I approve of the priorities that Russia has chosen, said Peter Draper from the South African Institute of International Affairs
Peter Draper, Senior Research Fellow in the Economic Diplomacy program at the South African Institute of International Affairs, is convinced that the introduction of protectionist measures goes against the interests of the G20 countries, and an independent evaluation could play an important role here.
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Question: Could a peer review of protectionist measures become a credible mechanism to ensure further trade liberalization?
Peter Draper: Yes. There is already a peer review process, coordinated by the WTO secretariat in cooperation with the OECD. It reviews protectionist measures in the G20, for G20 meetings. That has been going for some time now and it shows steadily increasing protectionism, and G20 members being primarily responsible for the problem. So I think the information is out there. The problem is how to give the peer review mechanism some teeth; how to make it work optimally. The information is there but the member states ignore it. The question needs to be passed back to those G20 members to discuss.
Question: Which initiatives could the G20 adopt to address the growing role of non-tariff measures in international trade?
Peter Draper: As for the growing role of non-tariff measures, there are various WTO rules for WTO members - Russia is of course now a WTO member. Unfortunately there is some flexibility in interpreting the application of non-tariff measures. Therefore it is a difficult issue to address at a general level, it really comes down to specific cases. The peer review problem could serve a useful purpose in this regard, by highlighting egregious cases and, the flip-side, best practice. More importantly, it is important for member states to understand that it is not in their own interests to introduce these measures because they will interfere with, and harm, their competitiveness. If you are taking steps to undermine your competitiveness by protecting your domestic producers then you are actually inflicting long-term damage on your economy. So the key thing for member states to realize is that protective measures are not in their own interest.
Question: Could investment in infrastructure stimulate wider international cooperation in trade?
Peter Draper: Sure, two levels. At the national level countries that invest in infrastructure will be able to export and import more easily and the logistics infrastructure will grow around that. That is good for competitiveness and growth. At the regional level, for example in Africa which is where I come from, there there are many infrastructural deficits that are actually regional in nature. So you also need to invest in regional infrastructure. That will help landlocked countries, for example, to integrate into the global economy.
Question: What is your personal view on Russia's presidency priorities? What could be Russia's input or contribution to G20 agenda?
Peter Draper: Well, I like the fact that the Russian Government has decided to limit the agenda and not to introduce new issues as new issues would be a distraction. The finance track has its own momentum and has been running for a long time now; whoever takes over the G20 presidency inherits that agenda. There's not that much room for innovation so I don't expect too much that would be new from the Russian presidency.
Then on the Sherpa's track I like the core priorities that have been set out: trade, investment, sustainability. Those are the big economic longer-term issues outside the finance track that need to be addressed in order to maintain the global economy. I hope that this focus will be sustained, particularly the focus on trade and especially with Russia have just joined World Trade Organization and seeming to be much more interested in trade issues such as your Customs Union projects for instance. Russia also recently showed leadership in APEC through the deal to liberalize trade in certain environmental goods. I hope this positive momentum can be sustained, and that Russia will not succumb to the allure of ‘intelligent protectionism' as espoused by some.