Session summary
Closing address: THINKING AHEAD AND PLANNING FOR TOMORROW
11 SEPTEMBER 2010, 17:00 – 18:00
SPEAKERS
- Dr. Mari E. Pangestu, Minister of Trade, Indonesia
- Mr. Sirisamphanh Vorachith, Deputy Permanent Secretary, Minister of Industry and Commerce, Laos
- Ms. Marlene Malahoo Forte, Minister of State, Ministry of Foreign Affairs & Foreign Trade, Jamaica
- Mr. Eric Zhang, Vice President, ZTE Corporation, China
- Dr. Alexander Barkawi, former Managing Director, SAM Indexes and Dow Jones Sustainability Indexes, Switzerland
MODERATOR
CLOSING STATEMENT
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SUMMARY
The Forum’s closing discussion session, moderated by Professor Ghemawat, was forward looking and concluded that the outlook for the future was bright, with a great deal of optimism regarding the contribution of technology, combined with concerns about the pressure on resources.
Mr. Zhang discussed the social and economic impacts of telecommunications, which helped create more favourable trading environments and brought investment to developing countries, accelerating the development of their own industries.
Information and Communication Technology (ICTs) could build a solid base for international trading and create employment opportunities as well as speeding the transmission of knowledge.
Dr. Barkawi spoke of the need to move from a short-term to a long-term perspective and he lamented the short-termism of many financial and business institutions. He said there were three trends giving rise to concern for the future, which were the constraints on energy supplies and volatility in prices, likewise with water resources and other commodities in general.
These were all input factors affecting expanding economies and would present growing challenges in the coming years to all the main sectors: agriculture, industry and services.
However, he said, there were opportunities related to the introduction of clean technologies, for example, reduction in wastage of water resources. He said financial markets should divert capital flows into new technologies, and education on these issues should be broadened at university level, and policy-makers should consider the desirability of using instruments such as tax and procurement policies.
Senator Malahoo Forte said that the global recovery was under way, and an expansion in trade in goods and services was to be expected. She said there was likely to be a proliferation of regional trade agreements and further growth in the off shoring of services. This in turn required strong growth in ICTs, with appropriate institutional infrastructure.
She said the emergence of new economic powers required a change in the direction of trade, and developing countries need to position themselves to take advantage of the changed landscape. They needed to put more emphasis on value-added products.
The crisis had also presented new challenges to SMEs’ ability to be resilient. They had difficulty accessing the necessary ICTs, which meant assistance from development partners was needed. Governments should focus on policies and strategies to increase competitiveness of local firms, providing incentives for SMEs to address the needs of modern consumers in terms of real time information and speedy delivery. The challenges are many, but fortunately we have technology on our side, she said.
Mr. Sirisamphanh said that it was inspiring to observe that emerging economies had better overcome the impact of the world economic crisis. He said Laos had experienced satisfactorily high rates of growth and success factors included a shift to a market-oriented economy, openness to the world and integration in a regional trading system.
By adopting an outward orientation, the country had been able to attract foreign investment and increase exports to both regional and distant markets.
Looking to the future, he said there had been a tendency to think that trading partners should be developed countries and overlook regional and emerging markets. Laos realised it had to take advantage of its geographical proximity to emerging markets – there was no reason to remain poor while neighbours were prospering.
By trading with other countries in the sub-region, Laos could transform its state of land-lockedness, which had been a handicap for exports for many years, to one of being a land-linked country.
The debate that followed the presentations returned to the issue of voluntary standards, which was covered in an earlier session, and whether they could constitute non-tariff barriers to trade. Senator Malahoo Forte said that these standards could exclude entry to markets, and this had been witnessed in the Caribbean region.
One contributor commented that standards might be voluntary for those who subscribed to them, but were barriers for those who did not. Mr. Rob Cameron of The Fairtrade Labelling Organizations International, said fairtrade standards were intended to be an aid to trade and not a barrier.
Senator Malahoo Forte also commented that the benefits of trade liberalization had not materialized for many developing countries because of their own domestic supply-side constraints, including infrastructure, finance, knowledge and competitiveness. These needed to be addressed under the Aid-for-Trade initiative.
CLOSING STATEMENT
ITC Executive Director Patricia R. Francis, in her closing statement, said the mood of the meeting was optimistic: “It helps that we are seeing positive signs of recovery. It also helps that you are all adopting the outstanding Chinese characteristic of pragmatism, which helps us to see and realize the opportunities in this crisis,” she said.
She described a number of conclusions reached during the meeting:
- That the world was still perhaps not as globalized as some people thought, and this meant there were opportunities for business to exploit;
- That the large emerging economies will need to balance growth of domestic demand with boosting exports;
- That companies and countries should focus on increasing the value rather than the volume of exports;
- That regulatory frameworks should support this through fiscal measures and targeted subsidies, leading to enhancement of innovation;
- That regional integration was vital, particularly in Africa and small island regions such as the Caribbean and the Pacific;
- That South-South trade between developing countries and emerging markets will become one of the most important drivers for trade and growth;
- That companies and countries need to think long-term and incentives should be devised to encourage this;
- That the trade in services will expand, and tourism represents an easy entry for many developed countries;
- That urbanization could contribute to poverty reduction if linked to export strategies;
- That all actions had to be undertaken in a context of low carbon growth.
Strategic responses would have to include:
- Trade support institutions becoming more dynamic and responsive;
- Entrepreneurs integrating themselves into global supply chains;
- Policy-makers addressing standards and non-tariff measures at the multilateral level, preventing them from becoming barriers;
- The financial service industry providing greater flexibility;
- The private sector speaking with one voice to be effective in public-private partnerships.
Ms. Francis announced that while the Forum was going on, agreement had been reached on a four party collaboration between ITC, the Ministry of Commerce of the People’s Republic of China (MOFCOM), the China Council for the Promotion of International Trade (CCPIT), and the Chongqing Foreign Trade and Economic Relations Commission (COFTEC).
A comprehensive 10-point workplan would be implemented in the coming years covering areas including market analysis, sector development programmes and business match-making.
A second important initiative had resulted from a roundtable meeting for senior executives on gender-specific procurement. This was the establishment of the Chongqing Platform for Action on Sourcing from Women Vendors. This aimed to facilitate the exchange of ideas and best practice on sourcing from women vendors and increase women’s share of corporate, government and institutional procurement.
After the announcements, Mr Li Jian Chun, the Director of COFTEC, said of the four party collaboration: “This must be a prototype and success story of Chongqing in export development.” His deputy, Professor Li Shirong, said of the Platform of Action: “Knowing each other is the beginning; coming together is progress; working together is success.”
Ms. Francis said the agreements represented new opportunities for collaboration between ITC and China, and she looked forward to working with the Chongqing authorities.