On March 26, the Washington International Trade Association (WITA) and the Asia Society Policy Institute (ASPI) held an online webinar on trade policy in response to the coronavirus outbreak.
- Wendy Cutler, vice president of ASPI and former negotiator in the Office of the U.S. Trade Representative (USTR)
- Simon Evenett, Professor of International Trade and Economic Development at the university of St. Gallen
- Suzanna Fisher, First Secretary of Trade at the Embassy of Australia
- Trevor Gunn, Vice President of International Relations for Medtronic, the world’s largest technology company
- Ambassador Alan Wolff, Deputy Director-General of the World Trade Organization (WTO)
Trade Liberalization as a Policy Response to Coronavirus
Cutler began the discussion by emphasizing the importance of promoting free trade in the medical healthcare sector and avoiding the imposition of new restrictive trade measures. “There’s an emerging recognition around the world that trade initiatives are critical to address the pandemic and stem a global economic recession. These initiatives should focus on supply chains, trade restrictions, keeping ports, airports, and other trade lines operational,” she said.
According to Evenett, trade restrictions such as export curbs may do more harm than good in the current context. Since domestic firms lose the ability to produce for foreign markets, they tend to produce less. Instead, he argued, we want these firms to ramp up production, to address the fact that “demand for medical supplies has accelerated far ahead of domestic production.” Even though about 20 countries unilaterally liberalized the importation of medical supplies and other Covid-19 related products in the week before this webinar, other countries decided to take more restrictive policy approaches.
Of the 63 current bans imposed on medical supplies and medicines, 48 were imposed in the month of March. In the 48 hours prior to the webinar, 8 bans were imposed. Additionally, Evenett noted that bans were increasingly expanding to the area of food, notably in Ukraine, Russia, Kazakhstan, and Vietnam. He argued that the supply concerns leading countries to impose such bans had likely been exaggerated, as not every country experiences the peak of the virus at the same time.
Negotiation and Implementation
Fisher focused on trade policy negotiation and implementation, recommending that policymakers provide trade negotiators with specific information about the products they will discuss. The more general the requirements, she explained, the longer it will take negotiators to reach an agreement. For example, a “personal protective equipment” agreement will likely be reached more quickly than a “medical supplies” agreement. She added that it will also be important to include Customs officials in the process. Customs authorities at the border need to be able to access, fully understand, and apply the outcome of any agreement at the border to ensure the efficient enforcement of new policies.