Sir, Your editorial “Global leaders must back broader growth tactics” (July 13) on this week’s Financing for Development conference in Addis Ababa, rightly centres on the disconnect between diplomatic rhetoric and real world action when it comes to fostering development. Nowhere is this more apparent than on the issue of reforming the global trading system in support of the world’s poorest.
If we are to make 2015 the year of sustainable development, the Addis declaration must mark the start of a concerted push to deliver on three longstanding commitments.
First, governments should ratify and implement the World Trade Organisation’s Trade Facilitation Agreement (TFA) without delay. This deal — forged in 2013 but ratified by only eight governments to date — would have a transformational effect on the ability of entrepreneurs in developing countries to access global markets by reducing unnecessary red tape at borders. Implementing the TFA, which would also support broader efforts to eliminate corruption and reduce rates of food wastage, should be seen a quick win to deliver on the promise of the post-2015 development agenda.
Second, action is needed to address a growing shortage of bank finance to support trade. Trade finance is one of the safest forms of financing and has the advantage of directly promoting development through trade. According to the Asian Development Bank, there is currently a $1.9tn financing gap for trade globally — with as much as $900bn of the shortfall in developing Asian economies alone. The causes of this problem are multi-faceted: from skills shortages in the financial and commercial sectors through to the unintended effects of national financial crime policies. None will be easy to resolve, but that must not be an excuse for inaction.
Finally, it is imperative that world leaders exercise the political will to conclude the long-stalled Doha Round of trade talks after almost 14 years of periodic crises and missed deadlines. Recent reports have once again called into question whether governments will be able to meet their latest goal of striking a grand bargain by the end of the year. G20 leaders, in particular, must definitively commit to an agreement and give their negotiators the necessary latitude to deliver it. Concluding the round would send the clearest of signals that the international community is finally serious about turning words into action when it comes to enabling trade for development. We must all invest the time and effort to get the Doha deal done.
International Chamber of Commerce,