When the global economic crisis was at its peak in 2009, international trade flows decreased by around 12% compared to 2008 as demand for goods declined. This represented the most severe slump in trade for 70 years.

Because the production of so many goods goes through extensive global supply chains, trade flows become distorted in both an economic downturn and during growth. This is because intermediate goods, or inputs, cross borders many times before the final product hits the market.

This highlights the vulnerability that poor countries are exposed to when demand in industrialised countries drops. Fortunately fears of protectionist policies being adopted by developed nations have not materialised. Nevertheless, preoccupation with individual country’s recoveries must not avert governments’ attention from what TOP feels should be the obligation of opening their markets unconditionally to the world’s poorest countries.

Not only should trade provide the platform for the world’s economy to recover, but it should be the foundation of the fight against poverty. The labyrinth of global supply chains means it is becoming even more crucial that Rules of Origin are properly addressed. Because of the combination of strict rules and complex chains, Least Developed Countries are often prevented from taking advantage of the preferential treatment that their products are due.

Summary

When the global economic crisis was at its peak in 2009, international trade flows decreased by around 12% compared to 2008 as demand for goods declined. This represented the most severe slump in trade for 70 years.

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