World trade: Have we reached peak globalisation?

As bad news is mounting concerning the health of the world trade system, one has to wonder: have we reached a peak in the globalisation process? Is there still an appetite to continue to promote international integration via the expansion of trade in the context of preferential or multilateral trade agreements? Or, have the tides changed so that we are going to witness a retreat from globalisation in parallel with the observed slow-down of international trade? Optimists argue that a debate about the future of globalisation is a waste of time. According to this perspective, growing economic integration and interdependence is inevitable, driven by technology, unilateral trade liberalisation and negotiated trade agreements. They may be right in terms of long-term trends, but one cannot forget that the same perception dominated the intellectual debate in the beginning of the 20 th century. In 1909, Norman Angell (a Nobel Peace Prize winner in 1933) published a pamphlet, that later became a popular book ( The Great Illusion ), where he argued that economic interdependence had become so pervasive in Europe, that war was very unlikely. Two world wars and policy mistakes around the Great Depression showed that predictions about a growing international...

Written by Carlos Primo Braga