Working Paper: CEPR ID: DP6284
Authors: Simon J. Evenett
Abstract: In recent years the bipolar multilateral trading system of the post-war years has given way to a multipolar alternative. Although many specifics have yet to be determined, some contours of this new trade policy landscape are coming into focus and in this short essay I examine their implications for the European Union's external commercial policy. Particular attention is given to both the state of business-government relations and the propensity to liberalise under the auspices of reciprocal trade agreements by Brazil, India, and China; the potential new poles of the world trading system. I consider the likely consequences of these developments, plus factors internal to both the European Union and the United States, for the possible content of future multilateral trade initiatives.
Keywords: BRICS; European Union; Regional Trade Agreements; WTO
JEL Codes: F13; F15
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Decline of the bipolar world trading system (F69) | Multipolar alternative (C59) |
| Emergence of Brazil, India, and China (F69) | Decline of the EU and US's dominance in the WTO (F69) |
| Economic reforms of Brazil, India, and China (F69) | Future roles in the WTO (F13) |
| Internal divisions and external pressures on the EU (F55) | Diminishing capacity to lead in the multilateral trading system (F13) |
| Interests of EU member states and rising influence of developing countries (F55) | Challenges to EU trade policy (F13) |
| Lack of reciprocal trade liberalization experience among Brazil, India, and China (F14) | Willingness to engage in future multilateral trade negotiations (F13) |
| Historical trade practices of Brazil, India, and China (F10) | Future WTO participation (F13) |