MORE TRADE, MORE PROTECTION: INSIGHTS AND IMPLICATIONS OF THE UNENDING CONTRADICTION
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WTO/FLACSO Argentina
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Despite the stance of the WTO and various RTAs, elements of trade protectionism
remain prevalent. This could be understood by the divergence between countries’
national interests and international trade protocols, which was reverberated during the
recent global financial crises. However, the contradiction has taken new turn following
new protectionist instruments. Furthermore, the implication of these instruments on
developing countries economy is prevalent. Thus, this study explores the likelihood to
engage in trade protection and the implication on developing country, focussing on
Africa. The study observes that in the first quarter of 2012 alone, the number of
protective measures amounts to 67, with bail out and trade defence accounting for as
much as 74%. Similarly, from 2009 to 2011, trade defence mechanisms and bailout
accounted for 25% of the protective measures; while tariff and non-tariff are also
frequently used, jointly constituting about 28.11%. The study reveals that a country’s
level of economic development is not a fundamental determining factor with regards to
its tendency to engage in trade protectionism. However, the study establishes among
others that as a country’s institutional quality improves, the less the tendency of being
involved in protectionism. Paradoxically, the more a country’s trade integration, the
higher its tendency towards protectionism, which might be alluded to the fact that when a
country trades more, it has more interest to protect as major complainants of trade cases
are also major traders. The study reveals that a country’s per capita income growth was
significantly and adversely affected by the contemporary protectionism. It impacts
negatively on trade balance; however, such impact was essentially significant for African
countries.
Keywords
JZ International relations