Sunday, November 11, 2012

CUTS and defining the future of trade

CUTS-International is an organization that works on consumer issues as well as international trade. The website has a number of thought-provoking publications on many issue on international trade and multilateralism. The CUTS Centre for International Trade, Economics and Environment has many publications on international trade and multilateralism.

Found an interesting discussion paper on the future of trade called "Defining the Future of Trade" by Pradeep Mehta, Bipul Chaterjee, Rashid Kaukab. Pradeep Mehta is also a member of the "Panel on Defining the Future of Trade" which was constituted by the Director General of the WTO recently. I had blogged about setting up of this mulitstakeholder panel here

The discussion paper calls for a new Quad of WTO members (Brazil, U.s., EU, India and China) to stabilize multilateralism. Their assessment of the challenges for international trade:
"Trade policies of countries should be reviewed in respect to their ability to fulfill the role of trade as an effective means for poverty amelioration and reduction in income inequality leading to inclusive growth - in other words, the relationship between trade and consumer welfare (as described in the Preamble Establishing the WTO) should be the guiding principle of reviewing trade policies. 
The impact of non-tariff measures on trade under imperfect competition should be studied so as to negotiate multilaterally-agreed rules, including quantification of non-tariff measures and their gradual reduction on the basis of countries ability to reciprocate, to reduce their scope to distort trade.

Trade in tasks cannot be performed well unless there is equal emphasis on all three factors of production - capital, labour and knowledge - as their use is increasingly getting integrated, in some sense they are endogenous as well. While trade in capital and that in knowledge is drawing political attention among the policy-makers, that is not so in case of trade in labour. More emphasis on addressing labour market rigidities through trade in labour will not only strengthen the role of trade as a tool for inclusive growth but will also help poor countries to get integrated with global efforts on trade in tasks.Based on the principles of reciprocity and non- discrimination, there should be multilaterally- agreed rules to address trade-related market- contestability issues arising as a result of competition-related trade distortions and trade- related competition distortions.The WTO Secretariat should do joint studies with United Nations Framework Convention on Climate Change, Food and Agriculture Organisation and other inter-governmental organisations to understand trade and trade-related issues in governing global public goods such as climate change, food security and how the poor countries can deal with them."
Will multilateralism rise up to these challenges? 

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