XXth ABCI Symposium: views on the future of the Multilateral Trade System
2025 Winter - Sergio Goldbaum
The future of the multilateral trade system was one of the major themes in the XXth ABCI Symposium, which was held on 2025 November 21-22, featuring Dmitry Grozoubinsky (Why Politicians Lie About Trade's author), Prof Uri Dadush (Maryland Univ; Geopolitics, Trade Blocks, and the Fragmentation of the World Commerce's author), the Brazilian Secretary of Trade, Tatiana Prazeres, Amb Alan WM Wolff (Peterson Institute for International Economics; Revitalizing the World Trade System's author), and Prof Padideh Ala'i (American Univ).
Grouzoubinky stressed the issues of policy preferences and trade-offs: the US and other developed countries' policy choices seem to reveal that they currently prefer increased predictability and an increased attitude toward long-term investment rather than international stability, lower prices for consumers and a "more efficient distribution of where we make goods and services and how we connect those goods and services with those that want to buy them." In answering a question about Trump's tariffs, he said that what politicians present as no-choice policies are frequently intentional choices and that high tariffs can not consistently achieve two opposing objectives: increase tariff revenues and, at the same time, create jobs in America.
Uri Dadush reinforced the main takeaways from his book. In particular, the prospects of de-globalization are somewhat exaggerated, that despite the protectionist wave, trade is “as free as before the global financial crisis,” that regional trade agreements help facilitate international trade but are not enough, and that a multilateral perspective is still critical. Trade fragmentation and the erosion of the existing global trade rules will prevail in the next four years. Still, economic interest will make trade openness prevail in the long run, so WTO should be preserved. The China-US trade war is still the main question to be addressed, but the impact of China’s subsidies on commerce has been overstated.
Tatiana Prazeres elaborated on the meaning of trade fragmentation for Brazil's interests. For her, trade fragmentation could mean Brazil navigating a more complex global landscape with more restrictive, distorted trade practices. All that with a weaker WTO. So, Brazil may face pressure "to align itself with specific blocs or find that access to certain markets." On the other hand, she believes Brazil is "well-placed to position itself as a reliable trading partner as countries seek to diversify and develop more resilient partnerships." She also discussed the re-emergence of industrial policy, the impact of digitalization on trade, and the growing interaction between trade policy and environmental policy.
Amb Alan Wolff's primary concern is Donald Trump's intention to apply 10% and 20% tariffs to all imports and 60% to US imports from China and its foreseeable consequences. Among them are whether the developed countries will follow Trump's tariffs, the possibility of Chinese retaliation, and whether the WTO will resist the gradual disintegration of the rule-based open trading system.
Prof Padideh Ala'i agrees with Amb Wolff on the challenges to the multilateral trade system ahead and shares with Prof Dadush that the system is at “a tipping point.” However, she is not sure about the shape of trade fragmentation. She underscores the role of the WTO in allowing a peaceful resolution of trade disputes. She sees open plurilateral agreements as one of the ways forward despite the resistance of a few countries (India and South Africa). Most importantly, she worries about the isolationist trend in the US under Trump, comparing it to China's approach to building economic relationships with many countries worldwide.
In closing the event, panelists reiterated their long-term confidence in the multilateral trade system's resilience. They also reinforced the need to preserve and adapt its institutions to the new international environment.
The complete recordings of both panels are available on the ABCI website.