UAE Daily: Free trade is necessary for a global recovery

Abu Dhabi: “Free trade and open markets are the best way to create and distribute wealth among nations”, stressed a UAE daily in its editorial today.

So, at a time when the global economy is struggling to overcome recession, stagnation and volatile financial markets, unhindered international trade and commerce is the best hope for a quick, sustainable recovery; Gulf News added.

This means the warning by Canadian Prime Minister, Stephen Harper, that a trend towards protectionism is pushing the world towards a prolonged recession, must be taken very seriously, explained the paper.

It is also ironic, as Canada is reportedly delaying foreign – specifically Chinese – investment in its energy industry. Harper said he was concerned that consensus on global trade was slipping among the G20 that was in talks with others at the World Trade Organisation (WTO). This is inevitable as the talks have been dragging on as countries and regional blocs try to protect national special interest groups that often have undue domestic political influence, the paper noted.

“A real breakthrough at the WTO will require a show of political courage by leaders who will have to set aside narrow, national interests, for sustainable global growth which will benefit all”, it said.

Unfortunately, there has been little sign of such commitment at the talks, which have been deadlocked as developing countries resist opening their markets until advanced economies end subsidies to politically connected industries. Subsidies are an expensive, under-handed way of protecting domestic industries and interfere with the effective functioning of markets, as perhaps shown by the European financial crisis.

“The world cannot afford for the WTO talks to fail” asserted the paper.

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