Transatlantic trade policy stands at a crossroads as 2020 draws to a close. Challenged by populists across the political spectrum, disrupted by COVID-19, and potentially rendered irrelevant by the distributed digital economy, it is fair to question whether the multilateral trading framework crafted at the tail end of World War II is fit for the twenty-first century.
If the global trading system is to survive the twin challenges presented by technology and COVID-19, it must evolve.
At seventy-five years, the system was showing its age before the pandemic hit. The transatlantic community should seize the opportunity to make key changes and encourage the evolution of the multilateral trading system in four ways: accelerate supply-chain digitization, diversify supply-chains, increase standards interoperability, and engage constructively with China.
Transatlantic leadership in reimagining global supply chains and regulatory non-tariff barriers today can help address the splintering structure that, in fairness, was not built to support a digital economy.
Transatlantic policymakers have a real opportunity to rebuild and push forward a new trade policy agenda that can deliver economic growth in response to the pandemic. Choosing achievable goals can lay the foundation for a multilateral trading system that is fit to serve the needs of the twenty-first-century digital economy, and provide the foundation for a generation of cooperation that promotes real and responsible economic growth.
The global trading system marks a major milestone at an inopportune moment. At seventy-five years, the system was showing its age before the pandemic hit.
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At the intersection of economics, finance, and foreign policy, the GeoEconomics Center is a translation hub with the goal of helping shape a better global economic future.