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EU Confirms Growing Number of Trade Restrictive Measures

Tuesday, November 18, 2014
Sandler, Travis & Rosenberg Trade Report

An annual European Union report released Nov. 17 finds that the tendency to impose trade-restricting measures remains strong among the EU’s commercial partners while efforts to remove such measures have slowed. The World Trade Organization reached a similar conclusion in a recent report examining trade restrictions imposed by G-20 member countries over the last six months. The EU report covers the period June 1, 2013, through June 30, 2014, and the following trading partners: Algeria, Argentina, Australia, Belarus, Brazil, Canada, China, Ecuador, Egypt, India, Indonesia, Japan, Kazakhstan, Malaysia, Mexico, Nigeria, Pakistan, Paraguay, the Philippines, Russia, Saudi Arabia, South Africa, South Korea, Switzerland, Taiwan, Thailand, Tunisia, Turkey, Ukraine, the United States and Vietnam.

The EU states that during the covered period these countries adopted a total of 170 new trade-unfriendly measures, an increase from the previous 13-month period. Emerging economies imposed the bulk of these measures, with Russia, China, India and Indonesia alone accounting for about half, followed by Argentina, Egypt, the U.S., South Africa, Turkey and Thailand. The stock of all such measures observed since October 2008 has now grown to 858, although 119 have been removed and others may have expired automatically.

The report finds that among all types of measures applied, border measures such as tariff increases and new import licensing procedures, reference values or minimum transaction prices have seen the most extensive use. The number of new import measures (59) was again high and reached the level of the previous year, “confirming that countries prefer quick-fix restraints to solve their domestic competiveness problems.” There was also a surge in the application of export restrictions (18, more than 39 percent of the previous total since 2008), a trend that is “particularly alarming as all countries are globally dependent on each other's natural resources.”

The report also reveals an increased number (34) of new measures applied behind the border, such as fiscal and regulatory means or local content preferences; additional restrictions in the fields of services and investment, though at a pace comparable to previous period (14 measures); and new state aid measures and financial schemes, some of which aim to boost exports.

The report adds that during the period at issue 12 pre-existing trade barriers were removed, down from 18 the previous year, and 36 trade-facilitating measures were enacted by Argentina, Brazil, China, Mexico, Nigeria, the Philippines, Russia, South Africa, Turkey and the U.S.

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