Opinion: World given opportunity to revive rules-based trade

Glacier FarmMedia – A couple of years ago, rules-following free traders like Canada seemed to be sadly out of step with the march of history.

China was beating down on countries like Canada and Australia for daring to anger it, nakedly weaponizing trade for political ends.

The United States was coming to the end of the first term of President Donald Trump, but the new guy probably coming in, Joe Biden, appeared likely to be just as protectionist, and maybe smarter about it.

The European Union had shown itself to be a clever games-player when implementing the Canada-EU free trade deal, scotching Canadian farmers’ hopes for new markets in old homelands. European politicians and bureaucrats suavely finessed their regulatory system to keep out Canadian food products.

All sorts of countries were trying out their market manipulation toys.

Without U.S. backing, and with Chinese hostility and European old-world duplicity sapping it, the “rules-based international order” seemed to be a failing cause for Canada and Canadian agriculture. The grim drumbeat of protectionism and great power belligerence was leading the world down a darker street than the well-lit avenue of naïve optimism we were trotting along.

Suddenly it doesn’t seem to be such a dead-end road. The U.S. hasn’t yet indulged in an orgy of NAFTA-zone protectionism, regardless of the aggressive action of domestic protectionists like R-CALF.

China, faced with drought, is realizing it needs the rest of the world’s commodities, possibly more than the exporters need to sell them. As it struggles with climate change, its population falls and its workforce shrinks, China is likely to become more reliant upon those, like Canada, that it has recently treated so shabbily.

The awe with which some in the developing world had been viewing China and other authoritarian states like Russia has abated. The chains of Chinese debt servitude haven’t worn so well. To some the Belt and Road Initiative has come to seem like the Chain and Noose.

Russia, a significant geopolitical player and a major grains exporter, has pretty much neutered itself with its Ukraine invasion. Whether or not people are OK with its unprovoked invasion of a sovereign, independent neighbour, its catastrophic failure to conquer a much weaker adversary has crippled its influence around the globe. 

Both China and India recently expressed their concerns about the Ukraine war to their big-boy buddy, no doubt rattled by Russia’s rapid loss of its geopolitical soft power.

Somehow, rather quickly, the authoritarian law-breaking tough guys don’t seem so impressive and their attraction has begun wearing thin.

Is this the opportunity to rebuild world support for rules-based international relations? (That not only includes the not-invading-your-neighbour stuff, but also trade relations that follow agreed upon terms in trade deals.)

It seems like it, if we all keep our eyes on the right prize and don’t miss the point of the moment.

Geopolitical expert Robert D. Kaplan noted a crucial distinction in the developing world’s view of the Ukraine situation, which we in the west probably don’t see clearly enough: there’s lots of support for reviving the rules-based order. There’s much less support for a global ideological struggle.

Kaplan worries that U.S. President Joe Biden’s “stressing that this is a ‘battle between democracy and autocracy’ rather than framing it as a rules-based international order versus the law of the jungle is an error,” he wrote in a piece for Bloomberg.

“For one thing, that approach has robbed the U.S. of allies in the developing world that are not democracies but might still oppose Russian aggression if the Biden administration had approached them properly since taking office.”

Kaplan notes that many non-democratic states have previously been willing to band together when the rules-based international order has been threatened (Gulf War in 1991).

They aren’t going to unite if we in the West lecture them too harshly on how we want them to run their countries.

Canadian agricultural trade has long sailed the stormy seas of global politics and fractious markets. For decades we have relied upon grain sales to some of the world’s most corrupt, authoritarian or just plain dysfunctional nations, from Iran and Pakistan to China and Mexico, and those markets have been crucial for clearing Canada’s enormous piles of surplus crops, meat and food products. 

Maintaining working relations with those sorts of countries hasn’t been easy, but Canada has been blessed with competent diplomatic and political leadership when it comes to world trade and support for the rules-based order. Canada can be a champion of democracy and human rights, but it knows it isn’t big enough to beat others into compliance. Better to be a beacon of freedom than a bugle of belligerence.

The U.S. often falls down ideological rabbit holes and can be blithely unaware of foreign sensitivities. That’s what Kaplan’s arguing at this crucial juncture in world affairs.

The world’s flagging support for rules-based international behaviour could be revived now in the context of Russia’s deflation and China’s struggles, but that opportunity could be squandered by needlessly provoking those we hope to lure back to the lawful side. 

It’s been a while since our way of doing business has seemed attractive. Let’s not blow it by lecturing our customers too much.

– This article was originally published at The Western Producer.