Least Developed Countries (LDCs) face obstacles to improving their trade capacity, but there are opportunities on the horizon
Enhanced Integrated Framework (EIF) head Ratnakar Adhikari discusses the trade outlook for Least Developed Countries (LDCs), what the EIF is doing to support local industry and what trends he's seeing for greater and deeper impact.
How do you see the trade for development landscape in 2018?
The WTO's multilateral negotiations are facing challenges, especially following the 11th Ministerial Conference in Buenos Aires in December and despite good progress made in the run-up to the conference on some issues. It may not possible for each ministerial to deliver concrete outcomes, but what is important is that WTO members continue to talk to each other with a view to achieving positive results. This is precisely what is happening now.
Members are discussing topics like e-commerce; micro, small and medium-sized enterprises; gender; and investment facilitation, among others. We don’t know how these group discussions will evolve in terms of direction and outcomes, but these are open-ended talks with the possibility of others joining.
Aside from thematic discussions, has there been progress on the regional front or anything else of import for LDCs?
Because of relatively slow progress on the multilateral front, some WTO members may start negotiating at the regional level, as they consider that it is relatively easier to achieve results in such fora. However, from my conversations with LDCs I get a sense that they are equally aware of the fact that their interests are best protected within the multilateral trading system.
In terms of the global economic landscape, the ongoing recovery is still fragile, and most of the recovery has not created a lot of space for LDCs to integrate themselves. There are still geopolitical risks and risks related to the financial situation at the global level, and risks related to the fragility of economic growth itself.
And the LDCs share of global trade is not increasing. In 2014 it was almost one percent and it's been going down. The reason is that LDCs are dependent on the export of commodities – mostly oil and minerals – and commodity prices have dwindled considerably in the past three years.
In 2010 the global community through the Istanbul Programme of Action for the LDCs made a commitment to increase developing countries' share of world trade by 2020, and the Sustainable Development Goals in 2015 have only reinforced that commitment. But now there is the challenge of doing so. Our agenda at EIF is to support the poorest countries improve their trade and to help diversify their exports and work toward higher value-added products.