Good morning from Geneva.

On behalf of the WTO, I am very pleased to be with you in this Trade for Peace Webinar, jointly organized with the Institute for Economics and Peace. 

Introduction

To better understand the relationship between trade and peace, it is necessary to transport ourselves back to 1947.  By that year, the century had already been the bloodiest in human history. The carnage that took place in those years is now almost unimaginable. 

What was originally called the Great War, what we call World War I, ended just over 100 years ago. Last year there were commemorations for those who fought in that war.  The total number of military and civilian casualties amounted to around 40 million, consisting of 20 million deaths and 21 million wounded.  Of those deaths,  9.7 million were military personnel and about 10 million were civilians.⁽¹⁾

The short peace that followed the First World War was extremely fragile, hardly more than a prelude for what was to come which was far worse.

Between September 1939 and August 1945, an average of 27,000 people perished every day as a consequence of the Second World War.⁽²⁾  Much of the world lay in ruins.  Europe, from the Atlantic and deep into Russia in the West, and Japan and China in the East, were devastated.  20 to 25 million were killed in battle.  An estimated 50 to 55 million were civilian deaths, half from disease and famine⁽³⁾.  In addition, there were some 20 million displaced persons in Europe alone.⁽⁴⁾ 

It was the survivors of these catastrophes who created the liberal international order, of which the multilateral trading system is a key part.  To them the relationship between bringing about increased trade and maintaining the peace was obvious. No explanations were needed.
Their vision was reflected in the opening words of the 1948 Havana Charter for the International Trade Organization:⁽⁵⁾ to create conditions of stability and well-being which are necessary for peaceful and friendly relations among nations. . . . 

The signatories of the ITO Charter understood that trade does not guaranty peace.  They were realists.  They had few illusions.  After all, Germany and the United Kingdom had extensive trade before the outbreak of the First World War.  However, the architects of the liberal international order believed that trade could help maintain peace.  In this belief, in the aftermath of the Second World War, the European Coal and Steel Community and the European Common Market were formed, within the global framework of the newly established multilateral trading system.

Far too often the simplest lessons of history are forgotten or obscured by the passage of time.  When the GATT was transformed into the WTO in 1995, it was a peaceful and optimistic time following the end of the Cold War.  The founders of the WTO no longer emphasized  the relationship to peace and stability when establishing the new Organization.  Although the front entrance to the WTO building is flanked by the statues of Peace and Justice, peace was in those years not a topic often discussed in trade negotiations inside the building. 

Peace and the multilateral trading system in the present  

Just days before the lockdown in mid-March, I was in Addis Ababa with members of the WTO accessions team.  The delegation was there for a conference for the remaining countries in the African continent interested in joining the WTO.  The Ethiopian government arranged a visit for us to Unity Park, just opened and still being finished, on the grounds of the former imperial palace.  One of the buildings in the Park had once served as a prison often for political prisoners during the time of the dictator Mengistu⁽⁶⁾.  Its basement had been converted into a museum which informed visitors about the modern history of Ethiopia.  To say that this history has been hard would be a gross understatement.

• In the early 1970s, in the closing years of the Emperor Haile Selassie’s reign, there were uprisings throughout the country and in federated neighboring Eritrea.
• During the succeeding rule of the provisional military government, on one day in 1974, sixty government leaders were executed.
• There followed a period of anarchy, with an anti-government White Terror confronted by the government’s Red Terror.
•  As a result of the campaign, which continued into 1978, thousands of Ethiopia’s best-educated and idealistic young people were killed or exiled; in all, as many as 100,000 people were killed, and thousands more were tortured or imprisoned.⁽⁷⁾

• In the mid-1980s, misguided land reform and draught caused a famine and further unrest.
• Civil war followed in the late 1980s.
• A border dispute caused a war with Eritrea beginning in 1998.
• The early 2000s found a return of drought, famine and civil disorder which continued through the next decade and a half.
• In April 2018, Abiy Ahmed became Prime Minister.  He brought a measure of reduced domestic strife and concluded the 20-year war with Eritrea.  This earned him the Nobel Peace Prize in 2019.
• Ethiopia is still not free of internal problems.  According to Human Rights Watch,

[In 2019,] Ethiopia has over 2 million internally displaced people, including almost 1 million displaced in April and June due to inter-communal conflict…. In early August, at least 145,000 more people were displaced in Somali and Oromia regional states due to renewed fighting. In September, ethnic violence displaced an estimated 15,000 people from the outskirts of Addis Ababa. ⁽⁸⁾

While a Working Party was established in 2003 for Ethiopia’s accession to the WTO, it was not pursued. After an 8-year hiatus beginning in 2012, Ethiopian officials have reactivated this accession process as a necessary companion to its comprehensive domestic reform agenda,

Three of the countries neighboring Ethiopia, which are also not WTO members, are actively seeking entry into the organization.  All three — Sudan, South Sudan and Somalia — have experienced serious conflicts in recent history that rival the bloodshed experienced by Ethiopia.

War in recent times has not been confined to the Horn of Africa, nor does that region account for all of the conflict-affected countries seeking entry into the WTO.  The list also includes Bosnia and Herzegovina, Iraq, Lebanon, Libya, Serbia and Timor-Leste. 

Among the most memorable experiences that I have had at the WTO since assuming my current position was sharing much of a day with the former leader of Timor Leste, Xanana Gusmão.  Gusmão had led the insurrection that roiled that country for years, spent seven years in prison, and served as his country’s first President working toward reconciliation. He came to Geneva in 2018 to foster his country’s  economic integration into the world economy in order to bolster the cause of peace in his country. 

Speaking slowly in English, a language Mr. Gusmão had learned in prison, at the WTO’s Public Forum in October of 2018, his remarks had a profound effect on his listeners packed into a large meeting room at the WTO.  He described the enormous economic potential of conflict-affected and fragile states.  He told his rapt audience:

Trade, investment and cooperation among the countries in the world bring about prosperity and development. Trade is a peaceful alternative to War. . . . We, the fragile and conflict affected countries are committed to promote “trade for Peace”.

For me, another memorable occasion was listening to a panel on which the ambassadors of Sudan and South Sudan served, sitting next to each other, with each declaring “where there is trade there is peace”. 

Many of the 23 countries seeking to join now are characterized as fragile and conflict-affected.  Afghanistan and Liberia, which joined in 2016 have fresh experience with the trauma of war.  

In late 2017, these LDCs (least developed countries), joined by other Fragile and Conflict-Affected countries, formed the “g7+ WTO Accessions Group”, a foundation for a “Trade for Peace” initiative. 

For these fragile economies, the link of expanding their trade through integration into the world economy to their own economic growth is self-evident.  Increasing their stability and thereby improving the possibility of sustaining peace is not for them a quaint theoretical notion; it is a pragmatic policy at the core of their survival as nations.

Under the leadership of Afghanistan, the g7+ WTO Accessions Group has become a voice for fragile and conflict-affected countries in the multilateral trading system.  The group has called upon Members not to impose export prohibitions or restrictions on products which are critical to combating the COVID-19 pandemic, especially for humanitarian purposes, as well as on basic food products. 

The existence of the Group reminds us of an original raison d'être of the multilateral trading system.  When the relevance and viability of the WTO is questioned, the enthusiasm of these fragile and conflict-affected countries for the rules-based multilateral trading system should give all of us a reason for optimism.  

Need for partnership between trade and peace communities post-COVID-19

In early April, the WTO estimated that world trade is expected to fall by between 13% and 32% in 2020.  The International Crisis Group⁽⁹⁾ has concluded that the “global pandemic has the potential to wreak havoc in fragile states, trigger widespread unrest and severely test the international crisis management system.”  Experience from past outbreaks indicates that violent conflict often exacerbates the spread of infectious diseases.  This was seen in the recent resurgence of polio in Syria, a cholera outbreak in the conflict zones in Yemen, and the persistence of Ebola in insecure parts of the eastern region of the Democratic Republic of Congo (DRC).  For those fragile and conflict-affected countries, COVID-19 comes on top of existing crises that they have been experiencing, often, for too long. 

The Institute for Economics and Peace, at the launch of the latest Global Peace Index last week, underlined its belief that the pandemic, in particular its economic consequences, will likely have a severe impact on the way societies function. This could lead to deterioration in Positive Peace⁽¹⁰⁾ and increase the risk of outbreaks of violence and conflict.     

The COVID-19 crisis has made those of us in the trade and peace communities realize that there is an urgent need for collective action.  Shortages of medical supplies, disruptions in travels and global value chains, and development and distribution of vaccines, and working for global economic recovery, require heightened cooperation and coordination at the global level to minimize possible social and economic disruptions. 

Sustainable Development Goals can only be met if all relevant stakeholders work together to build a better world.  A case can be made for the establishment of a Trade and Peace Commission, drawing from expertise from both the trade and peace communities, to explore ways in which trade can foster peace.  In this context it will be essential to have the active engagement of the business community.  Peace and stability are necessary for foreign investment and trade.  They form part of a positive feedback loop, each strengthening the other. 

Value-based Multilateralism

The COVID-19 pandemic poses a series of challenges for multilateralism.  In some parts of the world, a move towards heightened nationalism and isolationism is threatened.  The need for well-functioning global economic governance has become greater and more urgent than ever.  Restoring the primacy of multilateral cooperation, based on a set of common values, will require a concerted effort and courage to introduce bold reform measures, including through strengthening of existing partnerships and forging new types of collaborations, and updating and strengthening the World Trade Organization and its rules. 

The international cooperation following World War II has given us the legacy of the multilateral system that proved itself in one of the most successful social, economic and political achievements in modern human history. It is now the turn of the current generation of leaders to leave behind a legacy even better than the one we inherited from the founders and successive generations who built the liberal international order.

Cordell Hull, a former U.S. Secretary of State, in his 1945 Nobel Peace Prize acceptance speech said enduring peace is the “overwhelming and overshadowing common interest of humanity”. “Peace” he continued, “has become as essential to civilized existence as the air we breathe is to life itself. There is no greater responsibility resting upon peoples and governments everywhere than to make sure that enduring peace will this time — as long last — be established and maintained.”

The framework offered by the IEP, the Institute for Economics and Peace, is both timely and relevant to our work at the WTO. 

According to the IEP,

Without peace, it will not be possible to achieve the levels of trust, cooperation and inclusiveness necessary to solve . . . challenges, let alone empower the international institutions and organisations necessary to address them. In the past, peace may have been the domain of the altruistic, but in the current century it is everyone’s self-interest.

. . . global challenges call for global solutions and require cooperation on a scale unprecedented in human history.⁽¹¹⁾

Peace provides an enabling environment for the global economy —  to use trade as a multiplier of economic creation and poverty reduction. 

The accession to the WTO of fragile and conflict-affected countries can remind us of the vitally important link between peace and trade.  They understand it while many of us had forgotten it.  They can provide us with a vision of hope for a better future.

Thank you very much for your interest in this extremely important topic.  I look forward to our discussion.

Notes:

1. http://www.centre-robert-schuman.org/userfiles/files/REPERES%20%E2%80%93%20module%201-1-1%20-%20explanatory%20notes%20%E2%80%93%20World%20War%20I%20casualties%20%E2%80%93%20EN.pdf back to text
2. Inferno, by Max Hastings. back to text
3. https://en.wikipedia.org/wiki/World_War_II_casualties back to text
4. https://en.wikipedia.org/wiki/Displaced_persons_camps_in_post-World_War_II_Europe#:~:text=At%20the%20end%20of%20the,and%20Jewish%20concentration%2Dcamp%20survivors. back to text
5. The ITO failed to come into being, but the General Agreement on Tariffs and Trade (GATT) was left to serve as an ad hoc arrangement of rules for international trade until the birth the WTO in 1995. back to text
6. https://www.economist.com/books-and-arts/2019/11/07/an-imperial-palace-a-prison-and-now-a-symbolic-museum back to text
7. https://www.britannica.com/place/Ethiopia/Socialist-Ethiopia-1974-91 back to text
8. https://www.hrw.org/world-report/2019/country-chapters/ethiopia back to text
9. In its own words it is an independent organization working to prevent wars and shape policies that will build a more peaceful world. back to text
10. IEP works with concepts of positive and negative peace.  For those of us unfamiliar with these terms, it is helpful to have a definition:
    Negative peace is the absence of violence or the fear of violence; it is the definition of peace that we use in the Global Peace Index (GPI).
    Positive peace is [comprised of] the attitudes, institutions and structures that when strengthened, lead to peaceful societies. . . . 
    Efforts to achieve positive peace emphasize: establishing peace through world order by supporting international law, compliance with multilateral treaties, use of international courts, and nonviolent resolution of disputes, participation in international organizations, trade, and communication, establishing social equality and justice, economic equity, ecological balance; protecting citizens from attack, and meeting basic human needs. . .
    
    The concept of positive peace involves the elimination of the root causes of war, violence, and injustice and the conscious attempt to build a society that reflects these commitments. Positive peace assumes an interconnectedness of all life.
    Quotation from: A critical analysis of Positive and Negative Peace, Oshadhi Herath Department of Philosophy, University of Kelaniya, Sri Lanka.
    http://repository.kln.ac.lk/bitstream/handle/123456789/12056/journal1%20%281%29.104-107.pdf?sequence=1&isAllowed=y back to text
11.     POSITIVE PEACE REPORT ANALYSING THE FACTORS THAT SUSTAIN PEACE
      http://visionofhumanity.org/app/uploads/2019/10/PPR-2019-web.pdf back to text