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A GATT for the mercantilists?

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  • Trade Policy
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Intereconomics

Abstract

Since the end of the Tokyo Round six years ago, mercantilistic elements have affected an increasing proportion of world trade. Theorists and practicians alike consider that GATT, as the trade arm of the international economic order, is now in a lamentable condition and is looking increasingly like a “nonsystem”. Professor Detlef Lorenz analyses the problems of the official world trade order against the background of the new GATT round planned for 1986.

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References

  1. S. Cohen: Aspects of the New Mercantilism: Barter, Countertrade, Buybacks and Offsets. Paper presented at the conference on “Securing National Prosperity in a Changing World Economy” organised by the Friedrich-Ebert-Stiftung, May 1985, (mimeo), p. 1.

  2. UNCTAD: Trade and Development Report 1984, Part II (provisional edition TDR/4 of 17th July 1984), p. 40.

  3. As representative of many other sources, cf. W. Lütkenhorst: GATT: Caught between Self-Destruction and Reform, in: INTERECONOMICS, Vol. 19 (1984), pp. 178–187.

  4. S. Strange: Protectionism and World Politics, in: International Organization, Vol. 39 (1985), pp. 244 and 259.

  5. J. Pelkmans: The Bickering Bigemony: GATT as an Instrument in Atlantic Trade Policy. Revised paper, presented at the Euro-American Colloquium, College of Europe, Bruges, September 1984 (mimeo), pp. 5 and 21. In similar vein, H. G. Malmgren: Threats to the Multilateral System, in: W. R. Cline (ed.): Trade Policy in the 1980s, Washington 1983, pp. 196 f.

  6. As recommended in Special Report No. 3 (Lydia Dunn Study Group) of the Trade Policy Research Centre, London 1983, Chapter 5.

  7. M. Camps, W. Diebold Jr.: The New Multilateralism. Can the World Trading System be Saved? Council on Foreign Relations, New York 1983.

  8. cf. W. R. Cline, op. cit. (ed.): Trade Policy in the 1980s, Washington 1983, p. 768.

  9. With regard to the US position cf. J. van Scherpenberg: Die Außenhandelspolitik der USA zwischen Freihandel und Protektionismus, in: Aus Politik und Zeitgeschichte, Vol. 17 (1985), p. 20; see also the closing chapter chapter 22) in the important collection of essays edited by W. R. Cline, op. cit. (ed.): Trade Policy in the 1980s, Washington 1983, and the detailed review article by H. P. Gray in Weltwirtschaftliches Archiv, Vol. 121, 1985, pp. 142–150; for details on the latest situation see C. M. Aho, J. D. Aronson: Trade Talks: Opportunities and Pitfalls. Paper for National Bureau of Economic Research Conference on Current Trade Issues, Cambridge (Mass.), August 1985.

  10. It is worth noting in this connection the comments of C. M. Aho and J. D Aronson (op. cit., Trade Talks: Opportunities and Pitfalls. Paper for National Bureau of Economic Research Conference on Current Trade Issues, Cambridge (Mass.), August 1985. pp. 27f.)

  11. GATT Activities 1984, Geneva 1985, p. 15.

  12. Cf. J. Pelkmans, op. cit. The Bickering Bigemony: GATT as an Instrument in Atlantic Trade Policy. Revised paper, presented at the Euro-American Colloquium, College of Europe, Bruges, September 1984 (mimeo), p. 24.

  13. On this issue, cf. C. M. Aho, J. D. Aronson, op. cit. Trade Talks: Opportunities and Pitfalls. Paper for National Bureau of Economic Research Conference on Current Trade Issues, Cambridge (Mass.), August 1985, pp. 5 f.

  14. Compare the perhaps parallel problems of integration for the EC; E. Grabitz (ed.): Abgestufte Integration, Kehl am Rhein 1984.

  15. Cf. D. Lorenz: Ursachen und Konsequenzen des Neomerkantilismus, in: A. Woll (ed.): Internationale Anpassungsprozesse, Berlin 1981, pp. 15 ff.

  16. Cf. D. Lorenz: On the Crisis of the “Liberalization Policy” in the Economics of Interdependence in: INTERECONOMICS, Vol. 13 (1978), pp. 169 ff.; and E. Minx: Von der Liberalisierungs- zur Wettbewerbspolitik, Berlin 1980, Chapters I and III.

  17. With regard to Articles 23 and 28 see W. R. Cline, op. cit. (ed.): Trade Policy in the 1980s, Washington 1983, pp. 149 f.

  18. See the paper by J. D. Richards on, in: W. R. Cline (ed.), op. cit. (ed.): Trade Policy in the 1980s, Washington 1983, pp. 393 ff.; and H. P. Gray, op. cit. in Weltwirtschaftliches Archiv, Vol. 121, 1985, pp. 147–148.

  19. W. R. Cline (ed.), op. cit. Trade Policy in the 1980s, Washington 1983, pp. 148 and 151.

  20. If at all, “… sectoral reciprocity makes sense only where there is two-way intraindustry trade”! Cf. W. R. Cline: “Reciprocity” A new Approach to World Trade Policy?, in: W. R. Cline (ed.), op. cit. Trade Policy in the 1980s, Washington 1983, p. 147.

  21. Emphasised again recently by President Reagan; cf. Frankfurter Allgemeine Zeitung of 9th September 1985.

  22. W. R. Cline, op. cit. “Reciprocity” A New Approach to World Trade Policy?, in: W. R. Cline (ed.), op. cit. Trade Policy in the 1980s, Wahsington 1983. pp. 155 ff.

  23. For example, G. M. Grossman, J. D. Richardson: Strategic Trade Policy: A Survey of Issues and Early Analysis, Princeton 1985, and P. R. Krugman: The US Response to Foreign Industrial Targeting, in: Economic Activity, The Brookings Institution, No. 1, 1984, pp. 97–105.

  24. J. van Scherpenberg, op. cit. Die Außenhandelspolitik der USA zwischen Freihandel und Protektionismus, in: Aus Politik und Zeitgeschichte, Vol. 17 (1985), p. 26–27.

  25. D. Lorenz: Liberale Handelspolitik vs. Protektionismus—Das Schutzargument im Lichte neuerer Entwicklungen der Außenhandels-theorie in: Neuer Protektionismus in der Weltwirtschft und EG-Handelspolitik. Jahrescolloquium 1984 des Arbeitskreises Europäische Integration e. v., Baden-Baden 1985, pp. 19–25.

  26. With regard to various aspects see, for example, UNCTAD, op. cit. Trade and Development Report 1984, Part II (Provisional edition TDR/4 of 17th July 1984), pp. 41 ff.; F. Bergsten, J. Williamson, in: W. R. Cline (ed.), op. cit Trade Policy in the 1980s, Washington 1983, pp. 99 ff; s. Strange, op. cit. Protectionism and World Politics, in: International Organization, vol. 39 (1985), pp. 239 f.

  27. Cf. S. Cohen, op. cit. Aspects of the New Mercantilism: Barter, Countertrade, Buybacks and Offsets. Paper presented at the conference on “Securing National ProSperity at a hanging World Economy” organised by the Friedrich-Ebert-Stiftung, pp. 21 f. and 24. Cf. also D. B. Yoffie: Profiting from Countertrade, in: Harvard Business Review, Vol. 62 (1984), pp. 8ff.; and Countertrade: An Illusory Solution, in: OECD Observer, No. 134 (1985), pp. 24 ff.

  28. On this subject see D. Lorenz: Liberale Handelspolitik etc., op. cit Ursachen und Konsequenzen des Neomerkantilismus, in: A. Woll (ed.): Internationale Anpassungsprozesse, Berlin 1981, pp. 28 ff.

  29. GATT: Studies in International Trade, No. 5, Geneva 1977, pp. 44 ff.

  30. With regard to the causation and appropriate analysis of the adjustment problem in particular, see H. P. Gray: Free Trade or Protection: A Pragmatic Analysis, London 1985; and D. Lorenz: Ursachen und Konsequenzen etc. op. cit. Ursachen und Konsequenzen des Neomerkantilismus, in: A. Woll (ed.): Internationale Anpassungsprozesse, Berlin 1981, pp 15 ff.

  31. For an update on these problems, see E. Thiel: Industrieländerkooperation in Konfliktsituationen. Stiftung Wissenschaft und Politik, Ebenhausen, November 1983; and on the failure of summit diplomacy J. Pelkmans: Collective Management and Economic Cooperation, in: C. Merlini (ed.): Economic Summits and Western Decision-Making, London 1984, pp. 89 ff.

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  1. Free University, Berlin

    Detlef Lorenz

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Lorenz, D. A GATT for the mercantilists?. Intereconomics 20, 255–260 (1985). https://doi.org/10.1007/BF02925465

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