Leaders On Global Trade Discuss Leadership And Current Trade Challenges

A recent event jointly organised by the Graduate Institute Centre for Trade and Economic Integration and the United Kingdom Department for International Trade and its Mission to the WTO brought together several leaders on global trade to discuss the current challenges in trade and how best to address them.

The leaders in the 21 June event included Liam Fox, United Kingdom Secretary of State for International Trade and President of the Board of Trade, World Intellectual Property Organization Director General Francis Gurry, and International Trade Centre Executive Director Arancha Gonzalez.

It was a vibrant atmosphere at the Graduate Institute, where the event was moderated by Theresa Carpenter, executive director at the institute’s Centre for Trade and Economic Integration. Speakers discussed what leadership means in the global trading system, the current challenges in global trade and how best to address them.

Fox, in his demonstration of the role that the United Kingdom has played and continues to play as one of the “foremost champions” of the multilateral trading system, highlighted the efforts of the UK in making sure that the multilateral trading system is beneficial to all.

“We see superior multilateral trade in a rules-based international architecture as overwhelmingly in United Kingdom’s national interest so we will use all of our economic and diplomatic influence to remove barriers, open up new markets and spread prosperity to every part of the globe,” said Fox.

“We believe that the system of freedom of trade has enabled us in the past generation to take a billion people out of abject poverty, one of the greatest achievements in human history, and those of us who have benefitted from freedom of the trading system have a moral duty to ensure that it’s available to future generations,” he added. “It is not good enough for wealthy countries to say that we have done well from the system and pull up the drawbridge behind us.”

It is not good enough for wealthy countries to say that we have done well from the system and pull up the drawbridge behind us. – Liam Fox

Pointing out the implications of a closed trading system, Fox explained, “We believe that trade is the means by which we spread prosperity, that prosperity underpins social cohesion, that social cohesion itself underpins political stability, and that political stability is the essential building block of our collective security. Thus, you cannot deny the prosperity in a free trading system and then be surprised at the consequences.”

“If we deny people the ability to access the prosperity that many of us already take for granted, do not be surprised if you get greater mass migration or greater radicalisation, there’s a price to be paid for a closed trading system,” he said.

Finally, Fox demonstrated how the UK has focused on ensuring that developing countries benefit from trade. He highlighted different programmes that the UK has launched to help unlock trade opportunities globally and UK’s commitment to Aid for Trade as well as the wider action that the UK is taking to ensure that developing countries can reduce poverty through trading opportunities.

The IP Point of View

Discussing the link between intellectual property and trade, Francis Gurry highlighted the development of intellectual property in the economic system in the last 20 years.

According to Gurry, intellectual property has been on a journey from the periphery of the economic system to the centre. If we see the economic strategy of all of the leading economies like the United States, China, Japan, Germany, United Kingdom, France and many middle-income countries, we see science, technology and innovation at the centre, he said.

The connection between these developments and intellectual property, said Gurry, is that the competitive advantage conferred by innovation is protected by intellectual property.

Gurry also pointed out the efforts of countries to recapture manufacturing. He demonstrated that this will have an impact on global value chains. For instance, Adidas, which has been manufacturing shoes in various markets around the world, can now make these shoes through robotics and advanced manufacturing techniques in Germany, he said.

Carpenter, the moderator, asked Gurry the extent to which these robotics manufacturing techniques would bring back jobs, Gurry said he is a bit pessimistic about the “bringing back job” aspect of robotic manufacturing. It is not recapturing old manufacturing practices but recapturing manufacturing through new technologies and techniques, he added.

When Arancha Gonzalez was asked to comment on the same question, she said she sees technology as a means through which value can be added. For instance, she mentioned that Tanzania and Cote d’Ivoire are looking for ways to have more local value added when it comes to agriculture, for example, the protection of intellectual property of certain agricultural products.

On leadership and what it means for the global trading system today, Gonzalez highlighted that leadership in the short term is needed to make sure that the global trading system does not move backwards, that is, from a system that is based on checks and balances and full sovereignty to one on unilateralism.

In the medium term, the system needs reforming for adaptation to a more multi-polar technological world and in the long term, leadership is needed for more inclusiveness of women and young people in international trade and entrepreneurship, she added.

Damilola Adepeju is a student of the Graduate Institute of International and Development Studies in Geneva. She is in her final semester of study for a Master in International Relations/Political Science.