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Ahead of the now postponed 12th Ministerial Conference of the World Trade Organization (WTO), member countries are considering how to advance the still incomplete agenda on gender and trade. The evidence is increasingly clear that while the international trade architecture itself is embedded with the principle of non-discrimination, the benefits of trade are not equally distributed across gender lines. WTO negotiators should take concrete steps to ensure trade policies positively impact women – as consumers, entrepreneurs, producers, suppliers and workers.
We believe there are five reasons why the time to act on gender and trade is now.
In order for societies to recover from the economic impacts of COVID-19, we need to engage all businesses and workers to restart our economies. Women make up half the world’s population but only constituted 39% of the labour force in 2019. Women have also been disproportionately impacted by the pandemic and ensuing crisis in terms of unemployment and business closures. As economies recover, governments should not lose focus on the specific needs of women entrepreneurs, producers and workers when providing financial incentives and other means to restart businesses.
The WTO, and its members, should acknowledge these conditions by specifically looking at how trade can help women entrepreneurs, producers and workers create economic opportunities and, in particular, what can be done to help make micro, small, and medium sized enterprises (MSMEs) export ready.
The COVID-19 pandemic exposed the fragility of certain supply chains, demonstrating the need for governments and companies to diversify their suppliers. Public procurement markets represent an enormous opportunity for governments to build resiliency within supply chains while supporting women entrepreneurs and producers. The stakes are high – governments spent $11 trillion or 12% of global GDP on buying goods and services in 2018 and up to 30-40% in some least developed countries.
Currently, women take advantage of only a small share of public procurement opportunities globally, with women-owned businesses estimated to account for 1% of public procurement. This is often due to barriers related to access to information, pre-qualification, tendering, contract administration and debriefing, and relationship management.
Boosting women’s participation in procurement opportunities is smart economics, creating opportunities for more diverse competition. Organizations like the International Trade Centre (ITC) support women in this regard with online tools, e-learning materials, publications, and step-by-step guides for policymakers and other stakeholders. The stage is set for the WTO to encourage greater opportunities for women entrepreneurs and producers in this space. In addition, WTO members can learn from the private sector, where many large multinationals have successful supplier diversity programmes that have helped them reach new markets while returning value to shareholders.
The COVID-19 pandemic has challenged the relevance of brick-and-mortar business models. It has accelerated the need for businesses to digitalize to survive and be resilient to economic shocks. In fact, according to some estimates, 60% of global GDP will be digitalized by 2022.
Digitalization can unlock massive opportunities for women entrepreneurs through seamless access to new markets and greater efficiencies for their businesses – but these benefits only accrue to those who are digitally enabled. The trade rules in this space are antiquated, and countries are negotiating new rules under the E-commerce Joint Statement Initiative. Capacity building for women entrepreneurs that recognizes women and men may have different digital needs is critical, especially in developing countries where the digital divide is often largest.
The ITC’s SheTrades programme offers a great example of how this can work at scale. SheTrades has trained over 40,000 women entrepreneurs through a free and unique platform to connect, learn, and do business. Through the SheTrades Virtual Learning Space, users can access over 120 modules, including courses led by industry experts from government, the private sector and trade and professional associations. For example, through its partnership with SheTrades, UPS has trained thousands of women on how to expand their exports. The WTO and its member countries should continue to support these capacity building efforts that can increase women’s opportunities in digital trade.
We continue to have a knowledge gap on gender and trade because trade data is seldom disaggregated by gender. We need to do better so we can properly assess the current state of women-owned businesses and workers that are participating in global trade.
Recent advances in sex-disaggregated data collection have been critical to advance a more gender-neutral trade policy. For instance, a recent Cambridge University study found that different tariffs on women’s clothing and men’s clothing result in penalties on women consumers. Faster progress in data collection will help us identify and develop more targeted solutions to the problems women are experiencing. To date, 47 countries have joined SheTrades Outlook to diagnose and address gaps in inclusive policy-making.
Even where governments have not undertaken international commitments, tangible progress can be made on the ground. For instance, India has not officially endorsed the Buenos Aires Declaration on Trade and Women’s Economic Empowerment, but it is taking steps to mainstream gender in its trade facilitation plan and has set a target to make land ports gender friendly in three years. Gender-sensitive trade infrastructure, which focuses on improvements such as security, has been shown to encourage women to trade cross-border through formal channels, help prevent harassment, and reduce opportunities for corruption.
With the rescheduling of the WTO Ministerial Conference, there is an important opportunity for member countries to keep up the momentum and work towards making a lasting impact on how the international trade architecture nurtures and supports women traders. The economics are clear that supporting women traders is good for countries and good for the global economic recovery.
What is the World Economic Forum doing about digital trade?
The Fourth Industrial Revolution – driven by rapid technological change and digitalization – has already had a profound impact on global trade, economic growth and social progress. Cross-border e-commerce has generated trillions of dollars in economic activity continues to accelerate and the ability of data to move across borders underpins new business models, boosting global GDP by 10% in the last decade alone.
The application of emerging technologies in trade looks to increase efficiency and inclusivity in global trade by enabling more small and medium enterprises (SMEs) to repeat its benefits and by closing the economic gap between developed and developing countries.
However, digital trade barriers including outdated regulations and fragmented governance of emerging technologies could potentially hamper these gains. We are leading the charge to apply 4IR technologies to make international trade more inclusive and efficient, ranging from enabling e-commerce and digital payments to designing norms and trade policies around emerging technologies (‘TradeTech’).
Penelope Naas, President, International Public Affairs and Sustainability, UPS
Pamela Coke-Hamilton, Executive Director, International Trade Centre (ITC)
Nisha Taneja, Professor, Indian Council for Research on International Economic Relations (ICRIER)
The views expressed in this article are those of the author alone and not the World Economic Forum.
Predictions the pandemic would spell the end of globalization have proved wide of the mark. In fact, it appears global trade of goods has recovered.
The WTO must ensure trade policies help women disproportionally affected by COVID-19. Creating opportunities for women can aid global economic recovery.
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