Economic research and trade policy analysis
Policy responses to labour market adjustment and distributional changes
If the economy is to benefit from technological change and trade workers will often have to change jobs or occupations a process which may cause dislocation for workers. The more smoothly this process takes place in the labour market the lower the adjustment costs for displaced workers and the greater the net gains to society from technological change and trade. Governments and other institutions can make the labour market more responsive to economic change through a range of measures that are targeted primarily at but not focused exclusively on the labour market. Reducing the costs of adjustment for workers can also lower public resistance to technological change and prevent the rise of trade protectionism.
Foreword
As the world becomes increasingly integrated it becomes less and less possible for different policy areas to be handled independently of each other. The linkage between trade and health has been the focus of much debate: real concerns should be dealt with and any misunderstandings should be clarified based on sound evidence and rigorous analysis.
Agriculture and trade solutions for rural poverty
Nearly 70% of the world’s poor live in rural areas and most depend on agriculture for their livelihoods (World Bank 2007b). In many poor countries agriculture accounts for at least 40% of gross domestic product (GDP) and 80% of employment. Thus agriculture plays a potentially crucial role in poverty reduction strategies. During the Green Revolution (in the 1960s and 1970s) development and aid communities stressed the relevance of this sector as an engine of growth for countries with a high proportion of rural population. However in the 1980s and 1990s the attention given to agricultural policies as catalysts for development and poverty reduction decreased significantly. Currently agriculture is once again on the forefront of development debate as recent work on the role of agriculture in development has confirmed the importance of this sector in reducing poverty (World Bank 2007b von Braun 2007 Food and Agriculture Organisation 2005).
Intellectual property rights protection: The plus/minus debate from a least-developed country perspective – sense and nonsense
This chapter asks whether distinctions exist between the original WTO least-developed country (LDC) members and the Article XII LDCs in respect of their obligations under the WTO Trade-Related Aspects of Intellectual Property Rights (TRIPs) Agreement. The chapter examines the evidence from the protocols of accession of the seven Article XII LDCs in the context of the associated treaty dialogue in their working party reports. It finds that distinctions exist and that the commitments accepted by Article XII LDCs in some respects go beyond the original requirements of the TRIPs Agreements and therefore also go beyond the TRIPs obligations of original LDC members. The chapter investigates these WTO TRIPs ‘plus’ commitments and assesses their merits in relation to the sovereign determined domestic reform priorities of the Article XII members and possible implications for the rules-based multilateral trading system. It is argued that the TRIPs Agreement is a minimum standards agreement consisting of both principles and substantive obligations with built-in flexibilities and considerable scope for interpretation and national implementation of its provisions. WTO members may deviate from these minimum standards to the extent that they benefit from longer or shorter periods of transitional relief which may vary according to an LDC member’s status as either an original member or Article XII member. Accession-specific commitments and associated treaty dialogue also show that there is implementation ‘flexibility’ on the basis of pre-determined action plans. The chapter finds that in those instances where Article XII LDCs members have undertaken legally binding commitments to implement WTO-plus obligations the substantive minimum standards of protection of the TRIPs Agreement have been increased. These WTO-plus binding commitments have been used to ‘lock in’ domestic institutional and structural reforms based on domestic development priorities to encourage innovation and attraction of foreign direct investment and they have served a domestic reform purpose to encourage innovation induce foreign direct investment and strengthen the TRIPs Agreement by increasing substantive minimum standards.
Redistribution policies in a globalized world
Does the process of economic globalization curtail the capacity of national governments to pursue autonomous economic policies at home? Does the growing cross-border mobility of factors (and its associated threat of capital flight) discipline governments and limit the level of taxes and of public spending? Is economic integration inimical to redistribution at home? If trade and financial liberalization lead to higher levels of within-country inequality (or at least the emergence of economic sectors that bear significant economic losses) can states develop economically sustainable policies to compensate those made worse off by trade reforms? In fact are there any particular policies that can make economic globalization and fair social policies at home (designed to share the gains from trade) compatible?
Remerciements et Avertissement
Le Rapport sur le commerce mondial 2017 a été établi sous la responsabilité générale de Xiaozhun Yi Directeur général adjoint de l’OMC et de Robert Koopman Directeur de la Division de la recherche économique et des statistiques. Cette année la rédaction du rapport a été coordonnée par Marc Bacchetta et José-Antonio Monteiro. Les auteurs du rapport sont Marc Bacchetta Cosimo Beverelli John Hancock Mark Koulen Viktor Kummritz José-Antonio Monteiro Roberta Piermartini Stela Rubinova et Robert Teh (Division de la recherche économique et des statistiques).
Executive summary
More than two-thirds of world trade occurs through global value chains (GVCs) in which production crosses at least one border and typically many borders before final assembly. The phenomenal growth in GVC-related trade has translated into significant economic growth in many countries across the globe over the last two decades fueled by reductions in transportation and communication costs and declining trade barriers. But at the same time it has contributed to distributional effects that mean that the benefits of trade have not always accrued to all which has at least in part been a driver in the backlash against globalization and the rise of protectionism and threats to global and regional trade agreements. In addition new technological developments such as robotics big data and the Internet of Things (IoT) are beginning to reshape and further transform GVCs. This second GVC development report takes stock of the recent evolution of GVC trade in light of these developments.
Acknowledgements
This report was jointly prepared by the World Health Organization (WHO) and the Secretariat of the World Trade Organization (WTO).
The crisis, policy reactions and attitudes to globalization and jobs
This chapter considers the effects of the financial crisis and subsequent recession on world labour markets. It begins by cataloguing the adverse effects on output of the sudden collapse in demand brought about by the financial crisis in what has come to be called the Great Recession. Next we look at the labour market and how employment and unemployment have been impacted and document the very different responses by country. We then move on to look at attitudinal indicators of the impact of the rising levels of joblessness that we observe across most OECD countries. We examine data on well-being and on attitudes to employment. We also examine a number of questions about the impact of globalization that respondents across many European countries were asked in 2008 and 2010. Finally we examine the policy responses of governments and consider what lessons might be learned from the marked differences in labour market outcomes following the recession.
Selected medium-term developments
International trade in fuels and pharmaceuticals has expanded at above-average rates in recent years affecting the structure of global merchandise trade flows. These developments are examined here.
Avant-propos du Directeur Général
Au cours des derniers mois le commerce a subi une contraction sans précédent depuis les années 30 par suite du ralentissement spectaculaire de l’économie mondiale provoqué avant tout par l’effondrement d’établissements financiers de premier plan. La croissance du commerce sera fortement négative cette année et il ne faut pas s’attendre à une reprise soutenue de l’économie avant 2010. Cette conjoncture défavorable met à rude épreuve l’ingéniosité politique des gouvernements de tous les pays et leur volonté de faire cause commune pour relever des défis partagés dans ce monde interdépendant. Une coopération internationale effective et des marchés ouverts sont aujourd’hui plus indispensables que jamais.
Avertissement
Le Rapport sur le commerce mondial et les opinions qui y sont exprimées relèvent de la seule responsabilité du Secrétariat de l’OMC. Ils ne prétendent pas refléter les vues des Membres de l’OMC. Les principaux auteurs du rapport souhaitent aussi exonérer ceux qui les ont aidés par leurs commentaires de toute responsabilité quant à d’éventuelles erreurs ou omissions.
Prólogo
El informe sobre el Comercio Mundial 2004 es 13 segunda publicación 3nual efe la nueva serle de 13 Secretarla de I3 OMC. Cerro ndipje el ano pasado el informe sobre el Comercio Mundial trata de proporcionar al público la información necesaria para comprender mer los protlemas que actualmente se plantean en la esfera de 13 política comercial y contribur así a que se examinen con mayor conocimiento de C3 usa las opciones con qje se enfrentan los gobiernos. AJ igual que el año pasado el informe empieza con un examen de la e.'clucicn reciente del comercio mundial. A ccntinjacion figuran tres ensayos mas breves: sotre preferencias comerciales el movimiento temporal de personas físicas y las indicaciones geográficas. El tema principal del informe es este ano 13 coherencia.
Trade Reform, Managers, and Skill Intensity: Evidence from India
International trade economists have long been interested in understanding the distributional implications of globalization or trade liberalization or product market competition. One of the crucial aspects of such distributional effects which have received a lot of attention especially from the 1990s onward is how such forces divide the labor pie into skilled (or nonproduction) and unskilled (or production) workers. In other words does an increase in trade participation or exposure to international markets result in an increase in returns for skilled or less skilled workers?
WTO accession and accession to the Agreement on Government Procurement: What is the relationship? Why should WTO acceding governments also consider GPA accession?
The WTO Agreement on Government Procurement (GPA) is unique in its duality as an international trade agreement that promotes and preserves market opening and as an instrument for the promotion of good governance. The recent successful renegotiation of the GPA has enhanced its coverage so that it now provides access to markets valued at US$1.7 trillion annually. In addition the text of the GPA has been effectively modernised making it more relevant economically and simplifying its implementation. Although not a substitute for domestic procurement reforms it is a catalytic and reinforcing factor for reforms that enhance transparency and competition internally – thereby yielding important gains for governments and citizens in terms of value for money in national procurement activities. Participation in the GPA can also promote inward foreign direct investment by signalling a country’s commitment to good governance and the fair treatment of all players under national legislation. The review in this chapter of the evidence from WTO and GPA accessions indicates that the WTO accession negotiations of Article XII members are often used to leverage increased GPA accessions. Specifically of the members that have acceded to the WTO pursuant to Article XII of the Marrakesh Agreement Establishing the WTO (WTO Agreement) twenty-two have undertaken GPA-related commitments and seven subsequently joined the GPA. Out of the ten WTO members that are currently seeking accession to the GPA nine undertook commitments related to GPA accession at the time of their WTO accessions pursuant to Article XII of the WTO Agreement. The chapter concludes that even though WTO accession and GPA accession are formally separate steps the basic policy decision as to whether to join the GPA is often made long before GPA accession negotiations are started at the time of WTO accession. This chapter provides countries and other WTO members considering taking on accession commitments with a strengthened understanding of the relevant benefits and costs.
La función del comercio y la política comercial en el proceso de desarrollo
Desde sus comienzos el sistema internacional de comercio ha estado configurado por una mezcla de principios y pragmatismo. Las relaciones comerciales no pueden determinarse exclusivamente sobre la base de simples principios puros definidos y acordados en los comienzos. En la determinación de las posiciones adoptadas por los gobiernos intervienen inevitablemente consideraciones prácticas y políticas y expresiones particulares del interés nacional. Algunos comentaristas reflejan esa realidad cuando se refieren a una medida o un enfoque de política del gobierno como “mala economía pero buena política”. Sin embargo gran parte de la fuerza y del éxito histórico del sistema multilateral de comercio ha residido en la disposición de los gobiernos a comprometerse previamente a observar una serie de principios y normas sostenidos por disposiciones vinculantes para la solución de las diferencias comerciales.