International trade provides important current benefits and also presents vital and dramatic opportunities.
The benefits are widely understood yet worth restating. First, it’s a means of allocating resources nonviolently across borders, based on economics rather than warfare and conquest. Second, as the populations of different countries forge trade relationships, their interdependent interests grow stronger and more salient, enhancing stability and reducing the likelihood of armed international conflict.
Trade agreements are also among the strongest vectors for implementing international governance. We can see this clearly in the history of the EU, which began in 1951 as the European Coal and Steel Community, a trade agreement limited in scope to a few commodities, and has since evolved into the continental governance bloc we see today, with shared policymaking and defense along with free movement of goods, services, and people. The EU stands today as perhaps our strongest proof point showing the feasibility of adding international governance as an umbrella while maintaining existing national and local governments.
Of course, trade agreements are rooted in economic interests, presenting an opportunity to maximize wealth. In the EU, member countries enjoy an upside worth nearly 1 trillion Euros per year. Corporations also benefit, especially from “the creation of a more predictable and transparent trading and investment environment.”
Yet these benefits are often threatened by parochial interests. US President Trump is embracing new tariffs today. At many points in the past, the stability and predictability goals of trade agreements have ironically been undermined when the players advancing them, such as certain industries or national governments, pursue self-interest too narrowly. For example, the US declined to join the proposed Trans-Pacific Partnership nearly a decade ago, amid bipartisan opposition following a secretive, closed-door negotiation process favoring big pharmaceutical companies rather than a wider set of interests. Earlier, the Seattle protests in 1999 and Mexico’s Zapatista rebellion beginning in 1994 both grew out of opposition to trade agreements favoring corporations while neglecting human needs. These examples illustrate how overreach by narrow interests can scuttle the stability, predictability, and economic growth opportunities that are the core drivers of international trade agreements.
But this pattern of failure also points to a transformative opportunity. With today’s collaborative tools, it’s not difficult to envision a process that could include whole populations in crowdsourcing potential text of future agreements. Such text would almost certainly include robust environmental, health, safety, and labor standards, and thereby gain the support of civic groups that have historically opposed prior agreements due to the lack of these provisions. With civil society on board, the stability and predictability benefits, as well as the economic upside, become far more achievable.
Truly balanced trade agreements could result, unlocking new economic gains that could be equitably taxed to distribute social investment where it’s most needed, as well as making new philanthropy possible.
This “grand bargain” scenario would also powerfully demonstrate the potential of democratically crowdsourced international governance.
Ensuring that trade agreements also include cooperation on law enforcement and asset recovery also presents powerful and mutually beneficial market opportunities for states. Strengthening international asset recovery frameworks can help repatriate stolen funds, restoring them to their rightful owners, and funding vital development priorities such as education, healthcare, and infrastructure. Countries that assist in asset recovery also benefit from more transparent financial systems, reduced reputational risk, and improved trust in their institutions. Just as open trade can create shared economic gains, so too can robust cross-border collaboration in tracing, freezing, and returning stolen assets generate win-win outcomes for global governance and economic justice.
New approaches to economic cooperation also touch on how we define economic progress. It is increasingly clear that GDP and corporate profits alone are no longer adequate measures of successful economic cooperation. Growing calls to complement and move beyond GDP – highlighted for example in Action 53 in the UN’s 2024 Pact for the Future – emphasize the importance of incorporating the economic, social and environmental dimensions of sustainable development into our metrics of progress. To meet the pressing challenges of our time, international economic governance must evolve accordingly.
| Relevant for donors, the Enhanced Integrated Framework (EIF) is a global development program aimed at assisting Least Developed Countries (LDCs) in integrating into the global trading system. It represents a partnership between various stakeholders, including donor countries, international organizations, and LDCs themselves. The EIF is supported by a multi-donor trust fund and focuses on providing trade-related technical assistance to LDCs. |