Amidst the very uncertain period for trade with the recent global developments including US’s stance on protectionism or Brexit, WTO DG Roberto Azevedo, says that WTO cannot be ‘Alice in the wonderland’ with trade being the ultimate solution to all the problems. It needs to go hand-in-hand with a whole lot of other policies including social safety nets, skills, training. A lot of problems countries face today are within their own borders and need to be resolved.
“This has been a very uncertain period for the global economy with trade growth for FY16 to be around 1.7 per cent, the slowest pace of trade growth since the financial crisis. The outlook for the trade and the global flows has weakened significantly and has not returned to the pre-crisis level”.
In 2017, growth could be in the range of 1.8 per cent to 3.1 per cent, but there were a lot of risks attached, the DG said addressing at a CII Event.
“In such a fragile scenario, we hear more and more talks on inward moving policies. We must emphasise that turning into protectionism will not slow the problem of slow growth”.
“There is a false notion that trade disrupts the local markets and leads to unemployment. But trade is a minor figure in unemployment. The impact of the new technology and innovation is more significant for that matter. Studies show 8/10 jobs are lost owing to that reason and not faulty trade policies”, says Roberto.
Technological progress and higher productivity is indispensable for sustained growth and development. The DG comments on how India is undergoing a tremendous change in terms of technology with IT products and services which are becoming increasingly important to the economy. So the answer is not to reject but embrace and adapt to this technology.
“I see India as a very confident and dynamic country that is ready to do business with a lot of positive developments. The efforts are being recognised at the world stage.”
On industry discussions on the services and India taking a leading role, is commendable and welcomed, “The papers put forward by India on trade facilitation and services are very positive. It puts forward a number of ideas and challenging issues such as facilitation of movement of people, measures to support the consumption of health services, cross-border information flow, technical assistance. I look forward to more discussion”.
The DG further said India has to get other members interested in its proposal for trade facilitation in services to make it gain traction.
On finding a permanent solution to the problem of food procurement subsidies at the next WTO Ministerial Meet in Buenos Aires, the DG called for revising the proposal by the G33 group of developing nations, in order to reach a concrete decision or pact.
BW Reporters
Naina Sood is a Economics graduate and has done her post graduation in International economics and Trade. She has deep interests in Indian economy and reforms
