Economic research and trade policy analysis

The multilateral trading system is at a critical juncture. Over eight decades, it has provided comprehensive rules for trade in goods, services and intellectual property, and has delivered substantial value – in terms of reducing trade barriers, providing a predictable trade environment and supporting an almost fifty-fold expansion in global trade, growth and better living standards – but these gains have not been shared evenly, and some economies, workers and communities have benefitted more than others. By creating a more open and integrated world economy, where trade policy has become increasingly important, the multilateral trading system has also created an environment where trade frictions have become more complex, WTO membership has become more diverse and economic power has been more widely distributed. Shifts in economic power, differences in economic systems, growing government interventions, the ubiquity of global value chains, the rising importance of digitalization and artificial intelligence, environmental challenges and geopolitical tensions are testing rules designed in an earlier era. The principle of non-discrimination among trading partners, reciprocity, tariff commitments, transparency about trade measures, dispute settlement and flexibilities for developing economies remain central to trade cooperation, but they are increasingly under strain. Nevertheless, the WTO’s purpose is more relevant today than ever. The challenge now is not to preserve the status quo, but to adapt rules-based cooperation to a more integrated, multipolar and diverse global economy, so that the foundations of an open global trading system are strengthened, and the benefits of trade are shared by all.

Stablecoins have an increasingly important role in the rapidly evolving digital payments landscape, with growing potential for use in international trade transactions. Their relevance for world trade stems from their ability to support rapid, cross-border payments rather than as a replacement for traditional banking systems or trade finance instruments. This publication examines stablecoins from the perspective of international trade. It discusses their potential to reduce long-standing cross-border payment frictions, including high costs, slow settlement, limited access to payment services, and insufficient transparency, while distinguishing their payment and settlement functions from the credit, guarantees and risk mitigation provided by trade finance. The report finds that wider adoption of stablecoins depends on the regulatory environment, the interoperability with existing infrastructure, and the enhancement of technical capabilities. Particular attention is paid to developing economies, where stablecoins can offer improved access to payments but also carry risks. In addition, the report examines how the use of stablecoins could affect the efficiency, accessibility and resilience of international trade, and the conditions under which such an innovation can support the multilateral trading system.