Representatives of non-governmental organizations told UNCTAD that stopping the anti-globalization tide required a new development narrative, and franker conversations about the risks of open borders
Representatives of civil society organizations meeting with UNCTAD’s top management in Geneva on 24 May called on the organization to take the lead in writing a new trade and development narrative that could counter the anti-globalization tide undermining the collective goodwill needed to battle poverty and inequality.
Multilateral cooperation has fallen out of fashion amid growing concerns that globalization has done more harm than good.
UNCTAD Secretary-General Mukhisa Kituyi said that civil society was “painfully” aware of the headwinds that multilateralism faced, and the dangers posed by a declining spirit of international solidarity.
“The notion of ‘me against the world’ narrows the boundaries of moral compass, of social responsibility, and of collective action,” Dr. Kituyi said. “This a collective challenge to those of us who believe that common problems require common solutions.”
Multilateralism, he said, was the result of centuries of human struggle to find lasting solutions to timeless problems.
“We have to find in our discourse…a way of resuscitating the optimism that we had about multilateralism,” Dr. Kituyi said.
Civil society representatives said that simply preaching the benefits of multilateralism, or promoting trade for trade’s sake, would likely fall on deaf ears.
“Mistrust needs more than lectures. It needs a counter narrative,” said Rashid Kaukab, a director of the non-governmental organization Consumer Unity & Trust Society (CUTS) International.
“A narrative that admits that free trade produces both winners and losers, that technological changes are bringing both opportunities and marginalization, and that the final outcome is not preordained but will depend on policies.”
Mr. Kaukab said that UNCTAD’s expertise on issues related to trade and development and its inclusive nature made the organization the best candidate for the task at hand.
See the crisis as an opportunity
“Every crisis comes with a number of opportunities,” said Stefano Prato, managing director of the Society for International Development.
The current crisis facing multilateralism, he said, provided the opportunity to rethink the trade regime that has come out of the rules approved in the World Trade Organization (WTO).
“The WTO trade regime has in many ways been the main driver of a form of globalization that hasn't been friendly to development,” he said.
Mr. Prato, who also coordinates a group of civil society organizations and networks engaged in the international community’s Financing for Development process, said that this year’s modest economic upswing shows that the system is failing people because the growth has come “with an increase in poverty, with an increase in emissions, and with an increase in the profile of vulnerabilities.”
“So we live in a situation in which the global economy fails us when it is in recession but equally fails us when it grows again,” he said, adding that reversing this trend required flipping the way we think about trade and development.
“We've been operating over the last decades in a trade-and-maybe-development context, and I think we need to start reversing the equation and discuss development and maybe trade,” he said.
According to him, this meant shifting the focus from growing exports and imports to building domestic markets in developing countries, which would better help them diversify their economies away from low-skill, low-wage sectors.
“Trade hasn't been friendly to that. It has been actually pushing for the opposite, for very strong specialization,” he said.
Change the rules of the game
Richard Kozul-Wright, director of UNCTAD’s Division on Globalization and Development Strategies, echoed civil society’s call to rethink the rules of the game.
“It's our job as an institution not simply to promote a rules-based system but to promote a rules-based system that works for development,” Mr. Kozul-Wright said.
“That's the name of the game. That's what we were set up to do,” he said, adding that UNCTAD was born in 1964 out of growing frustrations in newly-independent countries in Africa, Asia and Latin America with the rules-based system in place, which they felt wasn’t fit for helping them catch up and compete with richer nations.
“Trade only acts as an engine of growth if we live in a full-employment world, if we have long-term capital flows, if we have workers’ rights, and if developing countries are allowed to diversify and industrialize their economies.”
“So we need to think very hard about what kind of rules we need to allow more developing countries to do what China has done…because they want to do what China did. They want to take millions of people out of poverty, diversify their economies into high higher-value, more productive sectors,” he said.
“We don't have a set of rules that allow us to do that.”
Stop the China bashing
Deborah James, director of international programs for the Washington D.C.-based think tank the Center for Economic and Policy Research, agreed that changing the narrative also meant countering the anti-China climate in the global trading system.
“We know that the vast majority of growth and poverty reduction in the last thirty years has actually occurred because of China,” she said.
“We should be looking at China's model and seeing what can be extracted as a model for other countries – not adopting at wholesale but looking at what can be extracted – including issues like government regulation of the financial sector, domestic investment in production, control of the central bank, and public ownership of production,” she added.
The discussion, which was streamed live on Facebook (starts at around minute 12), took place during a civil society hearing organized by UNCTAD’s top management.
The purpose was to engage with non-governmental organizations, think tanks, trade unions and business associations on the issues that the organization will discuss with its member countries during the annual meeting of its governing body – the Trade and Development Board – scheduled for 4-12 June.
In addition to the new ways that the United Nations could address the crisis of multilateralism and trade, the themes discussed were:
Industrial policies and productive capacity policies for a digital economy
Plugging financial leakages, mobilizing domestic and international resources to deliver the Sustainable Development Goals
Building resilience to multiple shocks affecting people and sustainable development
