Special Report: Global Financial Crisis

    LONDON, March 30 (Xinhua) -- "Talk globally, act nationally" is the catch phrase describing the practice of protectionism in many countries.

    Despite hindering the recovery of the global economy, protectionism continues to be adopted in some countries and is threatening to spread. How to fight protectionism seems destined to dominate the agenda of the upcoming G20 summit in London.

    British Finance Minister Alistair Darling said he would press the summit to issue a strong statement opposing trade barriers when leaders of the 20 industrial and emerging economies meet on April 2.

    Pascal Lamy, director-general of the World Trade Organization (WTO), Thursday warned against a rise in restrictive trade measures.

    "There is now a danger of an incremental buildup of restrictions that could slowly strangle international trade and undercut the effectiveness of policies to boost aggregate demand and restore sustained growth globally," he said.

    Gerard Lyons, chief economist of Standard Chartered Bank, said in an exclusive interview with Xinhua that world leaders at the G20 summit need to make clear and detailed commitments to prevent protectionism.

    Lyons called protectionism the biggest threat to the global economy.

    "The reality is that protection measures only give you short-term wins. They might help you today, they won't help you tomorrow," he said. "Protectionism isn't evil but it needs to be stopped."

    The economist suggested that a trade financing fund of about 11billion U.S. dollars be set up during the G20 summit. The money could be provided by the World Bank and other multi-lateral agencies.

    "That will be important to allow weak, poor or smaller economies to have access to finance, which is vitally important for global trade," he said.

    The WTO last week predicted a 9-percent shrink in global trade for this year, the sharpest decline since World War II. The economic downturn resulted in a mere 2-percent increase in world trade last year, a steep slide from the 6-percent rise in 2007.

    In principle, the leaders who will attend the G20 summit have realized that resorting to protectionism is counterproductive during the economic crisis, said James Auger, an HIS Global Insight analyst.

    "Therefore, we will see some strong language from the summit about this," he said.

    Emerging markets and developing countries are the biggest victims of protectionism. They will not only suffer a sharp decline in exports, but also face difficulties in future trade financing.

    Against such a backdrop, the G20 summit is obliged to concentrate on concrete measures to keep markets open and revive trade in a bid to pump new life into the stagnant world economy.