Free trade, the fuel that has sparked much of the global economy's growth in recent years, is in danger, says former U.S. Treasury Secretary Larry Summers.
In an opinion piece in the Financial Times, Summers wrote that many governments have become more selfish, turning their backs on free trade and their own citizens.
"While companies may compete, the premise has been that nations cooperate to build a stronger economy in the interests of all," according to Summers, now an economics professor at Harvard.
"It is no longer clear that this premise remains valid. Nations are increasingly preoccupied with their relative economic standing, not the living standards of citizens."
As a result, "Issues of strategic leverage and vulnerability now play a bigger role in economic policy discussions," he writes.
Trade certainly plays a major role in the U.S. economy. Imports and exports together account for about 29 percent of GDP.
But the flood of exports from emerging market economies in Asia, the Mideast, and Latin America is raising protectionist sentiment around the globe.
"Concern about the flow of imports from countries that have pursued a strategy of export-led growth is a big reason for the protectionist backlash now being seen in the industrialized world," Summers writes.
The United States has benefited from a surge in exports in recent months, as the depressed dollar made American goods and services cheaper in foreign markets.
But that surge may end soon, as foreign economies slow, crimping demand.
"The balance of trade may continue to show some improvement, but I think export growth probably hit a peak," David Resler, chief U.S. economist for Nomura Securities, told Bloomberg.
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