Canada is successfully positioning itself as a champion of progressive trade measures, by highlighting the economic benefits of trade deals that are more inclusive of minority groups, such as women and micro businesses.
Progressive trade is widely regarded as the legacy of a World Trade Organization (WTO) ministerial conference held last December in Buenos Aires. It was there country representatives signed the Joint Declaration on Trade and Women’s Economic Empowerment. Canadian Trade Minister Francois-Philippe Champagne and his delegation took a leading role.
Alongside traditional subjects such as agricultural and fisheries, the minister and his delegation made a point of presenting gender, e-commerce and micro, small and medium-sized enterprises (MSMEs) as key topics of discussion.
These progressive trade agenda items were at the forefront of a talk by Stephen de Boer, Canada’s ambassador and permanent representative to the WTO. The Ottawa event, sponsored by the Centre for International Governance Innovation took place just days before U.S. President Donald Trump confirmed he was imposing tariffs on Canadian steel and aluminum. The WTO is now dealing with formal requests from Canada and the EU for dispute consultations on the matter.
Empowering women in trade is good for the economy
Promoting women in trade isn’t just good political optics, says de Boer. Greater participation of women in international business is also good for the economy.
But women aren’t always finding the opportunities they need when growing their businesses internationally. The ambassador cites studies on women-owned businesses, showing they are less likely to trade outside of their own countries, and that they report burdensome procedural obstacles more often than men-owned enterprises.
In some countries, it’s still difficult for women to own property, start businesses or enter certain professions, creating further barriers to international trade, notes de Boer.
“These legal gender differences significantly decrease female labour force participation and undermine GDP growth,” he says. “A 2015 McKinsey study found that advancing women’s equality could add $150 billion to Canada’s annual GDP growth and add $12 trillion to the global GDP by 2025.”
Canada incorporated a chapter on gender into the Canada-Chile free trade agreement renegotiated last year. Canada’s recent trade agreement with a number of countries bordering on the Pacific ocean, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), also contains targeted gender provisions, something de Boer says Canada will continue to foster.
The declaration, championed by Canada at Buenos Aires and signed by 120 of 164 member states, affirms an interest in advancing women’s empowerment through economic policy and sets out collaboration to be undertaken among participating WTO members.
“Trade rules may be gender neutral, but through the declaration, we’ll ensure they’re not gender blind,” says de Boer. “We think the declaration is one of the great successes of MC11.”
Boosting micro and small business trade
WTO members also examined how to better integrate micro, small and medium-sized enterprises (MSMEs) into international trade. A group of 88 members, including Canada, agreed to launch an informal work program to address this question.
With a rules-based, stable trading system, the WTO already levels the playing field for small players that may not have access to vast resources, says de Boer. But he says more can be done.
“Small businesses are the backbone of Canada’s economy and most economies around the world, but the trade data show they don’t trade as much as larger companies.”
The work program will allow members to discuss measures that will help small firms trade, such as facilitation, predictable regulatory environments, better access to financing and information on trade requirements.
E-commerce creates equal opportunity
Canada wants the WTO to consider new rules that would encourage e-commerce as a means of more inclusive economic growth.
“We believe e-commerce presents new opportunities to connect rural to urban economies, facilitate the participation of women in the formal economy and provide MSMEs access to a global consumer base at reduced overhead costs through cloud-based solutions,” de Boer says.
“We want to use the WTO’s rule-based system to help create the conditions to achieve those benefits. At a minimum, the WTO should be able to put in place standards of good practice that will facilitate the use of e-commerce.”
Canada joined a group of 63 members to launch work on prospective negotiations.
The push for more progressive trade comes at a time when the WTO faces challenges. But de Boer remains optimistic that, despite some setbacks, progressive trade measures will stay top-of-mind for the majority of member countries.