Trade for growth
Today’s post is from Ian Wood, the UK’s Deputy Permanent Representative to the OECD
The OECD’s latest merchandise trade statistics provide further proof of tough times in the world economy, showing falls of 0.2% in imports to, and of 1.2% in exports from, G7 and BRIC countries in the fourth quarter of 2011.
But the evidence shows that boosting trade is one of the surest drivers of sustainable growth around. Trade allows firms to expand and – through competition – accelerate innovation and productivity growth.
That’s why the UK published its Trade and Investment White Paper in February 2011. One year on, as Trade Minister Stephen Green has underlined, we’re working hard to realise its goals, including through the OECD and its committees.
Trade facilitation – rules to simplify import and export procedures – is one area where we should seek to make early progress. WTO Director-General Pascal Lamy reminded OECD Council that some 50 per cent of potential gains from the Doha Round were to be found in this area.
We are also optimistic about the work-streams launched following the revision of the Government Procurement Agreement in December of last year at the WTO in Geneva – governments are after all among the biggest consumers of products and services.
Free Trade Areas provide another opportunity, with the EU-South Korea deal alone set to increase UK GDP by £500m, and other agreements are in the pipeline. The OECD is doing valuable work in exploring the potential to take provisions from such regional deals and make them global.
Services is another key area. Within the EU we are pushing hard for a genuine digital and services single market. We look forward to the OECD’s Internet Economy Outlook and the Economic Survey of the EU in the next few months, as well as the upcoming Services Trade Restrictiveness Index, which will all help reinforce the case for rapid progress.
We want trade to take place in fair conditions. The OECD’s Investment Round Table and Working Group on Bribery are both important in this regard. The UK is committed to ensuring that British firms abide by the rules of our new, state of the art bribery legislation. We expect others to commit to equally vigorous enforcement.
At the same time, we want to make sure regulation is not burdensome, and are working hard with the OECD’s Regulatory Policy Committee on this. In all of these areas, we look forward to future OECD work, and the contribution it can make to strengthening the case for trade.
Trade and investment should work for developing countries as well as for developed ones. The UK is committed to the African Free Trade initiative, and we look forward to seeing a Continental Free Trade Agreement by 2017. And drawing on the lessons of the OECD’s excellent Aid for Trade work, we invest around £1bn a year in helping developing countries help themselves, including by providing assistance in preparations for key trade negotiations.
So, while figures are pointing down for this quarter, there’s plenty of potential to turn this around. We’re proud to be working with the OECD to achieve this.
International trade and balance of payment statistics from the OECD