Economy

New wave of protectionism in developed economies after global slowdown: Jaitley

Surabhi New Delhi | Updated on January 17, 2018 Published on August 27, 2016

jaitley   -  BusinessLine

Yet to be seen if stance on trade pacts in run-up to the US Presidential elections translates into a governance issue, says the Finance Minister

Noting that there is a “new wave” of protectionism in developed economies in various forms such as the Brexit referendum and Free Trade Agreements after the global economic slowdown, Finance Minister Arun Jaitley on Saturday said that the stance is now also reflected in the discourse for the Presidential elections in the United States.

“How far these will remain only election issues and not translate into governance issues is yet to be seen,” he said at a conference on International Arbitration in BRICS.

Jaitley’s comments come after the Republican candidate for the US President has promised to bring back manufacturing jobs to the country and increase wages for workers and has announced renegotiation of trade deals.

In such a global scenario where “trade is shifting”, the Finance Minister called for larger economic cooperation between the five country bloc of Brazil, Russia, India, China and South Africa (BRICS) to increase trade.

He also noted that with increase in trade, there are challenges of how to resolve disputes between investors and investors and the state.

In this regard, he called for not only free trade but fair trade. “An essential part of this will be a dispute resolution mechanism and its enforceability is fair and detached from local commitments,” he stressed.

Jaitley also noted that awards given in arbitration are often loaded against developing countries and called on the BRICS countries to develop capabilities for international arbitration.

He also proposed setting up a taskforce to discuss this issue at length and set up arbitral centres. “The UNCITRAL model laws are common to most BRICS countries,” he said and noted that at present some jurisdictions have developed capacities for arbitration and tend to get a big share of international arbitration cases.

Published on August 27, 2016
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