The World Trade Organization reports the world economy and world trade grew robustly last year. But, it warns future economic expansion is being threatened by growing protectionism. Lisa Schlein reports for VOA from Geneva.
The World Trade Report finds the global economy grew at 3.7 percent last year, the second best performance since 2000. It says world trade grew by 8.5 percent in real terms last year.
"It is well above the average of the last 10 years where we had only a 6 percent growth in trade and now we had something between 8 and 8.5 percent," said Michael Finger, a senior economist at the World Trade Organization. "We had very strong worldwide economy, especially the developing countries have been exceptionally strong. China and India, in particular."
The report notes the U.S. economy is slowing down as the engine of global growth, while India and China continue to grow unabated. It says U.S. exports have strengthened, while imports have slowed as a result of the plunging dollar.
On January 1, 2008, the multilateral trading system will celebrate its 60th anniversary. This year's World Trade Report marks this event with an in-depth look at the system administered by the World Trade Organization.
In overall terms, the report finds the multilateral trading system has served the world community well.
Senior WTO economist, Patrick Low, says trade has grown three times faster than world output over the last six decades.
"But, there is no denying that it is a mixed picture. It is a picture of mixed success. Whilst, I think few would argue with the assertion that the GATT [the General Agreement on Tariffs and Trade] system contributed notably to the reduction of industrial tariffs and industrial countries over many years. It has been much harder in agriculture," he said.
WTO Director-General, Pascal Lamy, says the multilateral trading system, which was created after World War II, has withstood many dramatic events, such as the fall of the Berlin Wall and the financial crisis of the 1990s.
He suggest protectionist policies may have contributed to the outbreak of World War II and warns the world may forget the lessons of history at its peril. The WTO chief says the world will benefit from resisting protectionist pressures.
"Trade opening is efficient and that opening more trade means creating more wealth. That is the sort of overall view that I think is a basic ideology that WTO members share," he said.
Lamy says it is possible to conclude the current round of trade talks next year.