Trade policy critical to foster more inclusive growth and productivity

The report, by economists from the World Trade Organization, the International Monetary Fund and the World Bank, concludes that global trade policy can help to unlock opportunities provided by fundamental changes in the global economy.

A new report issued on 30 September, argues that trade integration can play a larger role in boosting shared prosperity. The report, by economists from the World Trade Organization, the International Monetary Fund and the World Bank, concludes that global trade policy can help to unlock opportunities provided by fundamental changes in the global economy.

In the report, entitled "Reinvigorating Trade and Inclusive Growth," the economists find that the opening of trade has played a key role in lifting living standards and reducing poverty since World War II, but that this work remains incomplete. Trade reform has not sufficiently kept pace with the changing landscape of services trade, digital technologies, and foreign direct investment. Much also remains to be done in areas such as market access for goods and regulatory cooperation. Greater openness in such areas, the report claims, would promote competition, lift productivity, and raise living standards. In many other domains, such as the rural economy, gender and smaller enterprises, trade-related reforms are important to foster more inclusive growth and increase productivity. Moreover, the report notes that the current trade tensions may in part be rooted in issues that have been left unresolved on the negotiating table for too long. Cooperative action to secure greater, more durable openness could help to resolve these issues.

Director General Roberto Azevêdo said, “Trade has been vital in lifting living standards and reducing poverty over the years but much more remains to be done. Many WTO members recognize that improvements are necessary in many areas of trade policy to keep up with the evolving needs of their economies and their people. This report is a welcome contribution to ongoing discussions on reinvigorating the trading system to the benefit of all".