Challenging the norms of trade arrangements in a climate of protectionism

FREE trade has been the dominant ideal model for international business exchange since the end of the Second World War, when the architecture of the global economy was reshaped and the IMF and World Bank were established, complemented in 1995 by the World Trade Organisation. The lowering of barriers to the free exchange of goods between states and regions has contributed significantly to the trade flows that have changed the food much of the world eats, increased the affordability of consumer products and promoted economic development in previously poor countries (notably China).

There has always been another side to this onwards and upwards picture: established industries in the wealthier countries being devastated by competition from low-wage economies, the highly uneven character of much of the development that has occurred in poorer countries, and the growing clout of transnational companies at the expense of the sovereign powers of states. This downside to free trade has carried increasing weight in the older developed countries in recent years, particularly since the shock of the 2008 recession, stimulating the demands for protectionist policies that contributed towards support for Brexit, the election of Donald Trump in the USA, and a surge in support for nationalist parties and movements in the majority of these countries.

Many analysts tend to absolutise economic theories as standards to which to aspire, without dilution or deviation, and this may contribute to the alarm that the rise of protectionism has generated among those comfortable with the pre-existing pro-free trade consensus.