return to global growth.
Although many of the G20 leaders criticise protectionism, in practice some governments adopted measures to stimulate domestic production in detriment of imports. In Cannes summit (in France), countries renewed their commitment to refrain from raising barriers or imposing new barriers to investment or trade in goods and services, says the study. As a group, the G20 must work for this engagement to continue being targeted by other governments and the private sector, it adds.
To the organisations, the matter is concerning. "We know that closing markets stifles growth and makes it harder to tackle unemployment,” said the OECD secretary general, Angel Gurría, in a press statement. "Countries must resist the temptation to implement inward-looking trade and investment policies,” he said. Last week, ten multilateral agencies, including the OECD, WTO and Unctad disclosed a study pointing out that the trade opening generates more jobs and income.
Many of the measures are not clearly trade barriers, but they end up causing a similar effect. The report points out policies turned to replacement of imports, among them the granting of tax breaks and subsidies to local production, preference to household items in government purchases, non-automatic import licenses, greater custom requirements and internal taxes on imported items, among others.
Many of the measures adopted by the government of Brazil in recent months are included in the description of the report, like the greater Tax on Industrialized Products (IPI) on imported vehicles, an increase of the Tax on Financial Operations (IOF) for certain international transactions, a preference for purchase of domestic products for the Armed Forces, lower IPI for the national vehicle industry, among others.
Argentina is also included. Although the country is not mentioned specifically, the study mentions a case of expropriation of foreign property in the period as one of the G20 actions that increases the feeling of risk and may affect the business environment and economic recovery. The government of Argentina nationalised former state owned company YPF, which had been privatised to the Spanish Repsol. In the financial and trade area, Argentina is imposing restrictions to the flow of dollars and goods, also from Brazil, its main partner in the Mercosur.
Balance
Still on Thursday, the OECD disclosed a balance of global trade in the first quarter. The flow of goods between the main economies rose moderately.
There was, according to the organisation, growth of 1% in imports and 0.6% in exports from the countries of the G7 (the seven most developed in the world) and of the Brics (Brazil, Russia, India, China and South Africa). There was, however, reduction of 4.2% in Chinese exports and 3.8% in Chinese imports. This has happened for the first time since the first quarter of 2009.
In a report, the organisations estimate growth of 3.7% in global consumption this year, below the 5% of 2011, the 13.8% of 2010 and the 5.4% of the last 20 years.
*Translated by Mark Ament
