Is the world integrating or disintegrating?
The Sixty-Fourth Session of the UNCTAD Trade and Development Board will be held from 11 to 22 September 2017 in Geneva. A high-level dialogue will provide an opportunity to assess the contribution of regional integration to economic growth and fostering stronger and more integrated economies across the globe. Below are some of the key items on the agenda.
High-level dialogue: Is the world integrating or disintegrating?
The Nairobi Maafikiano highlights the importance of regional integration to the promotion of inclusive growth and sustainable development via, inter alia, strengthening regional economic cooperation among developing and developed countries. Regional integration can be an important catalyst to reduce trade barriers, implement policy reforms, decrease trade costs and increase developing country participation in regional and global value chains.
The Trade and Development Board will examine regional integration and identify specific policy mechanisms through which regional integration can be strengthened to increase economic growth, maximize development gains and serve as a positive force in the implementation of the Sustainable Development Goals.
In the wake of two landmark anniversaries for regional integration, namely the fiftieth anniversary of the Association of Southeast Asian Nations and the sixtieth anniversary of the European Union, the meeting will aim at providing an opportunity to assess the contribution of regional integration to economic growth and to building productive capacities. The high-level segment will facilitate the exchange of experience in the field of regional economic integration through the presentation of best practices in regional trade agreements from various geographical regions. The aim will be to arrive at practical policy recommendations on how regional trade agreements can promote inclusive and sustainable development and to design measures that can meet emerging challenges while supporting structural economic transformation.
Interdependence: Inclusive growth – towards a global agenda
Deliberations by the Trade and Development Board will provide an opportunity to review the evolution of the world economy in 2016 and 2017. The review will analyse the factors that are making this recovery the longest and slowest on record, in particular continued slow growth in advanced economies, debt overhang and financial fragility.
The debate will consider recent trends in financial markets and flows and address the vulnerabilities faced by developing countries. It will also address rising inequality as one of the fundamental constrains on the faster growth of the global economy. In particular, the session will examine how inequality and financial instability jointly pose structural limits to inclusive growth, and provide a proposed global agenda to address these constraints.
Development strategies in a globalized world
Sustainable Development Goals 1, 8 and 10 define the inclusive growth agenda within the 2030 Agenda for Sustainable Development. This has begun to receive prominence as part of a perceived need to strengthen the globalization narrative to address the problem of growing inequality. However, the analytical and policy content remains vague, often reduced to addressing the problem of those “left behind” during periods of growth and largely disconnected from the unequalizing systemic forces intrinsic to finance-led (hyper)globalization and its related policy agenda.
The debate will introduce the issues around globalization, inequality and lack of inclusive growth linked to the Sustainable Development Goals. In particular, it will address the following issues: the fourth industrial revolution and inclusive growth; macroeconomic aspects of gender issues and inclusive growth; and globalization and the rise of rentier capitalism. At the end of the debate, a global policy approach to address these issues will be discussed.
As background documentation for the Board’s deliberations on this item, the secretariat will make available the Trade and Development Report, 2017: Beyond Austerity – Towards a Global New Deal.
Contribution of UNCTAD to the implementation of the Programme of Action for the Least Developed Countries
The Board will consider the sixth progress report of the secretariat on UNCTAD-wide implementation activities under the Programme of Action for the Least Developed Countries for the Decade 2011-2020. The report provides a brief assessment of recent economic performance of least developed countries together with the UNCTAD contribution to the implementation of the Programme of Action. It also includes policy conclusions, lessons learned and, to the extent possible, best practices drawn from implementation of the Programme of Action. The report shows that, while the research and policy analysis work of the secretariat contributed to policy dialogue and building consensus at the national, regional and global levels on issues of trade and development interest to least developed countries, its technical cooperation and capacity-building activities have also greatly assisted in building the institutional and human resources capacities of least developed countries.
Building productive capacities in the least developed countries and graduated least developed countries: Lessons learned
There will be a high-level panel discussion on accelerating progress in building productive capacities in least developed countries and other vulnerable economies. The high level panel will examine the state of productive capacity development in least developed countries and other vulnerable developing countries with a view to identifying action-oriented policy recommendations.
Economic development in Africa: Tourism for transformative and inclusive growth
The Board will consider the Economic Development in Africa Report 2017: Tourism for Transformative and Inclusive Growth, which examines the role that tourism can play in Africa’s development process. The report aims at identifying key barriers and impediments to unlocking the potential of tourism in Africa to help structurally transform the continent’s economy and provides policy recommendations on how these barriers and impediments could be addressed. It argues that tourism can be an engine for inclusive growth and economic development and that it can complement development strategies aimed at fostering economic diversification and structural transformation within an appropriate policy context.
The high-level segment will focus on exploiting the potential of tourism for transformative growth in Africa. A panel session will provide an opportunity to discuss how to boost tourism in Africa in light of new insights from recent research and best practices across the sector in Africa and elsewhere, particularly how to strengthen linkages of tourism and reduce leakages out of the domestic economy and how to tap the potential of intra-African tourism, given that it is increasing and offers comparatively stronger linkages than tourism from outside Africa.
Evolution of the international trading system and its trends from a development perspective
Paragraph 38 (m) of the Nairobi Maafikiano, the outcome document of the fourteenth session of the United Nations Conference on Trade and Development, states that UNCTAD should “continue to monitor and assess the evolution of the international trading system and its trends from a development perspective, with particular attention to its potential contribution to the Sustainable Development Goals”. In response to this mandate, under the agenda item the Trade and Development Board will discuss recent trends in international trade in goods and services and trade policy.
The Board will deliberate on trends in trade flows, both in goods and services, and various factors affecting patterns in international trade. The discussion will also cover emerging trends and issues in multilateral and regional trading systems and their interlinkages with national policies.
Investment for development: Investment and the digital economy
A key challenge in today’s global economy is digital development. The digital economy offers many new opportunities for inclusive and sustainable development but also presents serious policy challenges. Policymakers are increasingly confronted with the need to narrow the digital divide and to meet the formidable investment challenges of the 2030 Agenda on Sustainable Development.
The digital economy has important implications for investment. At the same time, investment is crucial for digital development. First, the digital economy has the potential to transform international production and therefore has implications for investment policymaking. Second, digital development in all countries, particularly to facilitate the participation of developing countries in the global digital economy, calls for the development of digital domestic capacity. Targeted investment policies should seek to build connectivity infrastructure, promote digital firms and support digitalization of the wider economy.
The session will present the analysis, findings and proposals of the World Investment Report 2017: Investment and the Digital Economy, which examines this topic in depth. In particular, the report investigates internationalization patterns of digital multinational enterprises, as well as the effect of digitalization on global companies across all industries. It provides insights for policymakers on how the digital economy affects investment policies and how investment policy can support digital development, notably with a view to advancing the Sustainable Development Goals. The report presents an investment policy framework for the digital economy. After a presentation, eminent panellists will present their own perspectives on the topic, followed by an open floor discussion. In addition, the session will provide an opportunity for a briefing by the secretariat on the latest foreign direct investment trends and policy developments.
Establishing development linkages in the extractive sector: Lessons from the field
In many commodity-dependent developing countries, the exploitation of extractive resources has brought in large revenues and created important opportunities for economic growth and sustainable development. According to the UNCTAD State of Commodity Dependence 2016, extractive exports accounted for 93 per cent of total merchandise exports in Chad, 87 per cent in the Congo and 95 per cent in Equatorial Guinea for 2014/15.
However, most commodity-dependent developing countries export their extractive resources as raw materials with little value added and therefore have not been able to transform their extractive sector wealth into economic or sustainable development gains that benefit the rest of the economy. The high dependence on extractive resources makes these countries vulnerable to market price fluctuations. Underdeveloped linkages with the broader economy, as a result of the relative isolation from the rest of the economy and the capital-intensive nature of the extractive sector, leads to the sector’s limited contribution to job creation and economic diversification.
Countries can respond to this challenge by moving away from exports of unrefined or semi-refined commodities to the creation of downstream industries that would spur economic development and diversification. This can be achieved by strengthening linkages of the extractive sector with the broader economy.
The session will discuss ways in which these countries can leverage linkages (production (backward and forward), horizontal, consumption, fiscal and spatial linkages) to transform the extractive sector and make it to contribute to a more inclusive and diversified economy. Discussions will benefit from field experience gained in the implementation of the UNCTAD project on strengthening the capacity of the Economic Community for Central African States to enhance development linkages from the mineral resources sector with the rest of the economy.