Ben Shepherd (1999) the Principal of Developing Trade Consultants, delivers a direct assessment of the turbulent international trade environment. He addresses the fallout from US tariffs, the strain on multilateral systems such as the World Trade Organisation, and the pragmatic approaches governments are taking to manage rising uncertainty.
Tell us about your background
I’m from Australia originally and my undergraduate degree was in Law and Foreign Languages, which I took in Australia. Then I did the MPhil in International Relations at St John’s, which is what set me on course for my career. It was a very rapid one-year programme where you spend the first half doing a mix of international relations theory, politics, history, law and economics. It gave me an insight into the way global governance and global regimes work. I realised this was what I really wanted to do. I then did another Master’s, this time in Economics, at the Graduate Institute of International Studies in Geneva, and a PhD in Economics at Sciences Po Paris.
What do you do now?
I run a consultancy based in New York City, called Developing Trade Consultants, providing policy research and advice to governments and international organisations that are active in the trade space. This could include running a model for the World Bank to show the economic effects of implementing a new policy in a particular country. Or a government may come to me saying, “We’re thinking of signing a trade agreement with the country next door.
What can you tell us about the likely impacts of that trade agreement on our economy, on different sectors of activity?
Before I started the company in 2009, I was in research roles, including in the development economics research group of the World Bank. I continue to do research as part of my current role and have published about 40 papers in peer-reviewed economics journals.
Is the recent news on trade agreements and US trade tariffs a concern?
The direction we are travelling in now appears to be very negative. The US more broadly is pulling out of multilateral organisations. In trade, we try to look for some of the bright spots, and sometimes you have to look hard. One bright spot is that many of us assumed that the Trump administration would pull out of the World Trade Organisation (WTO) straight away, and they actually haven’t done that. Instead, they very quietly paid some money that they owed the organisation. That’s interesting because recently they have withdrawn from 66 international organisations, including a number of those I work with. It’s causing budgetary stress in a lot of organisations now.
What has changed?
We had a system of the law of the jungle for trade before the General Agreement on Tariffs and Trade (GATT), which came into force just after the Second World War. The GATT was a multilateral treaty designed to foster international trade by reducing tariffs, quotas and other trade barriers. It came into force in 1948 and became the World Trade Organisation in 1995. It clearly was in the interests of people when they were thinking calmly and sanely about what they wanted the trading system to look like, to have some sort of multilateral governance for it. I do think that dynamic is there to stay, but we’re going to have a rough few years before we get back to some sort of equilibrium.
This moment feels to me like we are going back in history to before the GATT where you have large countries going around, forcing people to sign trade deals that are very one-sided. There’s no legal enforcement. It’s very uncertain. It’s very inefficient for making sure that we’re opening up global markets in general, not just on a specific bilateral relationship.
What trends in global trade do you see playing out this year?
The US is signing what are called trade deals with other countries, but they are completely WTO-inconsistent because in order to be consistent you need to cover substantially all trade. If you sign a deal that’s just about cars or just about something else, then it’s obviously outside that system.
Enough people have broken their crystal balls recently that I’m not going to do that to myself. But we’ve just lived through a very uncertain year, and the early signs of 2026 are that uncertainty is possibly even going to be heightened. One thing we really need to watch is the prospect for a transatlantic trade war between the US and the EU. We saw tensions flare up around Greenland, before there appeared to be some kind of pullback. There were threats of very high tariffs, and the prospect of retaliation. If that situation comes back again during the year, we could see a major trade dispute that would have significant negative effects for the world economy as a whole.
Are countries abandoning the WTO agreements in order to lessen the impact of US trade tariffs?
There are some countries that are willing to do those sorts of limited bilateral deals with the US, more specifically with the Trump administration, but we’re not seeing that behaviour replicated everywhere. For most countries, there is still a fair level of commitment to the rules of the multilateral system, and you can see that coming out with an agreement like the European Union and Mercosur (Argentina, Brazil, Uruguay and Paraguay), which was recently signed, as well as the European Union and India. These are both major trade agreements in a global perspective. They are, as far as we can tell, WTO-consistent agreements of the type that we know and love, following decades of negotiations. The pressure on the system is encouraging countries to conclude some of these agreements that they’ve maybe been a bit slow about taking to the finish line.
What advice do you give to governments asking for help with trade strategy?
I definitely say to countries, “Don’t overreact to this, and don’t think the WTO system, the multilateral system, is dead, and that you’ve just got to go it alone.” Because I think for most countries, it is not that.
I’m also saying, “Look for advantage in the current system.” So many countries are now interested in diversifying their trade relations away from the United States. The United States is a huge market. You’re never going to get away from it entirely because it’s a substantial chunk of global trade just on its own. But many countries have the idea that it’s a risk for them to have really close ties of dependence on the US market. We’re seeing that even with a close neighbour like Canada, which is now talking to China about diversifying their trade links.
My advice is diversify the risk that you’re currently suffering, learn to manage uncertainty. And for small and medium countries in particular, I advise them to stick with the WTO as that is still your best bet of being defended against some of the very worst excesses of a kind of law of the jungle in trade. In this context, consider the United Arab Emirates – they’ve been extremely active and going all over the world, not just their region, to try and sign trade agreements with some of the major mega-regional blocks that have come up.
When you’re advising governments, with whom do you speak?
I’m not whispering in Prime Ministers’ ears. I give advice at a technical level. Part of what I offer is modelling. I’m able to design and run global trade models that will give you a sense mathematically of what the impact of a policy change or an agreement looks like. I mostly engage with technical people in ministries who are doing similar sort of work.
For me, history, current data and research come together when I’m given a policy problem. I don’t want to answer it the way people were answering it in 1974. I want to see what the best answer is in the academic literature today and then try and bring that to people who are doing policy.
Do trade tariffs benefit the US?
One of the paradoxes of trade is that when you use a trade measure to try and get the other guy to do something, you’re primarily hurting yourself. There’s a ton of analysis that shows this. In the case of the tariffs that the United States has been putting on countries, it looks like US consumers pay about 90 per cent of that. You get a little bit out of the foreign exporters, but basically, it’s a tax on your own consumers, so it makes your economy smaller. We need our large economies to be steady and growing as an anchor for the world economy. So it has pretty negative implications.
Which countries do you advise?
My main work is with low- and middle-income countries, and the implications for them of significant slowdowns in large, central economies are really terrible. A lot of these countries have become very dependent on access to those markets, and if demand starts to slip, that starts to translate into people losing jobs in other parts of the world. In circumstances where they may not have much of a social safety net, it can make people’s lives really difficult.
Where does the UK sit in all this?
Economic size counts for a lot when you’re negotiating trade agreements. When you get out of the world’s most economically integrated zone and go out on your own that that has an obvious cost. However, the UK has been successful in some respects. They’ve managed to get a number of follow-on deals after leaving the EU. So, I think that was positive. Where it really starts to bite is in dealing solo with the US. The geography and the economics are such that the relationship with Europe is always going to be extremely important. And whether it’s a relationship of membership, or of just being a good friend, that relationship is always going to be crucial.
