WTO PUBLIC FORUM 2017
The opportunities that trade generates for greater growth and development and its ability to create jobs, raise incomes and reduce prices is, for some, only part of the story. There is a growing feeling that now is the time to consider the broader picture. While trade has indeed pulled millions out of poverty, the reality is that for some the experience has been different.
For many countries, trade has been an opportunity to grow, increase jobs and develop. Globally, trade has been acknowledged as an effective means of achieving a number of the United Nations' sustainable development goals (SDGs). The 2030 Agenda for Sustainable Development recognises international trade as "an engine for inclusive economic growth and poverty reduction [that] contributes to the promotion of sustainable development".
Trade is identified as playing a critical role in addressing hunger, food security, nutrition and sustainable agriculture, contributing to healthy lives and wellbeing, employment and growth. It is seen as a means of addressing inequalities and the conservation and sustainable use of the seas and marine resources. In this regard, the WTO has begun to deliver on its commitment to the SDGs. At the Nairobi Ministerial Conference in 2015, a decision was taken to abolish export subsidies in agriculture, contributing to the SDG target of "Zero Hunger". In addition, a WTO decision to ease access to affordable medicines in developing countries entered into force earlier this year, contributing to the SDG target of "Good Health and Wellbeing".
However, benefiting from trade also presents challenges. The least developed countries (LDCs), the most impoverished and vulnerable countries in the world, have over the past two decades increased their share in world exports of goods and commercial services. Despite their gradual integration into the world market, their share in world trade still stands at about 1%. According to UNCTAD's 2016 Least Developed Countries Report, poverty in LDCs "has been and remains most pervasive, with almost half of their total population still living in extreme poverty". However, challenges also apply to developing and developed countries.
Trade has provided employment opportunities for some and unemployment challenges for others. For small and medium-sized enterprises (SMEs), currently the largest global employer, and for particular segments of the workforce, such as women and young people, difficulties in accessing international markets has limited their ability to reap the benefits of trade. These are realities that cannot be ignored.
The fast pace at which the world is changing adds to the challenge. More specifically, production and consumption patterns continue to shift, ways of doing business are evolving and technology continues to advance at an unprecedented pace. In the long run, technology improves efficiency and productivity, creating new industries and opportunities. However, like trade, while it offers real opportunities, it can lead to the loss of jobs. Automation, innovation and greater productivity are responsible for the loss of four out of every five jobs in the manufacturing sector. This must be taken into consideration when assessing the complex relationship between trade and jobs.
The gains from trade cannot be argued away. Neither can the challenges. What needs to be done is ensure that trade is more inclusive and works for all, particularly the most vulnerable. Where businesses or groups of individuals are marginalised, ways to integrate them into the system should be found. More specifically, where jobs are being lost, policies that provide safety nets and support must be introduced. The Trade Facilitation Agreement, which recently entered into force, seeks to ease the participation of traders, particularly SMEs, in the global trading market. Furthermore, the agreement has the potential to provide an additional 20 million jobs — testament to the fact that trade can work.
However, the WTO cannot go it alone. The solution requires everyone, at all levels — international and national — to work together towards a fair and inclusive multilateral trading system. This can only be achieved by keeping markets open instead of raising barriers. Protectionism will only weaken a multilateral trading system that is in need of strengthening.
This year's Public Forum offers the opportunity to discuss the benefits provided by trade as well as the challenges it can bring.
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