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Skribentens bildKarl Johansson

The Relation Between Trade and Security

As I'm sure you've heard already, the US has decided to go ahead with its steel and aluminium tariffs on the European Union and Canada as well as China. Understandably America's allies are upset and I'd like to take the time to write on the relation between trade and security, as the titel of this piece states. Article XXI of the General Agreement on Tariffs and Trade (GATT) which is the foundation of the World Trade Organisation (WTO) states that:


"Nothing in this Agreement shall be construed (a) to require any contracting party to furnish any information the disclosure of which it considers contrary to its essential security interests; or (b) to prevent any contracting party from taking any action which it considers necessary for the protection of its essential security interests (i) relating to fissionable materials or the materials from which they are derived; (ii) relating to the traffic in arms, ammunition and implements of war and to such traffic in other goods and materials as is carried on directly or indirectly for the purpose of supplying a military establishment" (GATT Article XXI, 1947)


The US uses this exemption from WTO rules to justify its tariffs and this makes one wonder how security and trade intersects. Liberal theories of international relations argue that trade prevents conflicts as a highly economically interconnected world has a lot to lose from going to war. The current US government obviously doesn't subscribe to this line of reasoning as tariffs are decrease security according to liberal theory. The other major school of thought on international relations believe security and trade to be largely unconnected except for the case of strategic goods, i.e. goods which are essential to a state's ability to defend itself, and the resources needed to produce the strategic goods. Strategic goods are things like weapons, food, high technology and energy. The American government's argument for the tariffs is that unfairly cheap Chinese steel keeps the American steel indsutry weak which makes America reliant on imported steel. If foreign firms were to stop supplying the US with steel then the US couldn't produce arms which is seen as a threat to national security. This might seem to make sense but trade issues have made relations between America and her allies deteriorate so one could argue that the tariffs are a threat to national security, not because trade disincentivices war but because tariffs upset vital allies which makes America less safe.


At the end of the day it's up to each own to make up their minds about whether the tariffs are in the US' interest from a security point of view, I just hope to have provided some interesting ways to approach the issue. Perhaps even ones you hadn't considered.

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