Background Paper 1 Trade and Development in the Commonwealth

Transcription

1 Background Paper 1 Trade and Development in the Commonwealth APPG for Trade Out of Poverty Inquiry: Can the Commonwealth help developing countries trade out of poverty? November 2017

2 Table of Contents 1. Introduction Background The Commonwealth as a Global Leader... 5 Small and Vulnerable States... 5 Climate Change... 6 Debt Management... 6 The G Trade Facilitation... 7 The WTO Trade Facilitation Agreement... 8 The Hubs and Spokes Trade Programme Tariff Preferences Maximising the benefits of tariff preferences Rules of Origin Information and Communication Technology Connectivity and Broadband Subscription E-commerce and Data Protection in the Commonwealth Trade Finance and SMEs The Finance Gap The Commonwealth Trade Finance Facility Women in Trade Closing the Gender Gap in the Commonwealth International Initiatives aimed at promoting WEE Trade Skills The Commonwealth of Learning Developing Trade Skills Engaging the Youth Green Growth Commonwealth Climate Initiatives Multilateral Initiatives aimed at promoting Green Growth Aid for Trade Commonwealth Trademark System The WIPO Madrid System Trade Governance Trade and Investment Expo The Commonwealth Trade Ministers Meeting Annexes Prepared by: Stacey Mills-Smith, APPG-TOP Secretariat 2

3 1. Introduction This Background Paper has been prepared for the Committee leading the All-Party Parliamentary Group for Trade Out of Poverty (APPG-TOP) Inquiry into the Commonwealth s ability to help developing countries trade out of poverty. Its purpose is to provide an introduction to the work of the Commonwealth, particularly in relation to key trade and development initiatives, and expand on the 10 Commonwealth Policy Priorities for Trade and Development published by the APPG-TOP and Overseas Development Institute (ODI) in March The Commonwealth has long worked to promote sustainable development among its member states, with trade being a recognised vehicle through which to reduce poverty and improve livelihoods. While no specific Commonwealth mandate on trade and development currently exists, the inaugural Commonwealth Trade Ministers Meeting (CTMM), which took place in London in March 2017, highlighted the importance the Commonwealth heads of government place on improving conditions for trade and investment. It also emphasised their commitment to a free and fair multilateral trading system. The 10 Commonwealth Policy Priorities for Trade and Development booklet released in the lead up to the CTMM was put forward to stimulate debate and ensure Commonwealth trade ministers kept a focus on trade and investment policies and programmes that would enhance development outcomes. Some six months later, the APPG-TOP launched its Inquiry into the potential of the Commonwealth its member states, business and civil society organisations, as well as its own Commonwealth institutions to help developing countries use trade and investment to reduce poverty and accelerate economic growth. The aim of the Inquiry is to make a powerful case for an ambitious trade and development agenda for the Commonwealth as a whole. Key questions the Inquiry is seeking to answer: What challenges do developing countries (particularly least developed countries and small island states) in the Commonwealth face in terms of harnessing trade and investment as tools to meet their development objectives? Please provide examples (personal experience and/or research findings)? What opportunities can be identified within the Commonwealth to foster faster, more transformative economic growth, employment and poverty reduction for developing countries through expanding trade and investment? What programmes and initiatives do Commonwealth institutions and member states currently offer to promote trade and investment for sustainable development? How are these regarded and is there scope to scale-up and achieve more impact? Is the Commonwealth reaching its full potential for co-operation in this area? How can trade and development policies and programmes be best designed to maximise the shared gains from trade and investment and reduce poverty in the Commonwealth? Are there examples of best-practice trade and development policies/initiatives that have either been or could be deployed in developing countries within the Commonwealth? What is the Commonwealth best-placed to do to promote prosperity amongst its developing country members compared to other development partners such as the World Bank or UN agencies? What should the priorities be for a new work programme for the Commonwealth on trade and development over the next 5-years? 3

4 2. Background The Commonwealth is an association of 52 independent states, representing roughly 30 per cent of the world s population. A unique feature of the Commonwealth is the diversity of its member states, which comprise a mix of advanced and developing economies of various sizes, spanning Africa, Asia, the Pacific, the Americas and Europe. Bound by historical links to the former British Empire, the Commonwealth is further united by its shared values and aspirations, namely democracy, human rights and the rule of law, which are enshrined in the Charter of the Commonwealth. An important feature of the Commonwealth is that all members, regardless of size or income, have an equal say in decision-making. The Commonwealth s policies and priorities are shaped by the leaders of member countries and formally discussed biannually at the Commonwealth Heads of Government Meeting (CHOGM). The next CHOGM is taking place in London in April The theme for the 2018 CHOGM is Towards a Common Future, with the four main goals for the Summit being: Prosperity: boosting intra- Commonwealth trade and investment. (With a particular focus on women, youth, skills and employment.) Security: increasing cooperation across security challenges including global terrorism, organised crime and cyber attacks. Core Values and Principles of the Commonwealth 1. Democracy 2. Human Rights 3. International Peace and Security 4. Tolerance, Respect and Understanding 5. Freedom of Expression 6. Separation of Powers 7. Rule of Law 8. Good Governance 9. Sustainable Development 10. Protecting the Environment 11. Access to Health, Education, Food and Shelter 12. Gender Equality 13. Importance of Young People in the Commonwealth 14. Recognition of the Needs of Small States 15. Recognition of the needs of Vulnerable States 16. The Role of Civil Society Source: The Charter of the Commonwealth Fairness: promoting democracy, fundamental freedoms and good governance across the Commonwealth. Sustainability: building the resilience of small and vulnerable states to deal with the effects of climate change and other global crises. In the days leading up to CHOGM, the People s Forum, the Youth Forum, the Women s Forum and the Business Forum will also take place in London. Established in 1965, the Commonwealth Secretariat works with member governments to execute the plans agreed by Commonwealth Heads of Government. It also promotes international consensus- building, facilitates the work of the more than 80 Commonwealth organisations, and provides technical assistance and advisory services to members through the Commonwealth Fund for Technical Cooperation (CFTC) with the goal to foster inclusive and equitable development. 4

5 Nominated by Commonwealth leaders, the Secretary-General leads the organisation and can serve a maximum to two four-year terms. The current Secretary-General, the Rt Hon Patricia Scotland QC, assumed office on 1 April 2016 (see the Commonwealth Secretariat s organogram in Annex 1). The Commonwealth Secretariat Fund, the Commonwealth Youth Programme (CYP) Fund, and the CFTC collectively fund the Secretariat s work. The first two are financed by assessed contributions from member governments, which are primarily based on capacity to pay, while the CFTC is financed by voluntary contributions from member governments. In 2015/16, the Secretariat had an approved budget of 47.9 million and a direct budget of 33.7 million comprised of 11.1 million (33%) from the Commonwealth Secretariat fund, 3.2 million (9%) from the CYP fund, and 19.4 million (58%) from the CFTC. Commonwealth Member States Africa Botswana Cameroon Ghana Kenya Lesotho Malawi Mauritius Mozambique Namibia Nigeria Rwanda Seychelles Sierra Leone South Africa Swaziland Uganda Tanzania Zambia Asia Bangladesh Brunei Darussalam India Malaysia Pakistan Singapore Sri Lanka Europe Cyprus Malta United Kingdom Caribbean and Americas Antigua & Barbuda The Bahamas Barbados Belize Canada Dominica Grenada Guyana Jamaica Saint Lucia St Kitts and Nevis St Vincent & The Grenadines Trinidad and Tobago Pacific Australia Fiji Kiribati Nauru New Zealand Papua New Guinea Samoa Solomon Islands Tonga Tuvalu Vanuatu 3. The Commonwealth as a Global Leader The Commonwealth has championed a number of issues of global significance, including climate change, debt management, and the challenges faced by small states. It drives progress through effective global advocacy and active participation in international fora, such as the G20. In tackling these issues, tools and resources have been developed to the benefit of both Commonwealth and non-member states. This section briefly outlines a few areas where the Commonwealth has been a global champion and the impact of its work to date. Small and Vulnerable States Small and Vulnerable States (SVSs) face inherent disadvantages, such as their susceptibility to natural disasters as well as economic and financial shocks, while Small Island Developing States (SIDS) have the additional challenge of their geographic remoteness. With 31 small states 1 in the Commonwealth, 25 of which are SIDS, the organisation has played a key role in amplifying and addressing the unique challenges faced by SVSs in international arena. 1 The countries defined as small states are independent states with populations of up to 1.5 million. 5

6 To help deepen the understanding of the developmental issues facing SVSs, the Commonwealth has convened the Global Biennial Conference on Small States since Key Commonwealth initiatives targeted at assisting SVSs include: The Commonwealth Vulnerability Resilience Framework (VRF) Established in 2004 with the University of Malta and expanded in Designed to help countries better measure their susceptibility to shocks, including financial crises and extreme weather events. Information used to develop targeted national policies as well as build international support and help secure financing. Now used globally, including by institutions such as the World Bank and UN. Has helped build recognition of SVS resulting in a more tailored response to their needs. Technical assistance Commonwealth Small States Office established in Geneva in 2011 Aimed at building the capacity of Commonwealth small states to enable better and more effective participation in the multilateral trading system. Climate Change Evidence suggests that SVSs and Least Developed Countries (LDCs) are disproportionately affected by the impacts of climate change, which are hampering progress on poverty alleviation. Of the 100 countries classified as most vulnerable to climate change, 45 are Commonwealth countries and 27 are Commonwealth SIDS. 2 Recent natural disasters including the mudslides in Sierra Leone and hurricanes Irma and Maria that devastated islands in the Caribbean, highlight the importance of collective action to find solutions to climate change and vulnerability challenges. The Commonwealth first committed to play an active role in environmental protection when leaders signed the Langkawi Declaration on the Environment in 1989, prior to the Rio Earth Summit in Since then the Commonwealth has continued to be a global leader in the fight against climate change. In addition to advocating and intervening at high-level forums such as the UN, IMF and World Bank, the Commonwealth have demonstrated their commitment to tackle climate change through The Commonwealth Climate Change Declaration made by Commonwealth leaders during a special session on Climate Change in Port of Spain in 2009, and the Commonwealth Leaders Statement on Climate Action signed at CHOGM in Key Commonwealth initiatives aimed at addressing climate change include the Green Finance Facility, Youth Climate Change Network and the Climate Finance Access Hub, which will be discussed in more detail in Section 10. Debt Management Many Commonwealth countries lack the capacity to effectively manage their debt due to weak institutional structures and limited access to funding. The Commonwealth has been addressing sovereign debt since the 1980s and has contributed to major initiatives such as the Paris Club and the Naples Terms. In addition to providing policy advice, capacity building and advocacy support to 2 Commonwealth Secretariat Strategic Plan 2013/14 6

7 member countries, the Commonwealth helps states sustainably manage their debt through initiatives including the Heavily Indebted Poor Countries Initiative and the Debt Recording and Management System. Heavily Indebted Poor Countries Initiative Established in the 1990s and supported by the IMF Aims to provide relief and lowinterest loans to cancel or reduce the debt of the poorest countries. Has contributed to vital debt relief including for 36 countries that have benefited from the initiative Debt Recording and Management System Enables managers to access and evaluate information on long-term, short-term, public and privately secured external and domestic debt. Manages a global portfolio of more than $2.5 trillion of public debt. Used by >100 government agencies in over 60 countries, including 15 non- Commonwealth members. The G20 The Group of Twenty (G20) is comprised of 19 countries plus the European Union. The 19 countries are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the United Kingdom and the United States of America. A major grouping in the global economic and development arena, G20 countries account for around 80 per cent of global economic output, three-quarters of global trade and encompass two-thirds of the world's population. Recommendations made by the Eminent Persons Group (EPG) in their 2011 report, A Commonwealth of People: Time for Urgent Reform, and the Perth CHOGM mandate stressed the need for the Commonwealth to work with the G20 to strengthen the voice and representation of developing countries in international economic decision-making. Since that time the Commonwealth-G20 relationship has grown and there is now an annual dialogue between the Commonwealth, the Organisation Internationale de la Francophonie and the G20. The Commonwealth also actively participates in G20 Development Working Group where it has been particularly effective in articulating the priorities of small states and suggesting practical solutions to development challenges. For more on how the Commonwealth adds global value, click here. The remainder of this paper examines in more detail the 10 points set out in the 10 Commonwealth Policy Priorities for Trade and Development publication and highlights how the relate to the Sustainable Development Goals (SDGs). 4. Trade Facilitation Trade Facilitation refers to the simplification, modernisation and harmonisation of export and import processes. Improving trade facilitation can be a key contributor to sustainable development and an important conduit for poverty alleviation. 3 The Commonwealth has an opportunity to boost trade and reduce trading costs among its membership through the ratification and implementation of the WTO Trade Facilitation Agreement (TFA). 3 WTO, Trade Facilitation, 7

8 The WTO Trade Facilitation Agreement The WTO TFA negotiations were concluded at the 2013 Bali Ministerial Conference and the agreement entered into force on 22 February 2017 after it was ratified by two-thirds of the WTO Membership. Implementation of the TFA will be a major undertaking for most developing countries but doing so presents an important opportunity to improve and expedite the movement, release and clearance of goods at customs borders. The ensuing efficiency gains will help reduce trade costs and enhance participation in global value chains. While the Commonwealth is not a formal trading block, a recent study found that trade costs are 19 per cent lower and countries tend to trade 20 per cent more when bilateral trade takes place between Commonwealth countries. The growth of intra- Commonwealth trade is set to continue with the value of trade forecast to surpass $1 trillion by Implementation of the TFA could help propel this growth by reducing trade costs. Indeed, the 2015 OECD Trade Facilitation Indicators find that implementation of the TFA could reduce trade costs worldwide by between 12.5% per cent and 17.5 per cent. Low and lower middle income countries have the greatest opportunity to reduce trade costs. 5 Currently, 37 of the 48 Commonwealth WTO member states have ratified the TFA; up from 33 in February 2017 (see Table 1). The latest Commonwealth countries to ratify the TFA were Fiji, Sierra Leone, Malawi and Rwanda. Ratification by the remaining Commonwealth countries would allow them to build on their already strong trading relationships and further reduce costs of doing business. The Hubs and Spokes Trade Programme Many Commonwealth countries in African, Caribbean and Pacific (ACP) regions have struggled to take full advantage of the rapid escalation in economic growth since the late 1990s. To assist the ACP group of states to integrate into the global economy and to contribute to their sustainable development, the Commonwealth, along with other partner organisations, provide technical assistance. This assistance is delivered through the Hubs and Spokes Trade Programme, which boosts their capacity to more effectively develop and implement trade policies and agreements and supports regulatory reform. Ensuring eligible Commonwealth member states receive the assistance they need to implement the TFA will help ensure the benefits of the agreement are realised in a timely manner. 4 The Commonwealth in the Unfolding Global Trade Landscape: Prospects Priorities Perspectives, Commonwealth Trade Review Available at: CTR2015.pdf 5 The Commonwealth Secretariat, 2016, Emerging Issues Briefing Note 5, Trade Facilitation Agreement: Implementing Implication. Available at: 8

9 Table 1 Commonwealth TFA Ratifications and Notifications Source: WTO 9

10 Relevant SDGs 9.1 Develop quality, reliable, sustainable and resilient infrastructure, including regional and trans-border infrastructure, to support economic development and human wellbeing, with a focus on affordable and equitable access for all. 9.A Facilitate sustainable and resilient infrastructure development in developing countries through enhanced financial, technological and technical support to African countries, least developed countries, landlocked developing countries and small island developing States Significantly increase the exports of developing countries, in particular with a view to doubling the least developed countries share of global exports by Also: 8.1, 8.2, 8.3, 9.c, 10.b, 16.10, 16.6, 17.1, &17.17, Trade Facilitation - 10 Commonwealth Policy Priority Actions: Achieve full TFA ratification from all 48 Commonwealth WTO member states by the CHOGM in 2018; Achieve full implementation of TFA Category A and B provisions within five years from entry into force, and within 10 years for Category C provisions; Conduct regular tracking and reporting on ratification, implementation and outcomes 5. Tariff Preferences Preferential trade schemes are in place in numerous developed countries and, more recently, some emerging developing countries. Preferences include the EU s Everything But Arms (EBA) scheme, which provides duty-free and quota-free (DFQF) access to all LDCs, and similar schemes offered by Australia, New Zealand and Canada. The value of preferential access to the UK for Commonwealth developing country goods is 715 million, equivalent to the value of 3.2 per cent of their total exports. Since the publication of the 10 Commonwealth Policy Priorities for Trade and Development in March 2017, the UK Government has announced it will introduce preferences to LDCs after it has exited the EU and extend preferences at least as good as those offered by the EU to other countries. For the Commonwealth as a whole, there remains scope to do more in terms of goods and services preferences, including working to counteract the erosion of preferences to the benefit of developing member states. On average, tariffs applied by large and developed Commonwealth members to developing ones are just 1 per cent lower than those applied to non-commonwealth countries. Moreover, the Commonwealth has the potential to help improve the utilisation of existing preference. 10

11 Maximising the benefits of tariff preferences Many developing countries and LDCs have benefited from tariff preferences, which are designed to enable them to build their trade capacity and expand their exports. The issue of tariff preferences is particularly pertinent to small states, some of whom are not LDCs, because their exports tend to be highly concentrated and they tend to suffer general development challenges, such as poor investment climates and high trade costs. Over time, tariff preferences have been eroded through unilateral trade liberalisation as well as liberalisation occurring through regional trade agreements. This can hamper developing countries ability to grow their share of global trade, because despite the growth in South-South trade, developed countries remain important export markets for many Commonwealth developing country members. While some have managed to successfully diversify their exports to be less reliant on preference, small states in particular have found this transition difficult to achieve. Where tariff preferences exist there remains the problem of under utilisation, which may be due to a number of reasons including restrictive rules of origin (RoO), preferential agreements excluding important high tariff goods or a mismatch between the goods exported from developing countries and the goods to which preferences apply. Rules of Origin RoO are the criteria used to determine the national source of a product being imported. One application of RoO is in the determination of eligibility for products to receive preferential treatment. The GATT contains no rules governing the determination of the country of origin of goods so there now exists a multiplicity of RoO, which can be complex, opaque, and difficult to apply. The globalised nature of supply chains and the proliferation of preferential trading arrangements with their own various RoO, has led to calls for greater harmonisation and less restrictive RoO. One motivation for doing so is to ensure better integration of developing countries into the world economy through improved market access, including through increasing the utilisation of preferential tariffs. Providing the maximum benefits possible to Commonwealth LDCs and SVSs through preferential tariff systems, and improving the utilisation of existing preference systems, is key to promoting economic development through trade. Relevant SDGs 10.A Implement the principle of special and differential treatment for developing countries, in particular least developed countries, in accordance with World Trade Organization agreements 17.7 Promote the development, transfer, dissemination and diffusion of environmentally sound technologies to developing countries on favourable terms, including on concessional and preferential terms, as mutually agreed Realize timely implementation of duty-free and quota-free market access on a lasting basis for all least developed countries, consistent with World Trade Organization decisions, including by ensuring that preferential rules of origin applicable to imports from least developed countries are transparent and simple, and contribute to facilitating market access. 11

12 Tariff Preferences - 10 Commonwealth Policy Priority Actions: For those countries with the means to do so, commit to offering the maximum benefits possible to Commonwealth developing countries through preferential tariff systems; Introduce liberal rules of origin and facilitate their certification; Provide assistance, where necessary, to preference recipients to ensure benefits are fully realised. 6. Information and Communication Technology Improving access to information and communication technology (ICT) infrastructure can play an important role in enhancing trade. However, barriers in the form of data security laws and data management regulations can hamper the development of the digital economy in LDCs and SVSs. Connectivity and Broadband Subscription According to the International Telecommunications Union, 95 per cent of the world s population is covered by a mobile-cellular network, yet the networks only reach 67 per cent of the rural population. Despite the rapid dissemination of digital technology globally, 53 per cent of the world s population does not yet use the Internet. In LDCs, only one in seven people are using the internet and the internet user gender gap remains large at 31 per cent. Broadband affordability is a key issue and fixed broadband penetration remains particularly low in Africa and across the LDCs, where it stands at less than 1 per cent. Mobile broadband is more affordable and subscriptions have been growing rapidly in developing countries, reaching penetrations rates of roughly 40 per cent. 6 By building capacity and the right policy foundation, developing countries have the opportunity to leapfrog older technologies and facilitate the rapid rollout of broadband infrastructure. E-commerce and Data Protection in the Commonwealth The Commonwealth Telecommunications Organisation (CTO) was established in 1967 and is the oldest and largest Commonwealth organisation engaged in multilateral collaboration in the field of ICT. Commonwealth ICT Ministers recently endorsed the CTO s Strategic Plan for , which aims to assist members in their efforts to achieve the SDGs. As the world s economies become increasingly digitised, investment in infrastructure that supports e-commerce will be required to successfully connect and integrate Commonwealth countries through value chains, especially for small Commonwealth states. Across the Commonwealth data protection is governed by domestic legislation. To aid with harmonising national legislation, the Commonwealth Secretariat has developed the Commonwealth Model Law on Computer and Computer Related Crime, which contains provisions on data protection, privacy, cyber security and cyber crime. Ensuring that individuals and businesses across the 6 International Telecommunications Union, ICT Facts and Figures 2016, D/Statistics/Documents/facts/ICTFactsFigures2016.pdf 12

13 Commonwealth can access secure online, cross-border transactions is crucial for enabling economic growth through e-commerce. For developing countries with weaker legal frameworks governing the exchange of electronic data, these factors have a particularly significant impact on trade and development. Relevant SDGs 5.B Enhance the use of enabling technology, in particular information and communications technology, to promote the empowerment of women. 9.C Significantly increase access to information and communications technology and strive to provide universal and affordable access to the Internet in least developed countries by ICT - 10 Commonwealth Policy Priority Actions: Introduce national e-commerce working groups to develop policy responses and programmes to meet ICT for trade needs Set broadband subscription targets by widening cost-free access, and conduct regular reviews of ICT capabilities for each country Ensure that data location or security laws are defined in a way that enhance countries ability to leverage the benefits of the digital economy. 7. Trade Finance and SMEs SME finance is an important channel of growth and with up to 80 per cent of global trade being facilitated by trade financing or insurance, it is imperative to support and enhance trade-financing systems. Expanding trade finance for SMEs and small Commonwealth states can act as a catalyst to boost exports and can accelerate growth and formal employment in developing countries. The Finance Gap According to the Wold Bank, SMEs in emerging markets are responsible for creating 4 out of 5 new positions in the formal economy. In low-income countries, SMEs contribute close to 50 per cent of total employment and this number is higher when informal SMEs are included. However, more than 50 per cent of SMEs lack finance and often face significant challenges in securing trade finance; over half the trade finance requests made by SMEs are rejected. 7 The trade finance gap (i.e. unmet financial demand) currently stands at $120 billion for Africa and $700 billion for developing Asia. The Commonwealth Trade Finance Facility The Commonwealth, alongside the Governments of Malta, Mauritius, Sri Lanka, and India, announced the establishment of a new Commonwealth Trade Finance Facility at the 2015 CHOGM in Malta. This followed a mandate issued at the Commonwealth leaders summit 2013 to help small and developing Commonwealth countries 7 WTO, Trade Finance and SMEs, 13

14 increase their trade capacity. The Commonwealth Trade Finance Facility is a voluntary fund that will act as a guarantor, backing approximately 20 per cent of trade finance exposures faced by international banks that deal with small Commonwealth states lacking sufficient trade finance. Continued investment in the fund by Commonwealth member states and other parties will be crucial to its success in helping small traders in small countries penetrate new markets. Relevant SDGs 8.3 Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation, and encourage the formalization and growth of micro-, small- and medium-sized enterprises, including through access to financial services Strengthen the capacity of domestic financial institutions to encourage and expand access to banking, insurance and financial services for all. 9.3 Increase the access of small-scale industrial and other enterprises, in particular in developing countries, to financial services, including affordable credit, and their integration into value chains and markets. Trade Finance & SMEs - 10 Commonwealth Policy Priority Actions: Increase the number of investors in the Commonwealth Trade Finance Facility, with a target of doubling the fund upon each biennial review. 8. Women in Trade Women are particularly active in informal sectors and SMEs; close to 10 million SMEs are owned by women internationally. In Kenya, for example, 24 per cent of SMEs are owned by women, while in Rwanda the figure is 26 per cent. Nevertheless, many social, economic and legal barriers still exist that can limit women s opportunities to enter the workforce, progress in the careers and grow their businesses. Implementing trade policies and Aid for Trade (AfT) initiatives that encourage greater participation of women in trade is key for inclusive development. It is estimated that by eliminating barriers to women in the workforce, the Asia-Pacific region could increase its output by up to US$47 billion each year. 8 Closing the Gender Gap in the Commonwealth The Commonwealth Secretariat have identified the following as areas of particular importance in terms to improving gender equity and promoting sustainable development: Lack of access to finance for women entrepreneurs Limited access to procurement and global markets Underrepresentation of women on corporate boards Women s underrepresentation in political systems and leadership Violence Against Women (VAW) 8 Asian Development Bank and International Labour Organization Bangkok. Women and Labour Markets in Asia: Rebalancing for Gender Equality. 14

15 One of the key avenues through which the Commonwealth is helping to promote gender equality is through gender-responsive budgeting. The Commonwealth Secretariat have contributed to the integration of gender sensitive budgeting in 25 Commonwealth member countries to date and have placed gender on the agenda of the Commonwealth Finance Ministers meeting as well as other high-level conferences. The inaugural Commonwealth Women s Forum was held in the lead up to CHOMG in Malta in 2015 and will now take place alongside the Business Forum, Youth Forum and People s Forum at future Commonwealth Summits. The Women s Forum aims to raise awareness of women s issues across the Commonwealth and demonstrate the positive social, economic and political impact from women s contributions on a local, national and international level. An accredited Commonwealth organisation, the Commonwealth Businesswomen s Network (CBW) also aims to promote women s economic empowerment. Relaunched at the 2011 CHOGM in Perth, the CBW connects and supports women in businesswomen across the Commonwealth and advocating on their behalf. International Initiatives aimed at promoting women s economic empowerment United Nations Women s Empowerment Principles The UN Women s Empowerment Principles (the Principles) recognise that empowering women to fully participate in economic life is essential to build strong economies and achieve internationally agree goals such as the SDGs. Indeed, if women fully participated in formal labour markets, it is estimated that GDP could increase by $28 trillion by The Principles offer guidance for business on how to empower women workplace, marketplace and community. Currently, of the 1, companies that have signed up to the Principles, only 289 are from Commonwealth countries, with South Africa and India alone accounting for one third of the total. UN s Women s Empowerment Principles Principle 1 Principle 2 Principle 3 Principle 4 Principle 5 Principle 6 Principle 7 Establish high-level corporate leadership for gender equality Treat all women and men fairly at work respect and support human rights and non-discrimination Ensure the health, safety and well-being of all women and men workers Promote education, training and professional development for women Implement enterprise development, supply chain and marketing practices that empower women Promote equality through community initiatives and advocacy Measure and publicly report on progress to achieve gender equality SheTrades SheTrades is an initiative launched by the International Trade Centre in It aims to help female entrepreneurs overcome the hurdle of identifying eligible companies to engage with as potential suppliers by connecting women to markets through the SheTrades app. On the flip side, it helps corporations to include more women 9 UN Women, 10 As at 27 October

16 entrepreneurs in their supply chains. SheTrades hopes to connect one million women entrepreneurs to market by Encouraging Commonwealth member states to take unilateral as well as collective action to help empower women economically particularly through trade will help advance welfare for all. Relevant SDGs 5.A Undertake reforms to give women equal rights to economic resources, as well as access to ownership and control over land and other forms of property, financial services, inheritance and natural resources, in accordance with national laws. 5.1 End all forms of discrimination against all women and girls everywhere. 5.5 Ensure women s full and effective participation and equal opportunities for leadership at all levels of decision-making in political, economic and public life. Women in Trade - 10 Commonwealth Policy Priority Actions: Encourage Commonwealth countries to support initiatives assisting women in business, such as the International Trade Centre s SheTrades programme, which facilitates connections between women owned enterprises; Encourage corporations in Commonwealth countries to sign up to and adopt the United Nations Women s Empowerment Principles. 9. Trade Skills Human capital is a key building block for prosperity. Individuals skills and capabilities need to be developed so that people young and old, male and female, can engage in international trade. Skill development is often hampered in least developed countries and SVSs by individuals geographical and digital remoteness. The Commonwealth can enhance trade skills by expanding existing educational programmes as well as exploring new and innovative ways to address the education deficit present in some member states. The Commonwealth of Learning Created by Commonwealth Heads of Government and hosted by the Government of Canada, the Commonwealth of Learning (COL) is focussed on the promotion and development of distance education and open learning. COL is helping developing nations improve access to quality education and training by encouraging the development and sharing of open learning/distance education knowledge, resources and technologies. Established in 2002, the Commonwealth Executive Master of Business Administration and Public Administration Programme is the outcome of collaboration between the COL and four open universities in South Asia. The Programmes aim to deliver high quality learning and professional development opportunities and is 16

17 currently expanding through partnership with institutions across the Commonwealth and beyond. Developing Trade Skills Trading goods and services internationally can be a challenging task, particularly for SMEs and businesses in LDCs and SVSs where information and support can be difficult to access and the trade costs are high. Training and education to help businesses navigate the complexity of doing business internationally is key to increasing trade and promoting economic empowerment. By supporting initiatives that develop trade skills, particularly in developing countries, the Commonwealth can help improve the trade performance of businesses and support long-term economic growth. Engaging the Youth The Commonwealth is home to 2.4 billion citizens and over 60 per cent of these are under the age of 30. Youth participation in economic, social and political processes plays an increasingly important role in today s societies. There is broad recognition across public and private sectors that empowering youth can help drive the achievement of the SDGs. Facilitating the transfer of knowledge and skills through exchange programmes for young professionals is one avenue through which the Commonwealth can contribute to developing the skills and networks needed to boost trade. Relevant SDGs 4.3 By 2030, ensure equal access for all women and men to affordable and quality technical, vocational and tertiary education, including university. 4.4 By 2030, substantially increase the number of youth and adults who have relevant skills, including technical and vocational skills, for employment, decent jobs and entrepreneurship. Trade skills - 10 Commonwealth Policy Priority Actions: Expand the Commonwealth of Learning s Executive MBA and MPA programmes to include more blended learning options (incorporating e- learning) from a greater range of academic institutions across the Commonwealth; Promote international exchange programmes for young professionals through the Commonwealth Enterprise and Investment Council (CWEIC). 10. Green Growth The concept of green growth has its origins in the Asia and Pacific Region and centres around the need to harmonise economic growth with environmental sustainability. 11 Trade and investment will continue to play a pivotal role in the 11 UN, Sustainable Development Knowledge Platform, 17

18 acceleration of green growth and emissions reductions through the diffusion of green technologies (including through trade in environmental goods) and increased employment in green jobs sectors. By building on its existing work and supporting other key initiatives aimed at promoting green growth, the Commonwealth can further help member states develop sustainably through trade and investment. Commonwealth Climate Initiatives Climate change is one of the most pressing challenges facing the world today, particularly Commonwealth island states, and poses significant risks to economic development. The recently launched Climate Finance Access Hub (CFAH) and Green Finance Facility are examples of Commonwealth initiatives designed to improve access to funding for climate mitigation and adaptation; this funding is particularly important for SVSs. The Commonwealth is also helping member countries unlock the value of the blue economy by promoting ocean governance. The CFAH is open to all Commonwealth member countries and, using a hub and spokes model, aims to help SVSs access international sources of climate finance to meet their priority adaptation and mitigation needs and realise their sustainable development goals. The assistance is delivered through climate finance experts who work in the beneficiary countries and regional organisations to build capacity for improved access and effective use of private and public climate finance resources. The Green Finance Facility was developed by the CWEIC in conjunction with the Commonwealth Secretariat and the International Sustainability Unit and unveiled at the 2015 CHOGM in Malta. The $1 billion facility will be capitalised initially through sovereign contributions and then through green bonds with the aim to improve the bankability of Green projects in Commonwealth countries, including SIDS. Relevant SDGs 13.A Implement the commitment undertaken by developed-country parties to the United Nations Framework Convention on Climate Change to a goal of mobilizing jointly $100 billion annually by 2020 from all sources to address the needs of developing countries in the context of meaningful mitigation actions and transparency on implementation and fully operationalize the Green Climate Fund through its capitalization as soon as possible Improve education, awareness-raising and human and institutional capacity on climate change mitigation, adaptation, impact reduction and early warning. Multilateral Initiatives aimed at promoting Green Growth The Environmental Goods Agreement A group of 18 participants representing 48 WTO members are engaged in plurilaterally negotiations to establish an Environmental Goods Agreement (EGA), which seeks to eliminate tariffs on a number of important environment-related products. Commonwealth member states party to the negotiations should seek to drive momentum to ensure a deal is reached as soon as practicable. Green Growth Knowledge Platform Established in 2012, the Green Growth Knowledge Platform (GGKP) is a partnership among the world's leading institutions and organisations active in areas related to green growth and green economy at the local, national and international levels. The GGKP identifies and addresses major knowledge gaps in green growth theory and 18

19 practice and encourages widespread collaboration and world-class research in order to offer practitioners and policymakers the guidance and resources they need to support the transition to a green economy. The Commonwealth is not currently a knowledge partner and could potentially benefit from the resources and networks the platform offers. The World Intellectual Property Organization (WIPO) GREEN WIPO, a UN specialized agency, seeks to play a role in informing policymakers and developing collaborative platforms that accelerate, encourage, and enable innovation and tech transfer. WIPO GREEN is an interactive marketplace that promotes innovation and the diffusion of green technologies. It does this by connecting technology and service providers as well as other facilitators with those seeking innovative solutions through both the WIPO GREEN online database and the WIPO GREEN Network. The online database features over 2000 green technology and service solutions from all around the world, as well as those seeking green tech solutions. The Network brings together experts, training opportunities, and other resources to help platform users commercialize technologies and complete deals. To enable greater green technology transfer, the Commonwealth, through the CWEIC, could actively encourage businesses in member states to utilise the platform. Relevant SDGs 7.A By 2030, enhance international cooperation to facilitate access to clean energy research and technology, including renewable energy, energy efficiency and advanced and cleaner fossil-fuel technology, and promote investment in energy infrastructure and clean energy technology. 8.4 Improve progressively, through 2030, global resource efficiency in consumption and production and endeavour to decouple economic growth from environmental degradation, in accordance with the 10-year framework of programmes on sustainable consumption and production, with developed countries taking the lead Promote the development, transfer, dissemination and diffusion of environmentally sound technologies to developing countries on favourable terms, including on concessional and preferential terms, as mutually agreed. Green growth - 10 Commonwealth Policy Priority Actions: Remove trade distortions hampering trade in green technology Continue to adequately fund the CFAH Increase institutional investors participation in establishing the Commonwealth Green Finance Facility Encourage CWEIC members to join business-to-business platforms that connect green technology providers and users, such as WIPO GREEN. 11. Aid for Trade 19

20 Aid for Trade (AfT) is about helping developing countries address their constraints to trade. It is a particularly effective form of aid with one dollar in AfT associated with an increase of nearly $8 in additional exports. 12 AfT supports countries to build capacities to trade and address adjustment costs when implementing trade agreements. It involves aid for economic infrastructure, regulatory reform, trade policy support or simply money transfers. The Global AfT Initiative was launched at the WTO Ministerial Conference in Hong Kong in 2005, where member states agreed to increase AfT, however clear targets were not set. The OECD and the WTO then established an AfT monitoring framework to help track progress in the implementation and enhance the credibility of the AfT Initiative. Since its inception, six monitoring exercises have been undertaken. At each biannual Global Review event, the OECD and WTO issue a joint flagship report called Aid for Trade at a Glance, which reports on the progress made. AfT facilitation is effective in reducing trading costs, and increased aid to economic infrastructure has a positive impact on export performance. Doubling AfT facilitation can decrease import costs by 5 per cent. These results are generally replicated both in African countries and small vulnerable economies. AfT is most effective when it addresses the most binding constraints, supports policies and institutions in recipient countries, and coordinates a range of actors. Doubling AfT can increase merchandise exports by on average 3.5 per cent, for example. By increasing their level of investment in Aft, Commonwealth developed country members can help promote sustainable economic growth and development. Relevant SDGs 8.A Increase Aid for Trade support for developing countries, in particular least developed countries, including through the Enhanced Integrated Framework for Trade-Related Technical Assistance to Least Developed Countries Also: Goals 2, 7, 9, 13, 14, & 15 contain relevant targets. Aid for Trade - 10 Commonwealth Policy Priority Actions: Increase AfT funding to developing countries, including for Trade Facilitation Agreement implementation. Produce baseline and commitments reporting on the Sustainable Development Goal targets pertaining to AfT as part of the World Trade Organization Trade Policy Review process for Commonwealth countries. 12. Commonwealth Trademark System Investing in and protecting intangible assets, such as a brand or trademark, can help promote economic development. Trademark protection is important because increasingly the value of goods is stored in the intangible rather than the tangible assets. Branding and licensing are two key tools that businesses across the 12 OECD/WTO Aid for Trade at a Glance OECD Publishing, Paris 20

21 Commonwealth can use to add value to their goods and services. This is especially key for developing counties as they move away from intermediate to final goods. Obtaining trademark protection in overseas markets can be costly and difficult, especially for small businesses. A unified Commonwealth trademark approach, through Commonwealth wide ratification of the World Intellectual Property Organization (WIPO) Madrid system, would be a low-cost, high-impact intellectual property solution that would allow any business, anywhere in the Commonwealth, to make a single application in its home country to obtain effective and efficient trademark protection across all 52 Commonwealth member economies. The WIPO Madrid System The Madrid System is a solution for registering and managing trademarks worldwide. Businesses are only required to file a single international application and pay one set of fees to apply for protection in up to 116 countries, which are party to the Madrid Union. 13 Members are able to modify, renew or expand their global trademark portfolio through one centralized system, which is convenient and cost effective. 19 Commonwealth countries are already members of the Madrid System. Commonwealth Trademark System - 10 Commonwealth Policy Priority Actions: Achieve Commonwealthwide ratification of the WIPO Madrid system by Trade Governance Trade and development policies require the coordination of multiple actors located in many countries. Historical, cultural and political ties among Commonwealth members facilitate this coordination. Coordination is also an opportunity to increase networks of cooperation and business among Commonwealth stakeholders and reject protectionism both amongst members and globally. In addition, this cooperation should follow up and review the mechanisms handled by Commonwealth countries to better deliver on the Sustainable Development Goals, in particular with regards to trade outcomes such as trade preferences and Aid for Trade. Trade and Investment Expo Holding a trade and investment expo alongside CHOGM would offer a unique opportunity to profile the goods and services businesses in the Commonwealth have to offer the world. This multi-stakeholder event could be themed according to a key area of interest/focus in the Commonwealth at the time. Allowing for networking opportunities among participants, providing exposure to new potential buyers and attracting media attention, the trade and investment expo would strengthen business ties and publicly highlight the Commonwealths strengths in trade. 13 The Madrid Union is made up of Contracting Parties to the Madrid Agreement and the Madrid Protocol. 21