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World Trade Report 2022
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The COVID-19 pandemic and the prospect of increasingly frequent and more intense natural and man-made disasters raise important questions about the resilience of the global economy to such shocks. The World Trade Report 2022 explores the basic, binary assumption driving much of the current debate about economic resilience, namely the inherent trade-off between global trade interdependence and national economic security, and suggests that this can be a false dilemma. Due to its interconnected nature, international trade can increase an economy's exposure to risks and contribute to the transmiss...
The COVID-19 pandemic and the prospect of increasingly frequent and more intense natural and man-made disasters raise important questions about the resilience of the global economy to such shocks. The World Trade Report 2022 explores the basic, binary assumption driving much of the current debate about economic resilience, namely the inherent trade-off between global trade interdependence and national economic security, and suggests that this can be a false dilemma. Due to its interconnected nature, international trade can increase an economy's exposure to risks and contribute to the transmission of shockwaves. At the same time, it can bolster economic resilience, particularly when backed by domestic policies and effective global cooperation. As a driver of economic growth, trade can generate the resources and knowledge needed to prepare for crises. It can also help countries recover by facilitating the provision of goods and services needed to cope with a crisis. Policies aimed at increasing economic resilience by re-shoring production and unwinding trade integration ultimately reduce economic resilience. Conversely, trade diversification can contribute to economic resilience by allowing countries to be less dependent on a limited number of importers, exporters and sectors. The World Trade Report 2022 shows that a more open, inclusive and predictable trade environment is needed to promote diversification and contribute to economic resilience. The WTO already plays a key role in making economies more resilient by promoting lower trade barriers and greater transparency in trade policies. Further international cooperation at the WTO can strengthen the mutual supportiveness of trade openness and economic resilience so that the world is better prepared to deal with future crises.
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