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Full trade recovery at risk without equitable vaccine roll-out

WTO Members from mid-October 2020 to mid-May 2021 exercised trade policy restraint and refrained from an acceleration of protectionism that would have further harmed a world economy reeling from the COVID-19 pandemic, according to the Director-General’s mid-year report on trade-related developments presented to members on 29 July. The report calls on WTO members to ensure that markets remain open and predictable, and warns that failing to ensure wider access to COVID-19 vaccines could undermine the global economic and trade recovery.

This WTO Trade Monitoring Report on trade-related developments comes as the world continues to battle the COVID-19 pandemic. The mid-October 2020 to mid-May 2021 review period covered in this Report provides important insight into a number of areas as countries begin addressing the challenges of a post-pandemic economic recovery. In particular, the past several months have seen international cooperation and coordination among nations and intergovernmental organizations increase and intensify.

The Rome Declaration, made during the Global Health Summit in May, reaffirmed that the pandemic remains an unprecedented global health and socio-economic crisis with disproportionate direct and indirect effects on the most vulnerable. It also emphasized that the pandemic would continue to be a threat until all countries are able to bring the disease under control through large-scale, global, safe, effective and equitable vaccination in combination with other appropriate public health measures.

Recently, the Heads of the IMF, the World Bank, the WHO and the WTO called for a new
commitment to vaccine equity and defeating the pandemic and suggested a USD 50 billion health, trade and finance roadmap to end the pandemic and secure a global recovery. Coordination among manufacturers, suppliers and international organizations was a main theme at the Global COVID-19 Vaccine Supply Chain & Manufacturing Summit in March. Without a broad and inclusive international effort we will not be able to end this pandemic, nor will we be able to successfully fight the next one.

 Cooperation on trade is important as policymakers consider preparedness, response and resilience as an interconnected package. Trade has been a force for good during the pandemic by enabling access to medical supplies. Despite the value of global merchandise trade shrinking by around 8% in 2020, trade in medical supplies increased by 16%, and personal protective equipment (PPE) by 50%. As a platform for transparency, the WTO has a central role to play in ensuring that supply chains are kept open and restrictive trade policies are avoided. The multilateral trading system has kept trade flowing and provided Members with a well-established platform for providing
information on the policies they have taken in response to the pandemic. Throughout the pandemic, WTO committees have worked intensively to address COVID-19-related issues and their impact on international trade. As during the global financial crisis (GFC) more than a decade ago, the foundation of the multilateral trading system has proved solid.

Overall, this Report suggests that trade policy restraint by WTO Members has prevented a destructive acceleration of protectionist trade measures that would have further harmed the world economy. This Report documents how many trade restrictions on goods imposed at the start of the pandemic have been rolled back and that new liberalizing measures have been introduced. The challenge ahead is to ensure that the trade-restrictive measures introduced in response to the pandemic are transparent, proportionate, targeted and temporary. WTO Members must work together as the world seeks to return to strong, sustainable, balanced and inclusive growth, including
through strengthened supply chains and diversified global vaccine-manufacturing capacity.