We are saying “no” to protectionism and isolation

The Confederation of Industry of the Czech Republic, as a representative of a mid-sized export oriented and heavily industrialized country, must advocate for free global trade.

The overall export of the Czech Republic in 2017 was approximately 160 billion EUR and the rate between the GDP and export is around 80% which makes us a really open economy, strongly dependant on export and liberal and flexible trading.

There are no doubts that competitive industry, followed by the possibility of trading worldwide without artificial barriers, is a source of wealth for us as well as for our trading partners.

We are concerned by the rising protectionism around the globe, especially in the USA, which is one of the creators of the modern rule-based world trading system. There are no winners of trade wars, but only losses and collateral damages on all sides.

It looks tempting for political leaders to protect their local producers and local markets. But in the environment of globalized complex value chains, those measures and actions need to be used very carefully and in a balanced way.

It has been proved in the past that supporting multilateralism and the WTO based trading system brings long-term profit, predictability and stability for the business and citizens. However creating tariff and non-tariff barriers, sanctioning, trade wars and unilateral restrictive actions provide nothing but very short-term advantages.

We support the EU in its effort to promote free trade not only by words, but also by actions. There are visible achievements of the EU trade policy. To name at least some of them – the signing the CETA with Canada, an FTA with Japan, concluding an FTA with Singapore or updating the trade agreement with Mexico. The FTA with Vietnam is also in the final stage of preparations, some others are so-called under construction, and some negotiations, like New Zealand and Australia are about to start.

The Confederation of Industry of the Czech Republic stays optimistic as we see a turn for the better even at the US side, where Donald Trump came to some positive results in negotiations with the EU (EC president Juncker). There are also signs that NAFTA is going to be made workable again.

We are saying “no” to protectionism and isolation. On the contrary, we want to see the world more interconnected and the economy more inclusive. Only such a setup can help to create growth, wealth and stability for people. This is the way how business and individuals can thrive.

Even though we may feel bumps and discomfort from time to time, we have to stay on this track together. The governments and business leaders must share the responsibility for keeping the world trade open. The Confederation of Industry as a proud member of the BusinessEurope family is certainly going to do so.

Official position of BusinessEurope here.

Tereza Řezníčková
section Aktuálně