Global trade has plummeted. The world is de-globalizing. But will the crisis – and the responses to the crisis – foster new ideas and policies that will entrench de-globalization?
Governments have responded to the crisis by raising barriers to cross-border commerce. There has not been a massive rush to protectionism and fears of spiraling tariff hikes a la the 1930s, when protectionism followed hard on the heels of a Wall Street crash, has fallen flat on the ground. But rich and poor countries alike have succumbed to protectionist tools and there has been a sharp increase in discriminatory policies – through ‘buy national’ provisions in stimulus packages to demands on banks to deleverage abroad or not hire foreign personnel if they should be eligible for government support. This trend is likely to continue as the effect of the crisis becomes more severely felt.
As government interventions in the economy escalate, new fears have been raised over a 1970 style scenario of creeping protectionism. New domestic regulations then spilled over to the border. Governments sprayed ailing firms with subsidies. Interventions exacerbated initial stress and prolonged the crisis, which provoked another wave of protectionism. The 1980s became the ‘long decade of creeping protectionism’. Are we today seeing a replay of the 1970s?
You are cordially invited to an ECIPE seminar in Stockholm on the future of globalization and the open world economy.
13:30 Introduction Fredrik Erixon
13:45 The Financial Crisis and De-globalization Johan Norberg
14:10 The Economic Crisis and Trade Responses Patrick Messerlin
14:35 A Return to the 1970s and Creeping Protectionism? Razeen Sally
15:00 Coffee break
15:30 Keynote address by Ewa Björling
16:00 Panel discussion
17:00 End note
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