Notwithstanding the need to ensure that markets remain open and predictable, the World Trade Organisation (WTO) has warned that failure to ensure wider access to COVID-19 vaccines could undermine the global economic and trade recovery.
The WTO in its mid-year report on trade-related developments presented to members noted that despite strong monetary and fiscal policy support from governments, and the arrival of effective vaccines against COVID-19, which have been important factors in the rebound, COVID-19 continues to pose a threat to the global economy and to public health, as vaccine production remains insufficient, contributing to significant disparities in access across countries.
The trade organisation noted that the situation is especially true for low-income developing economies, which are struggling to obtain enough doses to inoculate more than a small fraction of their populations.
“This report clearly suggests that trade policy restraint by WTO members has helped limit harm to the world economy. However, some pandemic-related trade restrictions do remain in place and the challenge is to ensure that they are indeed transparent and temporary.” said Director-General Ngozi Okonjo-Iweala, who presented the report to WTO members.
“The multilateral trading system has shown resilience despite the severity of the global health and economic crisis caused by the COVID-19 pandemic. As a platform for transparency, the WTO has a central role to play in ensuring that supply chains are kept open — which is an essential part of increasing vaccine production and distribution on the scale needed to end the pandemic. WTO members must show collective leadership, act to ensure that markets remain open, and work together to achieve a successful outcome at the 12th Ministerial Conference (MC12).”
The report, which was reviewed at a meeting of the WTO’s Trade Policy Review Body, notes that since the outbreak of the pandemic, 384 COVID-19-related trade measures in the area of goods have been implemented by WTO members, of which 248 (65%) were of a trade-facilitating nature and 136 (35%) could be considered trade restrictive. Several of these measures, originally introduced in immediate response to the pandemic, have been extended during the review period (mid-October 2020 to mid-May 2021).
Export restrictions accounted for 84% of all restrictive measures recorded. The reduction or elimination of import tariffs and import taxes accounted for 60% of trade-facilitating measures taken, and several members reduced their tariffs on a variety of goods such as personal protective equipment (PPE), sanitizers, disinfectants, medical equipment and medicines/drugs.
As of mid-May 2021, the report showed that around 21% of COVID-19 trade-facilitating measures and 54% of the COVID-19 trade-restrictive measures had been terminated, suggesting a swifter roll back of trade-restrictive measures.
The trade coverage of COVID-19-related trade-facilitating measures implemented since the beginning of the pandemic was estimated at $291.6 billion, while that of the COVID-19-related trade-restrictive measures stood at $205.8 billion. According to preliminary estimates by the WTO Secretariat, the trade coverage of the trade-facilitating measures still in force ($ 179.6 billion) remains higher than that of the trade-restrictive measures ($106.0 billion).