Going It Alone? Trade policy after Three Years of Populism



Simon J. Evenett & Johannes Fritz | Max Schmidheiny Foundation & CEPR Press

Based on analysis of 6,755 changes to public policy affecting cross-border trade, investment, data flows, and labour migration implemented since 1 January 2017, this report confirms that the political rhetoric more critical of a liberal trading system witnessed in recent years has translated into greater protectionism and less trade liberalisation worldwide. This commercial policy shift is not confined to China and to the United States. Nor is it across-the-board, nor uniform across governments. Moreover, no account of trade policy in the Populist era would be complete without reference to significant pockets of tariff cutting and subsidy reduction seen during the past three years. Still, as the maps on the preceding pages showed, almost every nation saw export exposure to protectionism rise by more than exposure to trade reforms. World trade is less free today than it was at the dawn of the Populist era.

The turn towards populism and nationalism over the past three years is taking its toll on the world trading system, not just on Sino-U.S. trade. Full implementation of the “phase one deal” between Beijing and Washington won’t unwind all Populist era tariff hikes on Sino-U.S. trade, let alone the shift towards protectionism seen elsewhere. To the extent that corporate leaders curtail investment on account of protectionism worldwide—as opposed to focusing on Sino-U.S. trade tensions—then the policy dynamics documented here imply a sustained drag on global economic growth.


To read the full report, please click here