Gordon Brown: Restraining Trade Will Prolong the Recession

NDN's Dr. Rob Shapiro recently discussed on how the Great Recession has created protectionism without passing any protectionist laws. In today's Wall Street Journal, British Prime Minister Gordon Brown writes to American audience, arguing that, "The collapse of global trade is the most immediate issue we face. We must show once again our determination to fight back." An excerpt:

The simple truth is that trade is the most serious casualty of the global financial crisis, with a vicious circle emerging of falls in exports leading to falls in production and rising job losses leading to further falls in consumer demand, exports, etc. We used to think that the countries most affected by the global financial crisis would be those with the largest financial sectors. But it has become increasingly clear that the countries hardest hit are those most reliant on exports.


Developing countries have been particularly hard hit as a result of declining world trade and falling commodity prices. Some 100 million more people are in poverty as a result of the crisis. All the progress we have made to reduce poverty is in danger of being wiped out.

Just a few months ago, the WTO forecast global trade to fall by 9% in 2009. In simple terms, a banking crisis has become a trade crisis.

There can be no recovery in the global economy without a revival of world trade. Trade was the driver of postwar recovery in Japan, Germany, the rest of Europe and the U.S., and the engine of growth in Asia in recent decades. We must ensure that a revival of world trade leads the global economy once again out of recession.

More here.