Richard Baldwin
Abstract
This presentation examines the transformation of international trade from a vehicle of mutual prosperity into an instrument of geopolitical coercion. It starts by documenting the nature of today’s global weaponisation of trade. It shows how US tariffs and Chinese export controls on all nations combined with defensive policies in the rest of the world to weaponisation global trade. It then argues that this situation is likely to persist for the foreseeable future. Lastly, it considers where all this is going, namely how world war trade ends and what governments might do. The central scenario involves a fragile peace in US–China conflict based on “mutual assured disruption,” with the rest of the world moving on and reconstructing a rules-based “WTO 2.0” building up from the existing mega-regional trade agreements like CPTPP.