World Trade Organization
Fight Poverty: Keep On Trading
We may be in the midst of global recession, but if countries react by curbing their trade with each other, it will only hurt the poorest among them.
That's the gist of the message delivered by Pascal Lamy, director-general of the World Trade Organization, in a recent Wall Street Journal opinion piece.
History tells us that no poor country has ever become wealthy without trade, Moreover, many developing country success stories — Singapore, South Korea, Chile, China and Malaysia, to name only a few — have, in recent decades, seen their national incomes grow by a percentage point or more per year as a result of open trade policies than would [not] have been the case had they remained closed. The extra funds generated during this period have enabled them to respond to the crisis with stimulus packages that have prevented the crisis from turning into a protracted recession with its inevitable human costs.
In 2005, the WTO adopted an initiative called "Aid for Trade" to support and encourage trade. The initiative does two things: It funds infrastructure projects like roads and electrical grids, and trains exporters on how to comply with the safety and quality standards of other countries.
This week the WTO is convening in Geneva with select development banks and aid organizations for Aid for Trade's annual review. In his Wall Street Journal opinion piece Lamy tells us that, "we have to make sure [Aid for Trade] is more and more effective in helping developing countries overcome their economic difficulties. It's what people expect from us today."
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