The document, published at the weekend by the International Monetary and Financial Committee following the IMF-World Bank Spring Meetings, was signed by over 20 fund members spanning Africa, the Americas, Asia and Europe and including a number of the world’s most important economies.
In a reflection of the change of tone on trade in the past year, and echoing a similar watering down of trade commitments seen from the G20 last month, the communiqué said members would work to strengthen trade’s contribution to their economies and ensure a “level playing field”.
That marks a significant departure from the statement issued by the IMFC in just October last year, where members reaffirmed their resistance to “all forms of protectionism”.
Speaking on Saturday, Agustín Carstens, governor of the Bank of Mexico and current chair of the IMFC, attempted to play down the significance of the abandoned pledge.
He stressed that protectionism is a “relative term”, with all countries in the world placing some sort of restriction on trade.
“So instead of dwelling on what that concept means, we manage to sort of put in, I would say, a more positive and more constructive framework,” he said. “The membership agreed to counsel against inward-looking policies, and stressed that we should work to strengthen the contribution of trade to our economies.”
This marked a “very strong consensus”, he added. “Our final goal is, yes, to take advantage of trade. Nobody denies that.”
However the stark absence of a line that has been a regular feature of such communiqués for years will be read as more evidence of growing protectionist sentiment around the world.
This is perceived as being led by the US, where more inward-looking policies of president Donald Trump have sparked concern. The IMF, for instance, launched a number of public defences for free trade in the run up to its Spring Meetings.
The removal of commitments to resisting protectionism – as well as those on tackling climate change – from key economic governance documents coincides with the arrival of the new US administration, illustrating the ability of the Trump government to disturb what had been a long-prevailing global order.
The current membership of the IMFC includes Mexico (chair), Canada, Brazil, Chile, China, France, Germany, India, Italy, Russia, Saudi Arabia, the UK and the US.
