The G20 countries have largely resisted the temptation to adopt protectionist measures in response to the financial crisis and subsequent recession, according to a report published by the Organization for Economic Co-operation and Development and UN Conference on Trade and Development
The report, release Monday, commends governments for avoiding new protectionist barriers, saying, “by and large, G20 governments have continued to honour their commitment to refrain from raising new barriers to international investment.”
Looking ahead, the report calls on the governments of G20 countries to:
– ensure that assets acquired in the crisis are disposed of in a timely, non-discriminatory and open way;
– wind down emergency schemes as quickly as economic conditions permit; and
– make progress on financial reform to restore confidence in the financial sector and market economy.
“With the economic recovery still fragile and unemployment high, protectionist pressures will remain,” said OECD secretary-general, Angel Gurría. “Countries must hold firm and keep trade and international investment open to boost their economies.”
A companion report for the G20 on both trade and investment measures, released by the OECD, UNCTAD and the World Trade Organization, underlined the importance of trade and investment in ensuring economic recovery. It also warned that some of the emergency measures introduced in the crisis or currently being introduced may have a more significant impact on trade, investment and competition than the traditional trade and investment restrictions.
That report finds that while the global economic outlook has improved over the last six months, the recovery is still subject to significant downside risks. It forecasts that world GDP will grow by 4.2% in 2010, mainly driven by the robust performance of emerging developing countries. Merchandise trade is forecast to expand by 9.5%, while global FDI inflows, which fell by 40% in 2009, are projected to grow, at best, moderately. In advanced economies, unemployment is projected to decline only slowly from its current level of close to 9%.
IE
G20 keeps investment flows open: OECD
Continued vigilance needed with the economic recovery still fragile
- By: James Langton
- June 14, 2010 June 14, 2010
- 11:46