ACCORDING to the OECD, OECD, WTO and the
UNCTAD
have urged the leaders of the G20 countries to
resist protectionism or the prospects for economic recovery may be
wiped
out.
In their second combined report on G20 Trade and Investment
Measures, the
three organisations found that most G20 members were holding on to
their commitments
to open trade and investment in the wake of the global economic
crisis. However,
they say protectionist pressures may continue to gather force in the
face
of job losses and high unemployment.
The OECD
says there was no open discrimination against foreign investors in
the six
months to mid-February 2010, but warns that discretion in the
application
of the many state support and rescue programmes for troubled firms
may be
used to favour domestic companies and disguise protectionism.
The report prepared together by all the three agencies cautions that
the
holdings acquired by governments as a response to the crisis may
jeopardise
governments’ impartiality
in policy making and law enforcement. Government ownership and
rescue of
firms may also distort and protract restructuring of economic
sectors. It
also notes that recent G20 investment measures have continued to
point towards
greater openness and clarity for foreign investors.
According to UNCTAD,although G20 FDI inflows picked up in the
second and third quarters of 2009, this was not enough to offset the
huge decline that had already occurred. For the whole of 2009, G20 FDI
inflows were only $580 billion, i.e. 45 per cent less than in 2008.
The leaders of the G20, which comprises the world’s largest
economies,
committed to resist protectionism and promote global trade and
investment at
summits in November 2008, in April 2009 and again in September 2009.
They mandated
WTO, OECD and UNCTAD – the leading international organisations in
the area
of international trade and investment policies – to monitor policy
developments and report publicly on these commitments.
This second report to G20 leaders covers measures taken or announced
by G20
members between 1 September 2009 and mid-February 2010. The previous
report
was issued ahead of the G20 Summit in Pittsburgh in September 2009.
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