There's no going back to 2019 trading system: US trade chief

US Trade Representative Katherine Tai said on Thursday that global trade policy makers should not try to recreate the pre-pandemic trading system but build one that is more resilient, sustainable and supportive of higher living standards.

Speaking in a virtual panel of the World Economic Forum, Tai cautioned against a backward-looking "return to normalcy" after two years of COVID-19-induced disruptions.

"I think that it is time for us to acknowledge that our goal really shouldn't be to try to go back to the way the world was, say in 2019, but to take lessons, very hard earned lessons, very painful lessons that we have experienced over the past two years and take this opportunity to build toward something that is different and better," Tai said.

Key to this will be to strengthen and diversify supply chains, she said.

The chairman of ports giant DP World, Sultan Ahmed bin Sulayem told the forum it could take up to two years to return to normal once the pandemic ends. 

Intel Corp chairman Pat Gelsinger, addressing the same forum, said the pandemic showed a clear need for more resilient and diversified supply chains. This should include their stress-testing for critical components the way stress-testing of financial institutions improved after the 2008-2009 financial crisis.

He said Intel was striving, with the help of U.S. and European incentives for re-shoring of chip manufacturing, for a "globally distributed, resilient supply chain where no market is uniquely dependent on any other supply, or any singular location, but there's also always a duplicity of supply chains available across the globe."
World Trade Organization Director-General Ngozi Okonjo-Iweala told the forum current disruptions in the global economy presented an opportunity to diversify supply chains to developing countries that have not benefited from previous waves of globalization.

"We see shifts to Vietnam, Laos, Cambodia, Bangladesh, Ethiopia and so on in our data and I call it a way of re- globalizing and using this globalization and supply chain to solve some of the inequality problems," Okonjo-Iweala said.

SOURCE: REUTERS