WTO links protectionist policies to trade war

Protectionist policies may lead to trade war, according to the World Trade Organisation chief Roberto Azevedo has said.

Azevedo did not implicate any countries by name behind such policies, even though he was asked about the effects US President Donald Trump’s “America First” stance could have on the global trading system, reports said.

“The risk of a trade war is very clear,” Azevedo said during a visit in Panama. “Once a country, whichever one, applies unilateral measures, there is a response from others and we could see a domino effect.”

“The reality is that, at the end of the process, if we have a trade war everybody without exception will be worse off than when it starts.”

Since entering the White House, Trump’s administration has talked about the US trade deficit vis-a-vis several countries, notably China and Mexico.

The president has said he is prepared to tear up the NAFTA free trade deal with Canada and Mexico. Yesterday, reports said the US was looking at probing China for unfair trade practices.

Azevedo was in Panama for meetings with government officials and business representatives.

“The problem we have is a global problem: we have an economy not growing sufficiently fast and that gives rise to temptations of unilateral protectionist actions,” he reportedly said.

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