Trade Compliance

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Global Trade Increasingly Obstructed by Protectionist Measures: EU Report

Posted November 25, 2014

Despite firm commitments made by G20 countries to fight against protectionism, the tendency to impose trade-restricting measures remains strong around the world, fuelling continuing uncertainty in the global economy, the European Commission said last week in its annual report on anti-protectionist compliance.

EU vs Trade ProtectionismIn the 13 months covered by the Report on Potentially Trade-Restrictive Measures, G20 members and other key EU trading partners adopted a total of 170 new trade-unfriendly measures.

“I regret to see that many countries still consider protectionism a valid policy tool ... Protectionism damages global value chains; trade openness is what we need if we are to keep the recovery going, especially in times of global economic and political instability,”  said Cecilia Malmström, the EU Trade Commissioner.

The number of measures applied at the border and quickly obstructing trade –already high last year – continued to rise, with Russia applying the highest number of individual measures affecting imports. The number of new exports restrictions has also risen, a trend seen as worrisome for the detrimental consequences such practices can have for global commodity markets and value chains.

The report found that countries also resorted more frequently to discriminatory internal taxation, technical regulations or localization requirements to shield their markets from foreign competition. China introduced the highest number of such measures in the period covered.

Investors and service providers also continue to be affected by limitations in access to foreign markets. "The tendency to restrict participation of foreign companies in public tenders remains strong, in particular in the United States," the report says.