12 December, 2017 – Trade and my Breakfast

Ms. Fekitamoeloa Katoa ‘Utoikamanu – High Representative for the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States

In a famous quote, Martin Luther King once said “before you’ve finished your breakfast this morning, you’ll have relied on half the world “.

I know, early mornings are not the ideal time to ask yourself where your tea comes from or your coffee, where the ingredients of your muesli may be produced, where the banana you may eat grew and why sugar price may have gone up again. In all likeliness, you will also not ask yourself where the components of your smart phone come from.

Trade is as old as humanity. Trade has shaped societies, culture and the world economy for centuries. Trade has made and broken empires, fueled conflicts but also brought hope, peace and prosperity to communities.

The eleventh World Trade Organisation Ministerial Meeting takes place this week in Buenos Aires against a backdrop where many question the profound inequalities globalisation may have brought about. The meeting also takes place against the challenge to realise by 2030 the Sustainable Development Goals the world community agreed on in 2015.

Hopes are high for a strong commitment to a fair multilateral trading system and the Doha Development Round of Trade negations. Hopes are also high for a meaningful outcome for the world’s most vulnerable countries and their more than one billion people.

Getting trade right matters for all of us but matters even more so for the world’s poorest and most vulnerable now at risk of being left behind.

As an advocate for the world’s 91 vulnerable countries also known as the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States, I want to share a few thoughts why it ought to matter to all of us to pay special attention to the needs and complex challenges these countries face and last but not least is the utter complexity of the current multi-lateral trading system.

Take the small island developing states. Their small size, high degree of internal geographic fragmentation represent major challenges in access to global trade routes.

Yet, these small island states are also large ocean states with fishing industries. The fishing industries in small islands and least developed countries though find it challenging to compete with fishing industries from other nations benefitting from subsidies.

It is estimated that the loss in revenue from illegally harvested tuna, including by subsidised distant water fishing fleets operating in the exclusive economic zones of the pacific island states, amount to over USD$600 million a year.

Landlocked developing countries, the world’s poorest states without access to the sea, face vast numbers of miles and hours of transport required to import and export.

That is just the tip of the iceberg of the many challenges countries are confronted with and so it is no surprise that the world’s least developed countries presently account for just 1 per cent of global trade despite accounting for roughly 12 per cent of the world’s population!

History is proof that growth, the eradication of poverty and sustainable development are tied to fair, value-adding and sustainable trade.

It is for this reason that the United Nations 2030 Agenda for Sustainable Development sets an ambitious target of doubling the least developed countries’ share of global exports by 2020.

We have the signed commitments, the words and we now need the action.

Good news stories like Aid for Trade show that challenges can be overcome. Aid for Trade alone has contributed to multiple benefits for least developed and landlocked countries including lower trade costs, better customs and boarder institutions and increased digital connectivity.

Similarly, it is good news that The World Trade Organisation’s Trade Facilitation Agreement entered into force in February 2017.  This will hopefully speed up the movement, release and clearance of goods including those in transit to help reduce the high trade costs faced by vulnerable countries.

So far 124 Members of the World Trade Organisation have ratified the Agreement, including 19 landlocked developing countries and 22 transit countries.

We now need to support the Least Developed Countries with targeted capacity support as they will face several challenges to implement the agreement as financial, technical and regulatory constraints persist.

The agreement contains provisions and facilities for the expedited release of goods, the digitalization of documentation, electronic payments and international standards for import and export formalities. 

Many of the least developed countries continue to experience high costs just for broadband, lack some of the technical knowledge required and lack financial resources.

The Agreement does provide for special and differential treatment for least developed countries yet support to implement the measures must be stepped up and it is vitally important that all members of the World Trade Organisation ratify and fully implement the Agreement.

Other positive developments which still require follow through relate to the Doha agreement. 16 years ago, the World Trade Organisation met in Doha and agreed on a set of issues for negotiations. These issues included special and differential treatment, enhanced market access for goods and services, trade facilitation and sustainably financed technical assistance and capacity-building programmes. All these issues remain vitally important for the vulnerable country groups, yet few have been negotiated so far.

The promise of the 2030 Agenda to all of the world’s people is to leave no one behind. The global community must accelerate the conclusion of negotiations on the remaining issues under the Doha Development Round with high priority to securing beneficial and meaningful gains from the multilateral trading system and the global economy. The principle of special and differential treatment for the world’s poorest should be an integral part of all future negotiations and outcomes.

Important tasks remain for the 164 WTO Members. We owe it to the more than one billion of the world’s most vulnerable countries that a meaningful outcome is produced. An outcome of a fair, more inclusive and sustainable multilateral trading system will make all of us stronger and live up to the promise of leaving no one behind.

Feature Photo: Pablo Manriquez_Produce Vendor in Malabo, Equatorial Guinea_Flickr CC