uniaktuell The online magazine of the University of Bern

uniaktuell from 2015

"We have never traded more than we do today"

Amid the global turbulence caused by forced migration, rising populism and opposition to globalisation, trade remains as vital as ever, according to participants in the World Trade Forum organised by the World Trade Institute of the University of Bern (WTI) and held in Grindelwald on 6–7 October. The conference on 'Trade Policy in Turbulent Times' also marked the official end of the WTI’s NCCR Trade Regulation research project.

By Morven McLean

Over the past 12 years the NCCR's team of legal scholars, economists and political scientists have examined how the world trading system functions and the way trade impacts on areas including climate change and migration. The event brought together policy makers and trade practitioners as well as researchers from the project's three phases who had the opportunity to present some of their findings.

Opening the Forum, Director of the NCCR Manfred Elsig commented on how much the world had changed since the project launched in 2005. This was the year in which Angela Merkel became the first woman chancellor of Germany and the Kyoto Protocol set the first internationally binding carbon emission reduction targets.

While the World Trade Organization continues to provide the framework for the way trade is regulated, the last 12 years have seen a mushrooming of trade agreements among individual countries with their own rules. The result has been a growing fragmentation in the trade landscape. These trade agreements and the provisions they contain have been one important strand of the NCCR’s research.

At the same time, recent years have seen increasing scepticism in the western world about globalisation, and anxiety in the United States, fuelled by now-President Donald Trump, that trade is taking away manufacturing jobs.

The trade myth

Several speakers were at pains to point out trade is not the root cause of job losses. 

"It is a myth to think trade is the main cause of middle class woes," argued Caroline Freund of the Peterson Institute for International Economics in Washington DC. The slump in manufacturing was caused by structural change and not because of imports from China or Mexico, she said. And while there was a lot of discontent among US workers, research had shown they didn’t blame trade. In fact support for trade was at an all-time high.

Trade would not happen if it was not beneficial for both sides, commented Maria Asenius of the European Commission. It was good for wealth and job creation, and "the most natural thing you can do with your clothes on", she quipped.

Joakim Reiter, Group External Affairs Director at Vodafone and formerly Deputy Secretary-General of the United Nations Conference on Trade and Development (UNCTAD), pointed to the enormous social benefits that trade had brought, lifting millions out of absolute poverty. And trade is becoming more inclusive, he said, referring to the role of emerging economies. "We have never traded more than we do today and there have never been more participants in trade than we have today." 

Facing up to the challenges

Many speakers agreed that there was a need to make the benefits of trade clearer. Structural change may result in manufacturing jobs being lost but technology and digital trade are opening up new possibilities. 

"Technology is creating new opportunities that are not always very visible, whereas jobs lost are very visible," commented Arancha Gonzalez of the Geneva-based International Trade Centre.

Maria Asenius argued that it was also essential to act on people's concerns over globalisation. "We need to invest in people, in education and in skills," she said. The senior EU official said that it was important to move to a more values-based trade system, supporting sustainable development, promoting gender equality and including anti-corruption rules in future trade agreements. The planned Transatlantic Trade and Investment Partnership (TTIP) mega trade deal between the EU and the US was "in the freezer" and would likely remain there for several years, she said, but the EU had an ambitious agenda for negotiations on closer trade relations with a number of countries and regions. 

There was a consensus among speakers that despite the proliferation of trade agreements, the WTO would continue to play a crucial role in a world marked by global value chains. But WTO agreements needed to evolve to reflect the changed reality, for example by taking account of new technologies, including digital technology. 

Training a network of experts

The last word went to Professor Thomas Cottier who launched the NCCR, directing it in its first two project phases. He said he was particularly proud to have trained a great number of doctoral students and to have established an interdisciplinary network of international trade experts. "The idea was to have everyone under one roof, tackling the issues together," he said. 

World Trade Institute (WTI)

The World Trade Institute (WTI) is a leading academic institution dedicated to graduate-level studies, research and outreach activities on international trade regulation and investment. As a centre of excellence at the University of Bern, it explores the interconnections between law, economics and political science. 

Since 2005 the WTI has conducted research within the National Centre of Competence in Research (NCCR) Trade Regulation funded by the Swiss National Science Foundation. Over the past 12 years the NCCR has given rise to 335 peer-reviewed articles, 130 books and 686 presentations at congresses. The three-phase project comprised six work packages: trade governance; new preferentialism in trade; innovation and competitiveness in trade governance; trade and the diffusion of migration law, policy and economics; trade and climate change; impact assessment in international trade regulation. The NCCR came to an official close with the World Trade Forum in Grindelwald.

Other research projects at the WTI

The Design of Trade Agreements (DESTA) project is an offshoot of the NCCR. It aims to collect systematic data on the design of preferential trade agreements that have been signed since 1945. 

PRONTO is a collaborative research project on regulatory barriers to trade, supported by the European Commission and managed by the WTI. 

Common Concern explores the legal potential of the principle of common concern in different areas of public international law: climate change, biodiversity, monetary affairs and corporate responsibility, and human rights.

UniPress interview with Manfred Elsig, Managing Director of the NCCR (in German only)

Im Gespräch zum Thema Globalisierung mit dem Wissenschaftsmagazin UniPress zieht Manfred Elsig auch Bilanz über den «NCCR Trade Regulation».

About the author

Morven McLean works as a web editor at the World Trade Institute.