Jason Furman, Professor of Economic Policy at Harvard University, emphasized that globalization over the past 25 years has significantly improved human welfare. Despite a global population increase of two billion, more than one billion people have been lifted out of extreme poverty, leading to a 70% reduction in poverty worldwide. Key human development indicators like life expectancy, maternal mortality, and literacy have also seen remarkable gains. Mr. Furman attributed these improvements to economic globalization, including the movement of goods, services, capital, people, and ideas across borders.
However, he noted the paradox that despite these achievements, globalization faces increasing skepticism and political resistance. Mr. Furman pointed out that the growing backlash against globalization stems from widespread misconceptions about its effects, including that it only benefits a few while leaving the majority behind. This notion overlooks the role globalization has played in reducing global inequality between 2000 and 2020. Countries like China and India embraced global trade and saw tremendous economic growth while those distancing themselves from globalization largely missed out.
Another misunderstanding is the belief that trade is fundamentally different from technological innovation. Mr. Furman used an analogy: “Imagine we invented a machine that turns soybeans into cars. Trade operates similarly — you ship soybeans to one country, and in return, you receive cars.” This process mirrors the benefits of technological advancements which people generally accept — yet trade is often viewed with suspicion.
Mr. Furman also addressed misconceptions surrounding tariffs as a way to protect domestic industries from foreign competition. In reality, tariffs raise domestic prices and harm consumers. “Tariffs are paid by your own consumers,” Mr. Furman emphasized.
Professor Furman said this trend has intensified especially in developed countries due to factors such as rising inequality, concerns over immigration, and fears about supply chain vulnerabilities which have fueled protectionist sentiments.
He noted the remarkable resilience trade has shown in difficult times: “I have been hearing about the end of globalization for pretty much my entire career...globalization is a lot more like a dandelion than it is like an orchid; dandelions can thrive no matter what you throw at them.”
Looking forward, Mr. Furman underlined the need to defend global trade while ensuring its benefits are more widely shared through fostering greater plurilateralism where agreements are made between groups of countries encouraging others to join over time.
“We need to create agreements that encourage other countries to follow,” he suggested.
DG Okonjo-Iweala underscored that Mr. Furman's insights align with recent WTO reports emphasizing how globalization has delivered positive outcomes but not benefited everyone equally.
“It’s amazing that some who have not benefited still believe in it,” DG Okonjo-Iweala said.
She emphasized significant challenges due to recent shocks like COVID-19 pandemic and geopolitical shifts exposing supply chain vulnerabilities but noted trade's resilience helping sustain the global economy.
“There is absolutely no doubt that trade is facing challenging times,” she said.
The morning session of Day 2 featured discussions on successes and shortcomings as WTO turns 30 years old addressing challenges including reforming dispute settlement system and giving new momentum to negotiations.
Indonesia's former Minister of Trade Mari Pangestu emphasized WTO's role in empowering developing countries citing cohesive groups like G20 and G33 noting: “Trade is a means to development...you need complementary policies.”
Scott Lincicome countered pessimism noting significant growth despite geopolitical challenges with 75% world trade conducted under WTO rules adding governments' support for WTO system continues through multilateral or plurilateral agreements.
Robert Howse acknowledged decline of neoliberalism stressing adaptation needed for new power dynamics using institutional human capital making trade improve lives benefiting marginalized groups.
Federico Banos-Lindner stressed crucial role effective governance plays without which "we will have tariffs...quotas...trade barriers."
Dr Bright Okogu highlighted outcomes achieved at MC13 including progress on needs of developing/LDCs extension e-commerce moratorium accession two new members Comoros Timor-Leste noting dispute settlement system remains active needing rejuvenation but functional.
A high-level session discussed improving agricultural trade ensuring inclusivity moderated by Cecilia Malmström featuring Beth Bechdol Inu Manak Diana Mondino Andrea Porro discussing policies needed building progressive inclusive sustainable sector addressing conflicts climate crises food security importance farmers' inclusion.
A session dedicated digital trade disability inclusiveness marked first joint activity between WTO UN ITC ILO aiming assist governments integrate enhance disability inclusion advocating within agreements policies regulations moderated by Angela Ellard speakers noted potential influence national governments' ability address barriers leveraging digital technologies fostering inclusive employment practices realizing decent working conditions adequate skills for all.