Revitalizing the Global Trading System: What Could the G20 Do?

Since 2008, G20 leaders have repeatedly committed themselves not to resort to protectionism and to conclude WTO negotiations expeditiously. The jury is out on the extent to which they have lived up to the first promise; they have failed to deliver the second. Anemic global trade growth rates since 2010 imply that trade has not been a driver of much-needed economic dynamism. This paper argues that the G20 should pursue a more ambitious trade agenda and that there is much that greater leadership by the G20 could do to reinvigorate the trading system. A first step would be to commit to concrete actions that can be implemented by individual governments on a concerted basis and that center on reducing trade costs and improving access to services for firms. The Chinese presidency should also seek to have the G20 commit to more effective monitoring and analysis of trade policy broadly defined (including subsidies and investment incentives) and the impact of the many preferential trade agreements involving China, the EU and the USA, the world's largest trading powers.