The creation of Multilateral Institutions like the WTO during the era of Globalisation was rooted in the concept of “doux commerce” given by the French Philosopher Montesquieu.
- However, in recent times, this principle has increasingly weakened.
Concept of Doux Commerce
- The idea emphasizes that trade softens behaviour, promotes cooperation, and reduces the likelihood of conflict among nations.
- It is believed that economic interests would eventually overpower geopolitical ambitions, turning integrated nations into responsible stakeholders rather than adversaries.
Why is the idea of Doux Commerce weakening?
- Interdependence seems as a Strategic Vulnerability: Heavy dependence on foreign partners can disrupt supply chains during conflicts, threatening national security.
- Weaponisation of Trade: Countries are increasingly using trade tools like tariffs, sanctions, export controls, and resource restrictions to pressure rivals and gain geopolitical advantage.
- Fragmentation of the Global Trade System: Countries are shifting from multilateral cooperation under institutions like WTO to smaller bilateral and regional trade agreements.
- Shift in Supply Chain Strategy: Countries are increasingly favouring the relocation of supply chains to allied nations (friend-shoring) or to geographically closer countries (near-shoring).
