DEPUTY DIRECTOR-GENERAL ANGELA ELLARD
Congratulations to the IOE on the launch the Business Coalition for Trade, Employment & Sustainable Development. This is an important and timely initiative that will help further strengthen the dialogue between the WTO and business, which is particularly important in the context of discussions on WTO reform. And thank you for inviting me. It is a pleasure to be with you today, albeit virtually.
I have been asked to speak about the role of trade in promoting employment and sustainable development in the economic recovery from COVID, and how business can engage with the WTO. But I would like to start with what has been on the minds of many of us since last Friday — the WTO's decision to postpone the Ministerial Conference (or MC12), which was supposed to start yesterday.
We had to take this decision due to the appearance of a new COVID variant, which would have prevented some delegations from participating in the Ministerial. This raised concerns not only about the health and safety of our participants, but also about the inclusivity and fairness of the process as well as the legitimacy of any potential outcomes.
The reaction from our Members was very supportive of the decision as the only option. And so many of them noted that we had been making much progress and had built strong momentum last week.
Now, the question is how do we maintain that momentum and build on it? Work must continue. And we must continue to keep the pressure on. We are hoping that, with this extra time, negotiators will manage to close some of the remaining gaps.
Some of you may have seen the letter of the Chair and Vice-Chairs of MC12, which proposes to convene the Ministerial in March if conditions permit, to build on our progress and finalize key priorities, particularly fisheries subsidies and response to the pandemic. This is now up to our Members to decide, but we need to keep the momentum going.
The appearance of the new COVID variant highlights once again the importance and urgency of the work that we have been doing at the WTO, particularly in the area of access to vaccines and intellectual property waiver.
Let me now turn to the issue of the role of international trade, and the WTO as its guardian, in the economic recovery from COVID, with a particular focus on employment and sustainable development.
Global rules of trade, embodied in the WTO Agreements, provide assurance and stability to economic actors across the world. On the one hand, producers and exporters know that they can source components and raw materials from abroad and that foreign markets will be open to their goods and services. On the other hand, consumers know they can enjoy a secure supply of finished products and services. This leads to a more prosperous and peaceful economic world.
Moreover, trade has a positive impact on employment and jobs. Industries dependent on international trade are major employers in advanced economies, as well as in many developing ones. For example, in the EU, extra-EU exports of goods and services support around 38 million jobs. In the U.S., one in five jobs is supported by trade. In developing countries that specialize in the production of labour-intensive goods such as light manufacturing, trade creates jobs, including for unskilled workers.
The importance of the rules-based trade has been further magnified by the COVID-19 pandemic. According to our data, in 2020, the value of global trade in goods and services in nominal terms fell by 9.6 percent, while global GDP fell by 3.3 percent. This was the most severe recession since World War II.
But the trading system has proved itself more resilient than many expected at the outset of the crisis. According to the latest WTO forecast, the volume of global merchandise trade is predicted to grow by 10.8 percent in 2021, followed by a 4.7 percent rise in 2022.
The global trading system has helped countries cope with the pandemic by facilitating access to critical medical supplies, food, and consumer goods. And WTO rules have slowed, and even prevented, countries from taking very damaging trade-restrictive measures during the pandemic.
Our Trade Facilitation Agreement, although not designed with the pandemic in mind, has played an outsized role in worldwide recovery. Countries that have embraced and rapidly implemented trade facilitating measures and infrastructure have generally proven more resilient and adaptable.
Trade can be a powerful recovery mechanism, especially for many developing and least developed countries, which have limited ability to spur economic recovery through fiscal stimulus packages. Trade increases job opportunities and access for poor households to affordable goods and services.
Trade will be at the heart of efforts to strengthen economic resilience and prepare for future crises. And it is central to building forward towards a greener, more inclusive, and digital recovery. Trade cooperation can improve the global economy's resilience to shocks by achieving more open markets and diversifying sources of supply.
To make the global system better prepared for the current and future crises, we also need a strong WTO that is equipped to face modern day challenges. In the context of the economic downturn triggered by the pandemic, the WTO's mission is as important as ever: to use trade to raise living standards, create jobs, and foster sustainable development.
But you know well that the last few years have been difficult for the WTO. We all agree that the Organization needs improvement, and the MC12, whenever it is held, will be an important milestone on the path to reform.
I’d like to conclude with a few words about how business can support the WTO and play a role in its reform. We can't take for granted that everyone believes in the value of trade and the rules-based multilateral trading system. If you value the WTO, then it is important to make the case that it is relevant and that it is worth improving and reinvigorating.
Although the WTO is an intergovernmental organization, there are several ways in which businesses can promote their interests. First, business associations are well-placed to make outreach directly with decision-makers and with the public at large. Position papers on WTO issues that many associations prepare are an effective way to make businesses' views known.
Furthermore, I would encourage you to participate in our annual Public Forum. This event regularly attracts over 1,500 representatives from civil society, academia, business, parliamentarians, and inter-governmental organizations. It provides a platform for discussing the latest developments in world trade and proposing ways of enhancing the multilateral trading system.
Finally, our Ministerial Conferences usually include business events the purpose of which is to develop private sector recommendations on priorities for the Organization. I hope to see many of you at the Business Forum of the MC12 when it takes place.
In thinking about the WTO reform, we must demonstrate where the Organization has been successful, be honest about where it has not, and be ambitious as to how we can improve it. In that discussion, businesses' views are important, and we count on your engagement. Businesses must be a voice for good, both on matters that are in their immediate interest as well as broader issues like climate change, fisheries, and access to vaccines.
This concludes my remarks. I wish you fruitful discussions and a successful event. Thank you!