Post 2015: Global Action for an Inclusive and Sustainable Future

the role for trade and investment policies in fostering
inclusive and sustainable development.
Drawing on historical and contemporary
experiences of economic development, this chapter
has argued for gearing trade and investment policies
towards achieving structural transformation of the
economy in lIcs and lDcs. While the majority of
people living in poverty are likely to be in mIcs,
the chapter has focused on lIcs and lDcs because
institutions in such countries are weaker, their
production base smaller, their range of exports
limited, and they lack connections to global markets.
In addition, a higher proportion of the population of
lIcs live in poverty than is the case in mIcs. From
the perspective of trade, the chapter has shown that
most lIcs and lDcs are dependent on exporting
commodities, which renders them vulnerable to
global price cycles. For this reason, the chapter has
called for help for lIcs and lDcs to expand their
production base and diversify their trade portfolio.
In keeping with the focus of this report on what
global development framework would best enable
lIcs and lDcs to achieve their development
objectives, this chapter proposes a number of
elements on trade and investment for a post-2015
global development agenda. these include:
(1) Promoting modern-sector exports, for instance
by increasing the breadth and depth of preferences
(e.g. reforms to roo to allow lIcs and lDcs to
participate in Gvcs); by providing support to
increase their ability to meet non-tariff barriers
such as sanitary and phytosanitary standards;
and by continuing policy dialogue on domestic
regulatory frameworks with lIcs and lDcs.
(2) Reducing vulnerabilities to external shocks
through targeted measures, including
innovative schemes to reduce excessive price
volatility in world commodity exchanges and
contingent facilities for mitigating income
shocks from such volatility. there is also a need
to develop more effective and responsive global
facilities to prevent and absorb shocks.
(3) Enhancing productive investments: aft
should be used to help lIcs and lDcs
address trade-related binding constraints and
increase productive capacity. there is also a
need to increase investment in inclusive and
sustainable development, which could be done
by incentivising investment in lIcs and lDcs,
integrating investment policy in development
strategies, and incorporating sustainable
development objectives in investment policy.
(4) Improving global coordination on investment
policies: the current investment policy
environment is highly fragmented, and there
are insufficient linkages between investment
policies and trade, environmental, or financial
policies. there is a need to create a more
coordinated investment policy system as well
as enhancing coordination between investment
policy and other policy areas, such as financial
crises, food security and climate change.
these are broad elements to which the global
community could positively contribute. the
chapter has highlighted elements in which the Eu
in particular as the world’s largest trading block
could do more and/or better, though other global
traders will also have to do their share. against
the backdrop of the changing landscape of trade
and investment flows and especially the growth
of South-South trade, the Eu will continue to be
an important player, but there will be other nontraditional
actors as well who will influence and
shape the new landscape. What forms of cooperation
emerge will have important implications for poor,
developing economies. the chapter has sought
to present the contours and the elements of what
would most help lDcs and lIcs enter into a
dynamic process of structural transformation and
economic development and that could be integrated
into into a post-2015 framework.
poSt-2015: Global actIon For an IncluSIvE anD SuStaInablE FuturE
Against the
backdrop of the
changing
landscape of trade
and investment
flows and
especially the
growth of South-
South trade, the
EU will continue
to be an
important player,
but there will be
other nontraditional
actors
as well who will
influence and
shape the new
landscape. What
forms of
cooperation
emerge will have
important
implications for
poor, developing
economies.
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