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WTO Indicator of world trade – Goods Barometer – hits record high, confirming strength of trade recovery
Saudi Arabia initiates WTO dispute case against EU duties on mono-ethylene glycol

· Joint Statement by the United States and Ecuador

WTO Indicator of world trade – Goods Barometer – hits record high, confirming strength of trade recovery[1]

Global merchandise trade is continuing its robust recovery from the shock of the COVID-19 pandemic. The Goods Trade Barometer is an indicator providing real-time information on the trajectory of merchandise trade relative to recent trends ahead of conventional trade volume statistics. The latest barometer reading of 110.4 is the highest on record since the indicator was first released in July 2016, and up more than 20 points year-on-year.

All of the barometer’s component indices were above trend in the latest month, illustrating the broad-based nature of the recovery. Indices for airfreight (114.0), container shipping (110.8) and raw materials (104.7) in particular continued to rise, signaling faster than average trade growth.

The automotive products index (106.6) also rose despite the fact that car production and sales fell in July in some countries due to a shortage of semiconductors. This shortage is also reflected in a small decline in the electronic components index (112.4).

The forward-looking new export orders index (109.3) has slowed more definitively, providing a further indication that the pace of recovery is likely to decelerate in the near term.

The rise in the airfreight index reflects a rebound in air transport due to the easing pandemic-related travel restrictions in some developed countries. The index could turn down again suddenly if the spread of COVID-19 forces the re-imposition of restrictions.

The latest barometer reading is broadly consistent with the WTO’s most recent trade forecast of 31 March, which foresaw an 8% increase in the volume of world merchandise trade in 2021 following a 5.3% drop in 2020.

Global goods trade has grown steadily since it registered a sharp decline in the second quarter of 2020 during the early days of the pandemic. The volume of merchandise trade was up 5.7% year-on-year in the first quarter of 2021, the largest jump since the 5.8% rise in third quarter of 2011. The latest barometer reading suggests that goods trade will see an even larger year-on-year increase in the second quarter once trade volume data for that period are available.

The outlook for world trade continues to be overshadowed by downside risks, including regional disparities, continued weakness in services trade, and lagging vaccination timetables, particularly in poor countries. COVID-19 continues to pose the greatest threat to the outlook for trade, as new waves of infection could easily undermine the recovery.

Full version of the publication is available here https://www.wto.org/english/news_e/news21_e/wtoi_18aug21_e.pdf.

Saudi Arabia initiates WTO dispute case against EU duties on mono-ethylene glycol[2]

Saudi Arabia has requested WTO dispute consultations with the European Union regarding a provisional anti-dumping duty imposed by the EU on imports of mono-ethylene glycol from Saudi Arabia. The request was circulated to WTO members on 19 August.

Saudi Arabia claims that the challenged measure, imposed on 10 June, is inconsistent with provisions of the WTO’s Antidumping Agreement and the General Agreement on Tariffs and Trade 1994.

Mono-ethylene glycol is a liquid used in the production of polyester fibres and film, polyethylene terephthalate (PET) resins and engine coolants.

Further information is available in document WT/DS606/1.

A request for consultations

The request for consultations formally initiates a dispute in the WTO. Consultations give the parties an opportunity to discuss the matter and to find a satisfactory solution without proceeding further with litigation. After 60 days, if consultations have failed to resolve the dispute, the complainant may request adjudication by a panel.

Joint Statement by the United States and Ecuador[3]

On August 12, the United States and Ecuador marked the entry into force of the Protocol to the Trade and Investment Council Agreement between the United States and Ecuador relating to Trade Rules and Transparency (the Protocol). The Protocol was negotiated under the auspices of the 1990 United States – Ecuador Trade and Investment Council Agreement (TIC) and signed in Quito in December 2020.

While in Quito, officials from the Office of the United States Trade Representative and the Ministry of Production, Trade, Investment, and Fisheries held meetings on a range of trade and investment-related issues, including environment, labor, trade in agriculture products, and cooperation on the challenges faced by SMEs. They also agreed to identify cooperation mechanisms for the full implementation of the provisions of the Annex on Trade Facilitation, to benefit both parties.

In the area of agriculture, the parties agreed to maintain a constant dialogue in order to develop a road map to strengthen trade flows and contribute to the development of the new agricultural policy of Ecuador.

Additionally, they discussed the critical role high labor standards play in trade relations and exchanged information on their shared vision for a trade policy that is inclusive and worker-centered. They also discussed the importance of addressing the problem of forced labor. Likewise, they confirmed the importance to each of their economies of strong environmental protections, sustainable development, and action to address global climate change.

Finally, the two sides agreed to convene the fourth Trade and Investment Council meeting before the end of the year. In addition, the countries agreed to convene the first SME Dialogue under the Protocol in the near future, benefiting from the Ecuadorian diaspora in New Jersey.

[1] https://www.wto.org/english/news_e/news21_e/wtoi_18aug21_e.htm

[2] https://www.wto.org/english/news_e/news21_e/ds606rfc_19aug21_e.htm

[3] https://ustr.gov/about-us/policy-offices/press-office/press-releases/2021/august/joint-statement-united-states-and-ecuador