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2020 ADVISING, EMPOWERING & INSPIRING TRADE
I N T E R N A T I O N A L
TRADE
Issue 4
The Future of
Multilateralism
FORUM
FEATURE
FEATURE
Breakingthe
Breaking thecycle
cycleof
of
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poverty inGuatemala
Guatemala
SPECIAL REPORT
SPECIAL REPORT
Howinternational
How international
organizationsbuild
organizations buildback
back
better
better
ITC IN
ITC IN ACTION
ACTION
TheFirst
The FirstFlush
Flushin
in
Nepal
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© International Trade Centre, Geneva, 2020
MESSAGE FROM
Unity for the benefit of all
PAMELA COKE-HAMILTON, Executive Director, International Trade Centre
A ccording to the World Economic
Forum, by 2023, the G7 group of
industrialized nations is estimated to
The Sustainable Development Goals,
for instance, are the result of a ‘new’ form
of multilateralism, an UN-led process that
represent only one-quarter of global GDP, involves its 193 member states and global
with global growth and trade emerging from civil society.
developing countries. The United Nations is needed today
How should the multilateral system more than ever before. But it knows that it
adapt to emergent actors, interests and ideas? has to evolve. As part of its 75th anniversary,
Multilateralism has continuously evolved the UN ran a global public survey, asking over
to adapt to changes on the international 1 million people how they see the UN and the
scene. Over the past 100 years, the founding future. The majority welcomed the institution and the Deputy Director of the World Trade
principles of collective endeavour between and would like to see it become more innova- Organization. We collected the views of
countries have inspired action at an interna- tive and inclusive (see Fast Facts p8). representative from the African Development
tional level, including the establishment of the The contributions in this issue open a Bank, the Brookings Institution and academia.
United Nations 75 years ago. discussion on how a revitalized multilateralism And we gave the word to entrepreneurs from
Today’s problems transcend borders like could benefit micro, small and medium-sized Guatemala, Kenya and Nepal.
never before. One only has to look at climate enterprises (MSMEs) in the long run, as they There is hope, and there is a way,
change, migration and indeed, pandemics. are the backbone – and the future − of the they say.
Artificial intelligence, the digital revolution world’s economy. MSMEs can take advantage Join our discussion. We count on your
and going green to compete will throw up new of opportunities to enter global value chains cooperation.
opportunities – but the increasing economic and increase value addition within an effec-
inequalities will give rise to new challenges. tive multilateral trading system. However,
Responses to these concerns are not they face particular hardships in the light of
within the power of governments to deliver COVID-19, climate change and the rise of
alone. Others must rise to the occasion: the digitalization.
private sector, multinationals, international We have brought into the conversa-
organizations, non-governmental organiza- tion the Director-General of the UN office in
tions and think tanks need to become an inte- Geneva, the Vice President of Switzerland
gral part of multilateral processes.
FORUM ISSUE 4| 2020 | 3
Contents
International Trade Editor-in-Chief
Forum focuses on trade Vittorio Cammarota
promotion and export
development as part of Managing editor
ITC’s technical Evelyn Seltier
cooperation programme
with developing countries Contributors
and economies in Aasha Bhandari
transition. Matthew Brown
Gerald Daly
Published quarterly since Katie Hall
1964 in English. Homi Kharas
Moono Mupotola
See the online version at Guy Parmelin NEWS 6
tradeforum.org Waqas Rafique
Gregory Sampson
Sign up for e-mail headline Evelyn Seltier
alerts at tradeforum.org/ Temilade Sesan
alerts Sebastian Strauss FAST FACTS 8
Alan Wolff
Subscriptions Tatiana Valovaya
forum@intracen.org Anna Zampa
Print subscription Special Thanks
US$ 60/year (free to Jeanelle Clarke
trade support institutions Conik Studio
© Shuttestock.com
and firms in developing Cristina Collado Marti
countries) Ana Sophia Reyes
Judith Ueberschaer
ISSN: 0020-8957 Matthew Wilson
Address Copy editor
International Elizabeth Martinez
Trade Centre
Palais des Nations Photography,
1211 Geneva 10 art direction
Switzerland and design
Laurena Arribat
t +41 22 730 0111 Florence Gachoud
© UN/Pierre Albouy
f +41 22 733 4439
intracen.org Printer
| 14
ITC Digital Printing
Reprints
Articles from this Disclaimer
magazine may be Views expressed in Trade
freely reprinted, with Forum are the contributors`
attribution to the author and do not necessarily
and to International Trade coincide with those of ITC,
Forum, ITC. A copy of UN or WTO. Designations
the reproduced article employed do not imply the
would be appreciated. expression of any opinion
Copyrighted photos may on the part of ITC concerning
not be reproduced. the legal status of any SPECIAL REPORTS
country, territory, city
Publisher or area, or of its authorities
The International Trade or boundaries; or the
THE FUTURE OF MULTILATERALISM............................................................. 14
Centre is the joint agency endorsement of any firm Tatiana Valovaya, United Nations Under-Secretary-General, Director-General of the
of the World Trade or product. United Nations Office at Geneva
Organization and the
United Nations. SUSTAINABLE DEVELOPMENT AND TRADE:
Cover photo and all THE IMPORTANCE OF MULTILATERALISM............................................16
photos unless indicated Guy Parmelin, Vice President of Switzerland, Federal Council of Switzerland
otherwise:
© ITC
MEETING CURRENT CHALLENGES:
THE JOB AT HAND FOR THE WTO............................................................18
Alan Wm. Wolff, Deputy Director-General, World Trade Organization (WTO)
SMALL BUSINESSES KEY TO ECONOMIC GROWTH IN AFRICA.......20
Moono Mupotola, Director, Regional Development and Regional Integration,
African Development Bank
CAN MULTILATERALISM EVOLVE?..........................................................22
ITC EMPLOYMENT Homi Kharas and Sebastian Strauss, Global Economy and Development,
Brookings Institution
ITC is recruiting qualified professionals within different
areas of expertise. If you would like to contribute your
skills to increasing export competitiveness for developing
economies, and are motivated to work in an international
environment that promotes diversity, please check our
jobs website, which is updated weekly:
www.intracen.org/about/jobs
4 | FORUM ISSUE 4 | 2020
FEATURE
FROM THE GUATEMALAN HIGHLANDS
TO THE WORLD
| 10
DELIVERING AS ONE ITC IN ACTION
MAKING HEADWAY.....................................................................................24 THE FIRST FLUSH........................................................................................28
Gerald Daly, Resident Coordinator, United Nations in Bhutan Gregory Sampson, Aasha Bhandari and Evelyn Seltier, International Trade Centre
SAVING THE DAY: QUALITY CHAMPIONS IN KENYA...........................31
Waqas Rafique and Anna Zampa, International Trade Centre
| 24
INTERVIEW
© Havenhill Synergy Limited
CLEAN ENERGY: GAME-CHANGER FOR NIGERIA?.............................26
With Temilade Sesan, University of Ibadan, Nigeria
PUBLICATIONS 32
| 26
© ITC
EVENTS 34
FORUM ISSUE 4| 2020 | 5
NEWS
News Brief
New tool monitors trade-related SDGs
the United Nations Conference on Trade and development agenda from a statistical stand-
© Shuttestock.com
Development (UNCTAD) unveiled the SDG point.’
Trade Monitor to mark World Statistics Day. UNCTAD Deputy Secretary-General
The tool allows users to conduct custom- Isabelle Durant said the monitor would
ized analyses of the trade-related SDG indi- provide the most up-to-date figures, while
cators, understand the relationship between WTO Deputy Director-General Yonov Fred-
trade and development in the SDG agenda, erick Agah said it was an example of the
and assess the state of play in achieving value proposition of the Geneva trade hub.
pertinent SDG targets. The 17 SDGs provide a blueprint for
‘We all agree that trade is one of the global peace, prosperity and partnership.
A new online tool that allows users to track most crucial means of implementing the They lie at the heart of the 2030 Agenda for
progress toward the trade-related Sustainable SDGs,’ ITC Executive Director Pamela Coke- Sustainable Development, adopted by all
Development Goals (SDGs) was launched by Hamilton said. ‘The monitor will provide a United Nations Member States in 2015.
Geneva trade hub institutions on 20 October 2020. knowledge-sharing platform on which we
The International Trade Centre (ITC), can brainstorm the measurements we use,
the World Trade Organization (WTO) and and promote the case for Good Trade in the
Guide to increasing women in public
procurement launched
Public procurement accounts for almost 40% of GDP in many countries,
yet women-owned businesses make up only 1% of procurement markets
worldwide, according to a new ITC guidebook for policymakers.
The guidebook, Making Public Procurement Work for Women,
shows how policymakers, procurement officers and governments
can broaden their supplier base and include more women in direct
and indirect sourcing. It goes through options such as minimum
targets in preferential policies, subcontracting plans and focused
initiatives to build capacity.
‘Governments act as both buyers and advocates to increase
women’s participation in public procurement,’ said ITC Execu-
© Shuttestock.com
tive Director Pamela Coke-Hamilton. ‘They can lead from the
© UNCTAD
front, showing why investing in women-owned businesses through
procurement makes good business sense.’
6 | FORUM ISSUE 4 | 2020
New support for Zimbabwe farmers
A programme to boost the production and Among the programme’s priorities
export capacity of at least 600 smallholder is Zimbabwe’s horticultural sector, which
farmers in Zimbabwe has been launched by could create much-needed new jobs and
ITC and the United Kingdom. boost valuable exports.
The United Kingdom Trade Partner- Tom Hill, Director of the Foreign,
ship (UKTP) programme will help farmers Commonwealth and Development Office of
suffering from COVID-19 trade disruptions the United Kingdom and Dr. Sekai Nzenza,
and unlock economic partnership agree- Zimbabwe’s Minister of Public Service
ments with the United Kingdom and the Labour and Social Welfare, participated
European Union. in the launch with ITC Executive Director
Pamela Coke-Hamilton.
Myanmar tourism project wins award
The world’s largest global network of tourism professionals has
recognized ITC’s work to develop sustainable tourism in Myanmar
by awarding it the 2020 Skål International Sustainable Tourism
Award for community and government projects.
ITC’s Inclusive Tourism project works with traditional commu-
nities in Myanmar to improve and integrate their tourism offer and
ensure secure and decent employment. The Netherlands govern-
ment funds the project under its Netherlands Trust Fund Phase IV
(NTF IV) scheme.
Starting in Kayah state, ITC has rolled out the project and its
methodology to several regions in Myanmar since 2013.
The Skål International Sustainable Tourism Awards enhance
the visibility of and grant recognition to entities in the travel and
tourism industry.
Now in its nineteenth edition, the competition received 44 entries
from 23 countries for nine categories. The jury comprised interna-
tionally recognized experts who independently evaluated each entry
based on leadership criteria in sustainability.
Trade intelligence platform now in Arabic
The Global Trade Helpdesk, a free online QDB chief executive officer Abdulaziz
platform that helps maximize trade oppor- Bin Nasser Al-Khalifa said: ‘We are pleased
tunities for SMEs in global markets, is now to announce this unique partnership and
available in Arabic. provide entrepreneurs with a new tool
The Qatar Development Bank (QDB) that adds value to the long list of tools and
supported the Arabic-language iteration of services provided by QDB through its
the platform, which is jointly run by ITC, the various programmes, departments, and
WTO and UNCTAD. affiliate institutions.’
ITC Executive Director Pamela Coke- The platform allows users to explore
Hamilton said the platform would help SMEs import values, export potential, tariffs, market With Arabic, the Global Trade Help-
weather the COVID-19 storm. access conditions, export and import proce- desk is now available in five official United
‘SMEs are the foundation of the global dures, intellectual property rights protection, Nations’ languages, including English,
economy, and ensuring an inclusive recovery connect with trade finance providers and French, Spanish and Russian.
depends on our ability to help them effectively find potential business partners.
engage in the global marketplace,’ she said.
FORUM ISSUE 4| 2020 | 7
FAST FACTS
What is...
Multilateralism?
Multilateralism is the process of organizing relations between groups of three
or more states. Generally considered to comprise certain qualitative elements
or principles that shape the character of the arrangement or institution. Those
principles are an indivisibility of interests among participants, a commitment to
diffuse reciprocity, and a system of dispute settlement intended to enforce a
particular mode of behaviour.
Source: Britannica Encyclopaedia
Thanks to multilateralism, trade liberalizing
measures spurred growth in trade and GDP
Economic growth further enabled
reducing trade barriers
Tariffs on manufactured goods
among developed countries had fallen
from
over 40%
in late
l940s to
less than 5%
Perceptions of the UN by end of
20th century
Over 1 million people from around the world say:
87% global cooperation is vital to deal with today’s challenges
6 in 10 the UN has made the world a better place
74% see the UN as “essential” in tackling future challenges
UN needs to change and innovate
to be more inclusive of the diversity of actors in the 21st century
and to become more transparent, accountable and effective
Looking to the future, climate crisis is an overwhelming concern
Source: UNOG https://www.un.org/en/un75/presskit See more results from
the #UN75 survey
8 | FORUM ISSUE 4 | 2020
Multilateralism over time
1815 1884 – 1885
Vienna Congress Berlin Conference
Restored balance of power. Initiated ‘Concert of
Europe’ and prepared the ground for major inter-
national congresses in second half of 19th century.
1930 1920 1899 – 1907
Bank of International Settlements League of Nations Hague Peace Conferences
The oldest of global financial institutions First intergovernmental organiza-
and constitutes a forum for international tion to foster world peace and
monetary cooperation. cooperation among member
states. Failed in the late 1930s with
United States never becoming a
member.
1947
1945 General Agreement
United Nations (UN) on Tariffs and Trade (GATT)
Established as a successor to League of Nations. Signed by 23 countries at that time,
Operates through 5 organs. It is the largest and a legal agreement to boost economic
most influential institution of global governance. recovery after WWII through set of
multilateral agreements eliminating
or reducing quotes, tariffs, subsidies.
1961
1963 Organisation for
Organisation of Economic Co-operation 1957
African Unity (OAU) and Development (OECD) Treaty of Rome
Replaced by the African
Union in 2002.
1964
United Nations 1967
Conference on Trade 1964 Association of Southeast
and Development (UNCTAD) Group of 77 (G77) Asian Nations (ASEAN)
Established by 77 countries by first UNCTAD
session to promote collective economic
interests, joint capacity at UN and facilitate
South-South trade. Now has 135 members.
1991
1999 1994 Southern Common
Group of Twenty (G20) World Trade Organization (WTO) Market (MERCOSUR)
International forum of world’s largest With 164 member states, largest economic international
economies. Not being a legislative body, organization worldwide.
its agreements are non-binding but exert
major influence on global governance.
Source: https://globalchallenges.ch/issue/7/multilaterism-is-in-crisis-or-is-it/
Copyrights of pictures from top to bottom: Vienna Congress: Shutterstock – Berlin Conference: Zz1y Draner / CC BY-SA – Woodrow Wilson 1919, Library of Congress, Prints & Photographs
Division, Photograph by Harris & Ewing, reproduction number LC-USZC2-6247 – Sanjitbakshi via Flickr / CC BY 2.0 – Immanuel Giel / CC BY-SA 3.0
FORUM ISSUE 4| 2020 | 9
FEATURE
From the Guatemalan highlands
to the world
EVELYN SELTIER, Associate Public Information Officer, International Trade Centre
How can we break the vicious cycle of poverty?
Ana Sophia Reyes knows how: connecting traditional artisans in Guatemala with
customers in Europe. This solution reflects how important it is to know your
marketplace so women in minority communities can receive a fair salary.
I t seems to have been fate when back in
2014 Ana Sophia Reyes and her partner
Juan Augusto visited the touristic area
$25 for a living room rug does not make
any sense.
Transform, sell, and live well…
Ana Sophia Reyes has always had an entre-
of Lake Atitlán in Guatemala’s south- Minority communities of Mayan descent in preneurial spirit. An industrial engineer
western highlands. the remote regions of Guatemala often are by profession, the Guatemalan executive
Local artisans swarmed across the forced to choose between preserving their wondered:
area trying to sell their handmade goods of traditions and making a decent living. ‘How do you seize strengths and
Mayan tradition. Nothing unusual. address weaknesses? I like to look for tools
‘But what was shocking to us was they that can help businesses overcome chal-
Their work and talent are not valued
kept reducing the price for their high-quality lenges.’
enough in the local market.
rugs so that we would finally agree to buy. With Juan Augusto working in the busi-
This was not about making a decent living ‘So many are born into a poor economic ness of high-quality rugs and knowing its
anymore. This was about pure survival.’ situation’, explains Ana Sophia. How do you potential for high-end markets, it was only
After talking to the artisans about the break out and create jobs that pay? a matter of time before Ana Sophia and
time and money they invested in producing Juan Augusto founded their own company,
the rugs, and weighing up costs such as Achiote.
transport, the couple thought:
10 | FORUM ISSUE 4 | 2020Achiote Guatemalan Goods promotes Achiote has connected over 50 artisans, But finding the right market is not an easy
the rich Mayan talent and tradition of hand including 35 women, from seven commu- task.
weaving – and at the same time improves nities in rural areas such as Totonicapán,
the living conditions of weavers from indig- Momostenango, Tactic, San Juan Coma- ‘Of course, the best way to look for markets
enous communities, especially women. lapa, San Cristóbal Cucho, San Antonio outside of Guatemala is through a website.
Palopó and San Pedro Sacatepéquez. These And after nine months, we finally managed
communities all have different skills that to integrate payment solutions on the site.
‘We are convinced women are the agents
Achiote integrates into its process of trans- But then – we didn’t sell one single rug!’
of change in our society.’
forming natural goods into commercially Achiote reoriented itself and started
Ana Sophia explains that in traditional viable products. producing bags, selling in batches.
weaving at Momostenango, women are in ‘We add value to the products, so they ‘When the International Trade
charge of spinning the yarn and dyeing. As become durable and functional, for example Centre launched a project for women
this is part of their household duties, they transforming the wool so that it never loses doing e-commerce in Central America,
are not paid. its shape. Then we try to find wholesale I was happy to learn how to improve our
‘We recognize and remunerate the markets that pay an adequate price for such trading techniques and to sell more prod-
value that each person adds to the produc- quality products.’ ucts successfully. The European Market has
tion. We don’t only pay the women in the always attracted us – and we wanted to
community; we also give them the skills to reach that market.’
become successful in business.’
FORUM ISSUE 4| 2020 | 11FEATURE
Certificates of origin: A great ‘And most importantly, we learned pieces – to create a sense of order in a life
marketing tool about online marketplaces where we can of chaos.
have our own little shops.’ Within three months, Achiote launched
The project has helped Achiote develop five new product lines to expand their pres-
To sell successfully overseas, make use of an international e-commerce presence with ence on e-commerce platforms across as
commercial agreements a transactional website, an eBay store, an many categories as possible.
The company was able to obtain a certifi- Etsy store, and being now one of the best
cate of origin to benefit from the European international sellers at Faire, an online
‘Times are challenging but you learn about
Union-Central America Association Agree- wholesale marketplace.
yourself.’
ment to sell to European customers at a 0% ‘However, the last six months have
tariff rate. Especially for business-to-businessbeen tough because many of our potential Just as for other small businesses around
transactions, the certificate of origin is a keyclients in Europe backed off. In February, the world, the economic consequences
requirement for placing orders. just before the lockdown, we participated in of the pandemic were not easy on Achi-
‘For an importer it makes such a differ- the AMBIENTE fair in Frankfurt, our first in ote’s producers. Connecting the artisans
ence to not pay tariffs – not only that: you Europe. We established many connections, to governmental aid programmes was
can also avoid tedious customs processes. but customers have only reconnected with not enough.
It takes some perseverance to receive a us since August.’ The company stocked raw materials
certificate for each product line, but if you to keep paying the artisans. Achiote’s core
want to reach as many clients as possible, existence derives from being socially respon-
Keeping on top of things
e-commerce partnership agreements are a sible – which, as Ana Sophia believes,
life saver.’ After AMBIENTE, customers cancelled many should be the guiding principle for all busi-
of the orders promised during the fair. nesses around the world.
‘The challenge was to keep selling prod-
Mastering e-commerce
ucts while the public changed its priorities.
‘In the end, we are all in this together, no
Through the e-commerce project funded by How do you move past a crushed market?’
matter what we do. We understand that
the European Union, Ana Sophia learned Ana Sophia and Juan Augusto put on
wherever we move and whatever we
how to stay true to Achiote’s brand voice their innovative hats and asked themselves:
do, we make an impact. And we strongly
and make the most of e-commerce tools – what are people looking for now? Goods
believe in this.’
from search engine optimization, commu- which make you more comfortable at home
nicating an inspiring and human story, to but are not too expensive.
improving picture quality and seizing the That is why they started diversifying,
power of social media. from producing safe cloth facemasks to
blankets, scented candles and organizational
12 | FORUM ISSUE 4 | 20201+ 2. Weaving is a Mayan tradition in Guatemala. 5. Combining tradition with innovation 10. Achiote now has several online presences for
3. Ana Sophia (right) explaining the last finishing 6. Storage facilities before sending off to European e-shopping, for example at shopachiote.com
touches for Achiote organizational products markets 11. Ana Sophia proudly shows her Certificate of
4. Achiote has its workshop in Guatemala City while 7 + 8. Scented soy candles and organizational pieces Origin for her handwoven bags which is crucial when
sourcing from artisans across numerous Guatemalan are part of Achiote’s new product line selling to European buyers
regions in the highlands 9. Achiote Guatemalan Rugs is where it all started
FORUM ISSUE 4| 2020 | 13SPECIAL REPORT
The future of multilateralism
TATIANA VALOVAYA, United Nations Under-Secretary-General, Director-General of the United Nations Office at Geneva
© UN / Violaine Martin
© UN / Violaine Martin
How international organizations are vital to building back better
W orld leaders came together 75 years
ago and created the United Nations
and its related organizations to
against a modern-day version of the four
horsemen. Geopolitical tensions, the climate
crisis, global mistrust and the dark side of
of geopolitical tensions, as well as great
asymmetries and fragmentation at all levels.
Growing global mistrust, nationalist senti-
prevent the breakdown of global coopera- technology are the looming global threats ments and protracted trade tensions add
tion and the resulting chaos and carnage from which endanger 21st century progress. They to the fragility of our global structures and
happening again. are nurtured by entrenched poverty and weaken the global growth outlook. Our
Extraordinary achievements have been inequalities within and among many coun- progress on eradicating poverty, creating
made since then: Living standards, measured tries, a result of the unequal global distribu- decent jobs and achieving the Sustainable
by indicators such as life expectancy, infant tion of economic benefits. Development Goals is severely threatened.
mortality and literacy, have all improved. The COVID-19 pandemic has added to
Landmark decisions on environmental these pre-existing threats, with the world’s
Our UN75 dialogues show: Most people
protection and human rights, comprehen- poorest and most vulnerable affected the
believe in cooperation and want a
sive trade agreements as well as important most. In the economic sphere, the disrup-
reinvigorated multilateralism
health advancements have been achieved. tion caused by the pandemic has taken the
The multilateral system has underpinned greatest toll on small and medium enter- Despite the dark picture I am painting, there
much of that success as it laid the basis for prises due to their lower resilience and is reason to be optimistic: Indeed, the current
joint agreements and cooperation. insufficient financial support. crisis can unite us and ultimately strengthen
The past months have been a powerful multilateralism. Our challenges are urgent
reminder of the magnitude of risks if we and complex, and they endanger the global
21st century challenges put the multilateral
allow climate, economic and social crises commons – but they can be resolved.
system to a critical test
to deepen over time. The wake-up call for Our worldwide dialogue this year
Despite these achievements, the number renewed and improved collective action organized as part of the UN75 initiative
of challenges has also multiplied over the could not be clearer. shows that there is global support for a rein-
past decades. At the start of this year, UN Unfortunately, what we have been vigorated multilateralism. The vast majority
Secretary-General António Guterres warned witnessing instead has been an escalation of respondents see the value of cooperation
14 | FORUM ISSUE 4 | 2020© UN / Violaine Martin
to solve the challenges ahead – from global However, we, the United Nations knowledge hub of international activity and
health, to climate change and conflicts. An and its related institutions, cannot lead includes diverse voices in the fields of trade,
important priority for them is to rethink the the reform of the multilateral system by economics, decent work, development,
economy, to build a more inclusive version ourselves. We need the political will, deter- humanitarian action, human rights, health
of it and to rebalance the relationship mination and funding of Member States – and climate, among others. The Palais des
between economic growth, environment but also of other, new actors – to keep our Nations is a pulsating conference centre
and public priorities. promise to future generations. that hosts over 12,000 meetings per year,
Building on this global support, it is I firmly believe that there is a clear of which many address critical issues related
time to reconceptualize our tools. I foresee rationale for global cooperation. Taking the to economics, trade, and small and medium
at least three changes required in our multi- example of small and medium enterprises: enterprises. International organizations such
lateral system. without support for them, 90% of the world- as the International Trade Centre with its
First, a new form of inclusivity. Inter- wide firms and around 70% of total employ- crucial role for small businesses, the Inter-
national decision-making needs to include ment are at risk with devastating trickle- national Labour Organization, World Trade
the voices of not only governments, but also down effects on other sectors. Many small Organization, or the UN Conference on
of local and regional actors, civil society, the and medium enterprises are in the forefront Trade and Development are well equipped
business community, academia and others of innovations which are key to our vision to support the Sustainable Development
who are often overlooked, young people of a more equal, prosperous and sustain- Agenda. All of us can harness Geneva and
and women being the prime example. able planet. The United Nations is actively its unique environment to forge new syner-
Second, more networked problem- advocating for decent jobs and inclusive gies and put the concerns of those in need
solving instead of unilateral approaches. growth, a worldwide green deal and sustain- on the international agenda. Now is the
The most serious challenges ahead of us are able economic activities. However, it is only time when joint action counts.
transnational in nature. The mechanisms for through the joint efforts and networked
global governance need to function in a way expertise of political, business and commu-
that brings different actors and communities nity leaders that we can be successful. 1. Tatiana Valovaya, Director-General of the United Nations
Office at Geneva, at the 2019 Innovations Dialogue, Digital
together to nurture and inspire each other as
Technologies and International Security at the Palais des
well as to create sustainable solutions.
International Geneva: A city that shows Nations
Third, multilateralism must become
the UN’s relevance, best equipped to 2. The Palais des Nations is the location of choice for
more effective. The international system, Member States, NGOs, businesses, and many other
foster the change we need
including the workings of the United stakeholders to discuss issues such as trade, human rights,
Nations, needs to be closer to all interested If we look at the requirements for a new peace or sustainable development
stakeholders, to allow for inclusivity, innova- multilateralism, we see that International 3. The 2019 Innovations Dialogue, Digital Technologies
and International Security: One of many events at the
tion and partnerships. New digital solutions Geneva is well equipped to lead by example
Palais des Nations on new digital innovations and their
can help us in meeting this requirement. and is already doing so. Our host city is a global impact.
FORUM ISSUE 4| 2020 | 15SPECIAL REPORT
Sustainable development and trade:
The importance of multilateralism
GUY PARMELIN, Vice President of Switzerland, Federal Council of Switzerland
© WBF
© Shutterstock
T his year we are all celebrating both the
75th anniversary of the UN and the 25th
anniversary of the World Trade Organi-
the resolution of global challenges, which is together, to think and innovate to find global
in the interest of both the Swiss people and solutions satisfactory to all.
the world population. The many international organizations
zation (WTO). The Charter of the United present in Geneva are at the forefront of the
Nations was signed 1945 at the San Francisco response to this crisis, in the fields of health,
Multilateralism offers legitimacy to find
Conference. Delegates from 50 states drafted human rights, humanitarian action and
global solutions
it with the aim of maintaining peace, guaran- trade, among others.
teeing international security and promoting The progress made in several fields and the
the development of friendly relations management of various crises over the last
Settle trade disputes through the rule
among nations. 75 years have shown us that there is no
of law
It is important to emphasize that the alternative to multilateral cooperation and
principles on which the UN Charter is based that none of the great challenges of our time Twenty-five years ago, 128 countries joined
coincide with Swiss values enshrined in the can be addressed by a single state or group forces to create the World Trade Organization.
Federal Constitution. Switzerland has distin- of countries. Multilateralism offers unique Beyond this multilateral success story, the
guished itself in particular in the promo- legitimacy and unparalleled expertise. birth of the WTO was also a victory for inter-
tion of international humanitarian law and We must therefore learn from past experi- national law, because its agreements and
human rights, as well as in fostering peace ences and further strengthen our capacity dispute settlement mechanism have made it
and sustainable development. Switzerland to negotiate, decide and act. At the time of possible to settle hundreds of trade disputes
is also appreciated for its good offices and the 75th anniversary of the United Nations, through the rule of law. The predictability
its role as mediator in difficult negotiations. the response to the COVID-19 pandemic and transparency provided by this system had
As a member of the UN, we contribute to demonstrates once again the need to act a greatly positive impact on the international
16 | FORUM ISSUE 4 | 2020© Shutterstock
economy since that time. The WTO and its micro, small and medium-sized enterprises Trade platforms to exchange strategic ideas
rules limit the recourse to protectionism and in developing countries, helping them to
the law of the strongest. In the short and connect to the global economy. Its goal is To support states and international organi-
long term, international trade is therefore to generate employment opportunities and zations in their actions, Geneva offers
an indispensable factor for growth and pros- promote a more diversified and sustainable cooperation platforms that promote exchanges
perity. Today, almost all states are members economy through trade and investment. and synergies between them, but also with
of the UN, 164 are members of the WTO, The support that this organization provides actors from the academic world, civil society
and their representatives discuss and solve to many small and medium enterprises in and the private sector. For example, this year
global problems together. fragile economies is crucial in the context of saw the creation of a trade platform within
Switzerland is proud to host the Euro- the COVID-19 pandemic. the Graduate Institute, which enables trade
pean headquarters of the United Nations as We are convinced of the important role policy actors to exchange, develop, test and
well as the headquarters of the WTO. As of trade in the response to the many global disseminate strategic ideas, based on concrete
the host country, we are pleased with the challenges, be it the current pandemic, experiences in the field. Better serving the
everyday role that International Geneva climate change, the decrease in biodiver- populations concerned will help strengthen
plays in promoting peace and prosperity sity, the imperative to achieve sustainable the multilateral system but also the confidence
across the globe. development objectives, or the implications of citizens in it.
of digital transformation and the future of
work. In the coming years, we believe that
Trade as response to global challenges
trade will play an increasing role in achieving
With regard to Switzerland’s multilat- sustainable development and poverty reduc-
eral commitment in the field of trade, tion. We also need to consider new initia-
we should also mention our collaboration tives on climate change, at the WTO and
with the International Trade Centre (ITC). beyond, to support the implementation of
1. Guy Parmelin, Vice President, Federal Council
This joint agency of the United Nations the Paris Agreement. of Switzerland
and the World Trade Organization created 2. View of Geneva with Jet d’Eau
in 1964 is entirely dedicated to support 3. Place des Nations, Geneva
FORUM ISSUE 4| 2020 | 17SPECIAL REPORT
Meeting current challenges:
The job at hand for the WTO
ALAN WM. WOLFF, Deputy Director-General, World Trade Organization (WTO)
© WTO
© WTO / Cuika Foto
B efore 2020, the closest our species
came to a truly shared experience
was the landing of the first human
the end of this year. Years of progress on
hunger and poverty reduction have already
been reversed, and the pandemic threatens
have been unwound. Global value chains
have shown resilience. While the pandemic
exposed some of the fragilities that come
being on the moon. That changed, to widen social and economic inequalities of with economic interdependence, it has also
and in a horribly negative way with every kind. revealed considerable strengths: global trade
COVID-19. In early April, more than Women in particular have borne in personal protective equipment more than
half of the global population was under the brunt of this crisis, both in the labour doubled in the 12 months leading up to May
some sort of lockdown. People every- market and at home. Education has been 2020, illustrating how global markets and
where feared for the health of their disrupted for billions of children. Small integrated supply chains are helping meet
loved ones and worried about their own businesses, which have less cushion urgent demand.
economic prospects. than their larger counterparts to absorb Keeping international markets open is
The pandemic has already claimed economic shocks, have also been hit espe- indispensable both for an effective pandemic
close to 1.5 million lives. Promising vaccine cially hard. Global merchandise trade is not response and, in the longer run, for a
trials give strong hope that there is light at expected to fully recover in the near term. strong, sustainable and job-rich recovery.
the end of the tunnel, but there has been a Many businesses in the services sector are In the future, more trade, not less, will
lot of loss, a lot of damage – and the storm struggling to survive. be necessary to bring medical supplies
has not yet passed. – including vaccines – to where they are
In economic terms, COVID-19 has needed, and to assure food security in the
Not all the news is negative, however.
provoked the worst drop in economic face of a changing climate.
output since the Second World War. The Medical treatment has gotten far better. Our goal must be, as the disaster
International Labour Organization estimates And as of this writing, global trade has fared risk reduction community’s now-widely-
that the equivalent of 495 million full time better than many expected. Extraordinary used slogan puts it, to build back better.
jobs – or about 17.3% of the global total – fiscal and monetary support have limited The theme repeatedly contained in
were lost between the end of 2019 and the the blow to aggregate demand. Several of the interventions by many of the G20
second quarter of 2020. Only about half of the export controls on food and medical Leaders during their 21-22 November
these losses are on track to be made up by supplies introduced early in the pandemic meeting was their determination not
18 | FORUM ISSUE 4 | 2020© WTO
to be caught unprepared for future rules must be designed to deliver on within the WTO to equip MSMEs to seize
pandemics, which scientists predict other clear environmental priorities, to global market opportunities.
will recur, and to meet the challenge promote the circular economy, to reduce None of this can be achieved
of climate change. The trading system plastics pollution and to consider how without forward-looking engagement
can do its part. To be effective, the best to approach fossil fuel subsidies. by WTO Members on systemic reform.
WTO, which has for the last 25 years The oceans should not only be freed The WTO must be a forum where trade
administered that system, needs to of plastics pollution, they should be safe agreements are negotiated and updated,
be updated and undergo fundamental for fish. An ambitious agreement to curb and where disputes can be adjudicated
reform. harmful fisheries subsidies, now under in a manner deemed legitimate by all
negotiation at the WTO, is needed. Members.
The future of multilateralism must
For the pandemic, the WTO needs to do
begin now.
more. Greater socioeconomic inclusion is also an
imperative.
Medicines and medical equipment should
be duty-free. Export restrictions placed on Here too there is a role for the WTO, even
personal protective equipment and other though domestic policies will be critical.
medical supplies should be subject to clear Micro, small and medium-sized enterprises
agreed international rules. Full transparency (MSMEs) that account for the vast majority
should be assured by the Members and the of jobs are disproportionately harmed by
WTO Secretariat. fragmentation in international economic 1. WTO Deputy Director-General Alan Wolff at the
To meet the challenge of climate rules, since they have less resources to navi- Eleventh Ministerial Conference (MC11) in December
2017 in Buenos Aires, Argentina.
change, environmental goods and gate overlapping regulations. They would
2. The Centre William Rappard, the home of the World
services should become duty-free, and also be disproportionately benefitted by Trade Organization.
the multilateral trading system should common multilateral rules. The work of 3. WTO members meeting in December 2019 at the
include new measures to deal with organizations like the International Trade General Council which meets regularly in Geneva to carry
carbon reduction. In addition, the Centre is a necessary complement to efforts out the functions of the WTO.
FORUM ISSUE 4| 2020 | 19SPECIAL REPORT
Small businesses key to economic
growth in Africa
MOONO MUPOTOLA, Director, Regional Development and Regional Integration, African Development Bank
T he COVID-19 pandemic has had
an adverse economic impact on
Africa, with sub-Saharan Africa
experiencing its first recession in 25
years. The continent’s gross domestic
product (GDP) is expected to decline
from about 3% in 2019 to -2% to -5%
in 2020, with the region’s major sources
of revenue declining. To give a few
concrete examples, commodity exports
and remittances declined by 17% and
over 23% respectively, and the tourism
sector has lost up to $120 billion
in revenue.
The partial or complete lockdowns
in most African countries imposed a huge
economic shock on the private sector, espe-
cially for those on the fringes of the formal
economy. Micro, small and medium-sized
enterprises (MSMEs), took a heavy toll. If support these small businesses to trade. Bank is enabling MSMEs to leverage
not effectively addressed, this does not bode Enhanced Bank support to MSMEs is both the AfCFTA and Africa’s fastest
well for the continent’s recovery prospects, particularly important now that the African growing consumer markets, as well
as MSMEs are the engine of Africa’s job Continental Free Trade Area (AfCFTA) is as integrate into regional and global
growth. Although many African countries in force and will be creating tremendous value chains.
borrowed from the African Development economic opportunities. Creating a larger
Bank (AfDB) for economic stimulus pack- market that goes beyond national borders
Financing small businesses is a priority
ages to cushion the effects of the pandemic, will increase product demand, ensuring
the support for MSMEs has been limited. full capacity utilization of these MSMEs, The African Development Bank has a
The current crisis, also required the Bank and ultimately result in expanded MSME long and successful history in providing
to reconfigure its MSME support systems to investments in the continent. support to the private sector, and MSMEs
address the pandemic’s economic conse- More importantly, MSMEs as part in particular. The Bank’s interventions foster
quences. This included, for the first time, of a supply chain are better placed to a suitable business and operational envi-
leveraging the Bank’s Regional Operations benefit from partnerships with potential ronment; promote further entrepreneurial
Envelope to bolster national budgets and foreign investors, seeking to expand or development through technical assistance
supplement policy-based allocations from the launch their business on the continent. and business development services; and
Bank. These operations all had very strong MSMEs would benefit from improved provide trade finance through innovative
MSME - support components to mitigate management practices, technology financing instruments. All of these make
the impact on these enterprises. transfers, capital infusion and greater specific provision for marginalized groups,
With MSMEs constituting 80% of market penetration locally, regionally such as for women and youth.
Africa’s enterprises, multilateral financing and globally. Through its support inter- The Bank’s trade finance programme, for
institutions, such as the AfDB, need to ventions, which address the above, the instance, has made great strides since 2013
20 | FORUM ISSUE 4 | 2020SPECIAL REPORT
and so far supported more than $7 billion of markets, as well as strengthening skills and institution, and in pursuit of its MSME
trade. It has facilitated more than 1,900 trade business linkages for MSMEs. development agenda, the Bank is working
transactions for a cumulative trade value of Additionally, the Bank administers on an ecosystem that brings together the
around $4.9 billion, involving 113 financial the Fund for Private Sector Assistance different fragments of support under various
institutions in at least 32 African countries. promoting innovative projects that support programmes to strengthen the coordination
Using a transaction size of $1 million or small businesses. In Ghana, for example, and synergies within the Bank.
less as a proxy for MSME transactions, 60% where over 85% of enterprises are MSMEs At the same time, the Bank is consid-
of all supported transactions are attribut- contributing about 70% of the country’s ering its revised Private Sector Devel-
able to MSMEs. In addition, the programme GDP, the Ghana Business Linkages Project opment strategy for 2021-25, which
supported intra-African trade accounting for focused specifically on skills development as proposes a value chain-based approach
approximately $1 billion of total trade with well as improving production technologies for developing the private sector,
sectors such as agriculture, forestry and and linkages. By the project’s end in 2018, including MSMEs. These strategic
fishery as well as manufacturing, respec- over 1,700 MSMEs were registered on the documents, which take into full account
tively accounting for 22% and 25% of total African Partner Pool Platform – an innova- the pandemic’s impact, will also look at
value of trade supported. tive database of credible local suppliers; future challenges.
Under the Africa Trade Fund, which with 15 large companies already using the
focuses on trade-related technical assistance, tool to source goods and services; over 104
nearly two-thirds of the entire Fund opera- trained MSMEs; and MSMEs winning 67
tions of around $7 million, have been dedi- tenders in the country.
cated to MSMEs in more than 10 countries. © All photos: José Carlos Alexandre for the AfDB
The Fund’s support also extends to the
Looking forward 1. Women cashew processors outside of Banjul, the Gambia
informal sector, including honey value-chain
2. Beekeeper harvesting honey in rural Zambia
development projects in Guinea, Rwanda The Bank has a huge role to play in Africa’s
3. Moving sacks for transport at Bujumbura’s loading port
and Zambia, and meat in Rwanda. These trade and in the development of MSMEs. in Burundi
projects focus on product development and As the continent’s premier development 4. Workers packing pineapples in Sierra Leone
FORUM ISSUE 4| 2020 | 21SPECIAL REPORT
Can multilateralism evolve?
HOMI KHARAS, Senior Fellow, and SEBASTIAN STRAUSS, Senior Research Analyst and Coordinator for Strategic Engagements, Global Economy
and Development, Brookings Institution
© Shutterstock
O ver the last 75 years, multilateralism
has been a powerful driver and pillar
of global integration, peace, and
diversity and experimentation in the process.
As Dani Rodrik has argued, there is a trilemma
preventing the simultaneous achievement
and reap the benefits of scale, at the expense
of robustness and security.
In return, politicians promised that the
prosperity. However, recent disaffection of deep globalization, national sovereignty, rising tide would lift all boats. But while
with globalization and with existing forms and democracy. Far too often, small and global GDP has risen quite rapidly over
of global governance threatens the founda- medium-sized nations — particularly in the the past decades—with China and, to a
tions of the rules-based multilateral order. Global South — have been forced to choose lesser degree India, achieving particularly
Growing political discontent with between gaining access to global markets and rapid growth—globalization has resulted
multilateralism, most notably in the United keeping policy space for the pursuit of their in widening inequalities within most coun-
States, is associated with the failure of the national development strategies. tries and exposed nations to unquantifiable
post-Bretton Woods system to stem the tide levels of systemic fragility. Not surprisingly,
of slow growth, rising inequality, migration, COVID-19 and the resulting economic
Global challenges predate COVID-19
social fragmentation, and job insecurity downturn are only aggravating existing
associated with skill-biased technological The COVID-19 catastrophe has piled on by social cleavages within and across countries.
change, offshoring and financialization. exposing key vulnerabilities in today’s hyper- But while COVID-19 has poured jet
In addition to its failure to deliver globalized mode of production as well as fuel on deep and hard-set fault lines, even
shared prosperity, the ever-widening scope important gaps in the global governance archi- before its emergence the world was already
of globalization also undermined democ- tecture. The current configuration of economic fast approaching irreversible thresholds and
racy by reducing nations’ sovereign policy globalization was designed to maximize short- tipping points on several global challenges,
autonomy, inhibiting often desirable policy term efficiency, minimize transaction costs, most notably in the realms of climate change
22 | FORUM ISSUE 4 | 2020© Florence Gachoud
and artificial intelligence. The window of Disillusionment with multilateralism has mechanisms. While inclusion and equity are
opportunity to address some of these prob- led to consideration of various alternatives, valuable features in and of themselves, they
lems is closing; the COVID-19 catastrophe such as the replacement of multilat- also serve the purpose of making systems
only adds greater urgency to the need for eral agreements by bilateral deals or of more legitimate and therefore more sustain-
a multilateralism that can deal with the multilateral rules by rules for likeminded able.
immense dangers that lie ahead. or geographically proximate countries. Now is the time to think boldly about
Alas, none of these alternatives can substi- a global governance that reflects the lessons
tute for true multilateralism, since a world learned from past decades as well as the
Cooperation is a necessary means rather
facing inherently global challenges requires lessons of the current crisis. Multilateralism
than an end
globally concerted action. needs to address its discontents and evolve
The greatest obstacles to achieving greater to be fit for purpose in an era of renewed
cooperation stem from a profound loss of great power competition and a decoupling of
Time for inclusive and sustainable
direction about why to cooperate in the economic prosperity from social prosperity.
multilateralism
first place. All too often treated as an end It is all the more urgent to look ahead as
in itself, multilateralism must be reimag- To safeguard its benefits and ensure it works the threats from climate change are growing
ined as a means to empowering people and in the service of all nations and people, a and as new technologies, while offering
enhancing social prosperity. While in practice multilateral compromise fit for the 21st immense promise, also carry grave dangers.
this may entail a “thinner” globalization, a century ought to prioritize the wellbeing of These realities necessitate ambitious inter-
scaled back but inclusive and sustainable the worst-off, build much more robustness national cooperation to address inherently
multilateralism is preferable to no multilat- into the global system, and accommodate global problems. The challenge is to find
eralism at all. A case must be made for a legitimate demands for policy autonomy, a set of general principles to guide and
truly global and inclusive multilateralism while ensuring the prevention of beggar- constrain global rule-making that all nations
being not only worth having, but also of the thy-neighbor policies, the provision of global can agree on. Either way, inaction is not an
utmost necessity. public goods and the management of the option — nature abhors a vacuum.
For the past two decades, calls have global commons.
grown louder to reform the current multi- A negotiated understanding of where This article is adapted from a T20 policy brief titled
“The Future of Multilateralism: Responsible Glo-
lateral system to reflect changes in the to position international institutions within
balization that Empowers Citizens and Leaves No
economic, demographic and geopolitical the globalization trilemma should shape One Behind”, co-authored with Dennis Snower.
weight of advanced and developing econo- the parameters of this new compromise.
mies. Political rigidities in multilateral Legitimizing global governance entails
organizations such as the International improving the representativeness of
Monetary Fund, the World Bank, the UN, and global rulemaking processes, enhancing
the World Trade Organization have prevented the inclusion of marginalized voices and
adequate reform from being achieved. bolstering responsiveness and accountability
FORUM ISSUE 4| 2020 | 23DELIVERING AS ONE
Making headway
GERALD DALY, Resident Coordinator, United Nations in Bhutan
© UN
United Nations is ‘Delivering as One’ to promote sustainable development in Bhutan
A s this unpredictable year comes to an
end, we are still braving a pandemic
that has been incredibly challenging
Building back better
In 2008, Bhutan adopted the ‘Delivering
to craft this Roadmap, which includes the
economic, social, environmental, and
governance aspects of the Sustainable
for us all. The most vulnerable sections of as One’ approach to improve collective Development Goals.
society, the poor, women and children in performance, efficiency, accountability and Moreover, through the UN Framework for
particular, have been the most affected and results. This new approach strengthened the Socio-Economic Response to COVID-19,
the crisis has created an economic impact the UN’s role at the heart of the multilat- the UN Country Team has been actively
that will only increase income inequalities eral system. Since then, the UN in Bhutan supporting the government. As trade,
around the world. has delivered collaborative results through private-sector development and supporting
Given the scale of this global COVID-19 specialized resident UN agencies and in micro, small and medium-sized enterprises
challenge, our world may need to go beyond close coordination with other development are critical factors in this response, private-
simple categories of either optimism or pessi- partners in the country. sector empowerment is at the core of our
mism. United Nations Bhutan is responding The Royal Government of Bhutan has support to Bhutan.
to the immediate needs of the people; embarked on developing the Economic
the needs of the most vulnerable, while Roadmap for the 21st Century to guide its
ITC strengthens business
strengthening economic resilience and development plans and programmes for a
building long-term human capital so that we “High Income Gross National Happiness Exports in Bhutan are highly concentrated,
find new ways to ‘build back better’. Society by 2030.” The Government invited with about 80% consisting of only 10
the Development Partners Group, which I commodities, destined for the Indian market.
lead together with the UN Country Team, The country also faces distinct constraints
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