International Trade

after COVID-19
AN UPDATE FOR AIFC LAWYERS AND LEGAL SERVICE
PROVIDERS

www.hooktangaza.com
Overview

◆ Is World Trade in crisis?

◆ The range of responses to COVID-19
◆ The importance of law, lawyers and institutions to
global economic health
◆ How does the AIFC fit into this picture?

AIFC webinar, Alison Hook 21 May 2020

Crisis in World Trade?

Overall,
WTO
economists
forecast a
13-32%
drop in
trade in
goods as a
result of the
pandemic

Source: WTO
A warning from history – If economic
shocks turn into protectionism

AIFC webinar, Alison Hook 21 May 2020 4

 Worrying signs?

◆ Many temporary restrictions on trade (e.g. export of medical

supplies) or closing borders to movement of natural persons

◆ Cancellation of Ministerial Conference in Nur-Sultan –

consequences for progress (multilateral and plurilateral)

◆ Halt to effective negotiating activity at WTO since March

◆ Pre-COVID – collapse of Appellate Body for WTO disputes (11

December)

◆ Global trade already on the downturn in Q4 2019

AIFC webinar, Alison Hook 21 May 2020

 What can happen without rules
and co-operation?

◆ Food prices rise (e.g. rice prices up 14%, wheat price increased
10% mid-March-early April due to producer country
stockpiling). Stocks at record highs – will need to be run down
creating price instability

◆ Unequal access to essential medical supplies – 5% of world

trade is in medical products (US, Germany and China account
for 40% of global exports)

◆ Fall in economic growth and mass unemployment (IMF – global

GDP -3% , ILO - 2.7 billion workers affected, 195 m jobs lost
(doubling of global unemployment))

AIFC webinar, Alison Hook 21 May 2020

On the other hand…

” Now more than ever is the time for the

international community to step up cooperation
and coordination to protect human life and lay the
foundations for a strong economic recovery and a
sustainable, balanced, and inclusive growth after
this crisis”

G20 Trade Ministers, 30 March 2020

AIFC webinar, Alison Hook 21 May 2020 7

Some better news…

◆ EU has made standards for medical equipment open

source

◆ US removed duties on Chinese medical equipment and

PPE (reversing Regional groups share

◆ New complementary collaborations have emerged (E.g.

International Coordination Group on COVID-19 (ICGC) –
12 countries committed to learning lessons from
pandemic and developing new mechanisms (E.g. logistics
corridors)

AIFC webinar, Alison Hook 21 May 2020 8

Reasons for optimism

◆ We have stronger global institutions than in the 1920s/30s

(WTO – covers 98% world trade, 164 members)

◆ There is good commitment to them (e.g. imposition of trade

barriers temporary and notified as per WTO rules)

◆ Recognition that some missing mechanisms need solutions -

(e.g disaster cooperation, regional/thematic building blocks))

◆ Levels of interdependency (e.g. US/China PPE trade)

◆ US leadership no longer essential – (e.g. Multi-Party Interim
Appeal Arbitration Arrangement – 19 members from 30 April)

AIFC webinar, Alison Hook 21 May 2020 9

 How is this relevant to lawyers?

◆ Strength of legal texts written 26 years ago - testimony to

legal drafters – but more, new work to be done

◆ Need for more trade law expertise in more corners of the

world – especially where connected with trade finance and
potential for disputes

◆ Trade disputes likely to be more frequent, more complex but

more interesting in future.

AIFC webinar, Alison Hook 21 May 2020

And for the AIFC?

◆ Rules-based institutions combined with transparent and

appropriate but inclusive standards will be key to future
recovery

◆ AIFC is a key part of regional infrastructure connecting

into the global architecture for trade and economic
development – lawyers with trade knowledge will be
crucial

◆ WTO 12th Ministerial Meeting postponed but likely to be

held in Nur-Sultan in June 2021

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