Trade governance needs to go beyond zero sum thinking (International Forum)

In today's complex and intertwined global industrial chain, no country can stand alone. Joining hands to establish a fair, inclusive, and sustainable global trading system is not only a moral requirement, but also a necessary path to achieving common prosperity

At the World Economic Forum Annual Meeting being held in Davos, Switzerland, the international trade order is one of the focuses of attention from all parties. Currently, the global trading system is facing a profound crisis of trust. The deep integration of the world economy and the tariff policies implemented by the United States have distorted the global trade pattern, causing varying degrees of harm to developing economies.

Unrestrained tariffs not only fail to promote economic growth, but also hinder development; Not only did it fail to encourage fair trade, but it also weaponized economic power. This policy tool demonstrates a clear double standard: some developed countries can build tariff barriers to protect their own markets while promoting free trade to developing countries. When countries in the global South attempt to implement their own tariff policies, they often face pressure, retaliation, or threats of sanctions from developed countries.

The indiscriminate imposition of tariffs distorts global resource allocation, forcing billions of people in developing countries to pay for the inflated cost of living. The industrialization process of countries in the global South is facing tariff pressure. When faced with the threat of high tariffs from the United States, Indian textile companies have to consider relocating their production bases; South African steel manufacturers losing key markets due to US tariff terms will lead to a setback in their industrialization strategy. These cases reveal a reality: tariffs have become a means for developed countries to curb the industrial upgrading of developing countries and maintain their economic hegemony. The ordinary people bear the most direct cost. According to a report from the Yale University Budget Lab, the implementation of a new round of tariffs by the US government will result in a short-term increase of 1.8% in domestic price levels, equivalent to an average loss of $2400 per household.

Faced with systemic pressures, developing countries have demonstrated resilient development strategies, such as strengthening internal connectivity through regional free trade agreements. The countries of the global South do not seek special treatment, but demand the breaking of structural discrimination and the establishment of a trade framework that truly embodies the principle of reciprocity. This not only allows latecomers to climb up the value chain, but also helps developing countries gain new momentum for sustained growth. Trade governance in the 21st century requires going beyond zero sum thinking and establishing new trade rules based on equal development rights.

In today's complex and intertwined global industrial chain, no country can stand alone. Joining hands to establish a fair, inclusive, and sustainable global trading system is not only a moral requirement, but also a necessary path to achieving common prosperity.

(The author is the President of the South African Institute of Diplomacy and the Editor in Chief of the South African Journal of Diplomacy)