Meanwhile, APEC ministers in a statement said while the ability to obtain financing for trade has improved, the situation continues to “bear watching.”
Saying the world economy is facing its worst crisis in many decades, Lamy cautioned against protectionist trade policy, saying it had “played a significant role in deepening and prolonging the economic downturn” of the 1930s.
“This time, so far, we have been more fortunate, thanks to improved macroeconomic management, the solidity of WTO rules and disciplines built since the end of the 1940s and the self-restraint of governments,” he added.
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| Lamy |
“We need to be realistic about the challenges that await governments in the coming months. Pressure is likely to increase on policymakers to resort to contingency measures and other actions that restrict trade, particularly if the upward trend in unemployment persists before things get better,” he added. “Political resolve will be needed to continue to show restraint.”
The APEC ministers issued a statement noting that the International Monetary Fund is forecasting the world economy will contract by 1.4 percent this year and that half of the 21 APEC economies will experience GDP contraction.
“Although there have been some recent signs of the global economy stabilizing, the situation remains uncertain, and significant risks to economic and financial stability persist. We remain committed to working together to overcome the current economic crisis and to prepare for recovery in a manner that is consistent with APEC's vision of free and open trade and investment. We will seek to ensure that the benefits of globalization are spread more widely across our societies and that our growth strategies are consistent with sustainable development.
APEC noted that earlier this year, the World Bank estimated that 10-15 percent of the decline in world trade was due to difficulties related to trade financing.
“Facilitating trade finance is therefore an important policy measure to support the recovery of global trade and the global economy. Recognizing that trade finance is an issue that spans both the trading and financial sectors of the economy, our senior officials have been meeting their counterparts from finance ministries from early this year to take stock of the trade finance situation and to ensure that APEC has an effective response.
We note that the trade finance situation has generally improved since then but bears watching as global credit conditions remain tighter than usual.
The complete Meeting of APEC Ministers Responsible for Trade, Statement of the Chair (July 21-22) may be found here.
