Transcript The World Bank Group - Kemerovo State University

Global Economic Prospects and
the Developing Countries 2002
Making Trade Work for the World’s Poor
October, 2001
The international environment has become
harsh for developing countries
12
10
8
6
4
2
0
-2
-4
-6
-8
-10
13.3
2000
2001
7.1
6.7
7.7
3.6
1.0
240 160
-1.3
-8.9
World trade
Non-oil
LIBOR (%) Spreads (%)
growth
commodities
Cap. flows
($bn)
Simultaneous downturn in rich countries
(Industrial production, percent change, 3-month/3-month, saar)
12
6
EU-15
0
-6
United States
-12
Japan
-18
Jan-00
May-00
Sep-00
Jan-01
May-01
Sep-01
Sharp deterioration after September 11th
150 bp
125 bp
-15%
U.S.
consumer
confidence
-2.5%
U.S. retail
sales
-6.5%
High yield
spreads
Emerging
market
spreads
Commodity
prices
-15%
Oil price
Sharp downturn for developing countries…
(Real GDP, percent change over previous year)
8
2000
7
2001
6
5
4
3
2
1
0
East Asia
South Asia
Latin
America
Europe & Middle East
Central Asia & North
Africa
SubSaharan
Africa
… and delayed recovery
(Real GDP, percent change over previous year)
8
2000
2001
7
2002
2003
6
5
4
3
2
1
0
East Asia
South Asia
Latin
America
Europe & Middle East
Central Asia & North
Africa
SubSaharan
Africa
Poverty declines, but not everywhere
(Number of persons living on less than $2 per day)
1990
Millions
1999
2015
1200
1000
800
600
400
200
0
South Asia
East Asia Sub-Saharan
Latin
Africa
America
Middle East Europe &
& North Central Asia
Africa
Developing countries have now become
major players in world trade...
Percent
35
30
Developing countries’ share
25
20
15
10
5
0
1970
1975
1980
1985
1990
1995
Developing countries have now become
major players in world trade...
US$ billion
Percent
35
2,000
30
1,600
Developing countries’ share (lhs)
25
Agriculture 1,200
20
15
800
10
5
0
1970
400
Energy & other
Manufactures
0
1975
1980
1985
1990
1995
–but poor countries did less well
(Percentage point change world share, 1991-99
Non-energy merchandise exports)
7
6
5
4
3
2
1
0
Middle-income
countries
Other low-income
countries
LDC
… one reason is that products produced by the poor
face higher barriers to trade
Tariff faced by each group (in %, 1997-98)
16
14
12
10
8
6
4
2
0
Poor (<$2/day)
Non-poor (>$2/day)
Reshaping the Global Trade Architecture for
Development… Main Recommendations
WTO: A development round would improve market
access for agriculture, textiles and services
 High-income countries: ensure trade policies promote
access and are not detrimental to poor countries
 Developing countries: trade and other policies remain
the most important determinant of growth prospects
 Multilateral cooperation outside the WTO can help
build trade capacity and create sound environmental
and labor standards: ‘aid for trade’

Trade liberalization would accelerate growth
(Cumulative additional (discounted) income in 10 years
following liberalization)
$ trillion
1.5
1.4
1.3
1.2
1
0.8
0.6
0.4
0.2
0
Low- and middle-income
High-income
—implying a substantial additional reduction
in poverty
(Number of persons living on less than $2 per day)
1990
Millions
1999
2015 (w/out trade reform)
1200
1000
800
600
400
200
0
South Asia
East Asia Sub-Saharan
Latin
Africa
America
Middle East Europe &
& North Central Asia
Africa
—implying a substantial additional reduction
in poverty
(Number of persons living on less than $2 per day)
Millions
1990
1999
2015 (w/out trade reform)
2015 (w/ trade reform)
1200
1000
800
600
400
200
0
South Asia
East Asia Sub-Saharan
Latin
Africa
America
Middle East Europe &
& North Central Asia
Africa