jobs and growth


small business


sustainable development


global agenda

According to the World Bank, 1.4 billion people still live in extreme poverty and over 900 million—particularly women and young people—suffer from chronic hunger. Meanwhile, global population is set to rise to 9.5 billion by 2050 raising a range of environmental and social challenges.

This year sees the entry into force of the United Nations’ Sustainable Development Goals which seek to achieve three extraordinary things by 2030: end poverty, combat climate change and fight injustice and inequality.

What you might have heard…

Some interest groups argue that trade benefits big business while keeping workers trapped in poverty. Others claim that trade liberalization depletes and degrades the natural environment and is a central cause of climate change.

Climate policies are being undermined by corporate-friendly trade deals.
Naomi Klein
Author and social activist

But is this really the case?

Several landmark international agreements acknowledge that trade has an important role to play in promoting sustainability. More than two decades ago, the Rio Earth Summit recognized that international trade is a key component of sustainable development. Last year, the United Nations’ landmark agreement on development financing—known as the Addis Ababa Action Agenda—placed a central emphasis on enabling trade to deliver sustainable growth.

World Bank studies show that there is a particularly strong link between international trade, economic growth and poverty reduction. In East Asia and the Pacific, for example, outward-focused development strategies led to poverty rates being cut by over two-thirds over a 20-year period.

From an environmental perspective, trade can help achieve a more efficient allocation of scarce resources. And it makes it easier for countries—both rich and poor—to access environmental goods, services and technologies. This is particularly important given that the use of “green” technologies can be held back by barriers to trade that drive up the cost of deploying these products.

Existing global trade rules support the right of governments to take measures to advance legitimate social goals, such as protection of the environment. But they also contain important safeguards to ensure that these measures are applied in a fair way and are not used to justify arbitrary restrictions to international competition.

What next for trade?

Sustainable development is an objective of several major trade negotiations. For example, on-going World Trade Organization talks aim to remove barriers to trade in environment-friendly goods. A global agreement in this area could make a significant contribution to the fight against climate change by speeding the deployment of clean and renewable energy technologies.

There also remains significant potential to enable trade for the world’s poorest communities. So-called trade facilitation reforms—measures to reduce unnecessary bureaucracy at borders—could allow many entrepreneurs in developing economies to trade internationally for the first time. Driving poverty reduction through trade is also a major theme in several international and regional policy processes, including the United Nations’ Vienna Programme for least developed countries.


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