Remarks by Angel Gurría, OECD Secretary-General, G20 Leaders’ Summit
St. Petersburg, 6 September 2013
(As prepared for delivery)
Thank you Mr. President:
Trade and investment are a key source of growth and an area where the G20 can be credited with important achievements, such as the standstill and the rejection of protectionism, which have been supported, documented and monitored by the OECD, the WTO and UNCTAD.
Yet, in a context where the recovery is still proving extremely slow and uneven in advanced economies and with a slowdown in most emerging countries, more can and should be done on the trade front. Especially as trade is itself picking up only very slowly and is not generating – as it usually does – higher growth. Our latest data indicate that merchandise trade slowed in most major economies during the second quarter of 2013. Compared with the first quarter of 2013, the value of merchandise imports and exports for advanced and emerging members of the G20 decreased by 1.4% and 1.8%, respectively. In other words, growth in global trade is set to remain well below its long term average. [WTO forecasts: Projected trade growth of 3.3% in 2013, below the 20-year average of 5.3% and well below the pre-crisis trend of 6.0% (1990-2008)]
At this juncture therefore, further trade liberalisation can be a powerful, timely, non-debt stimulus to the world economy. And that is what Bali can potentially deliver. Trade facilitation is key: a 1% reduction in trade costs could potentially increase global income by USD 40 billion; reforms being negotiated today in the WTO could reduce trade costs by as much as 16% in some developing countries and 10% in advanced economies.
Regional initiatives and international regulatory cooperation are most welcome. Initiatives such as the Trans Pacific Partnership, the Transatlantic Trade and Investment Partnership negotiations, and the Pacific Alliance can be major breakthroughs in removing unnecessary burdens on firms and associated trade costs. We thus welcome the impetus given by the Russian Presidency to enhance transparency in Regional Trade Agreements.
With our economies being increasingly interconnected and goods and services crossing borders multiple times before reaching consumers, the evidence presented in our is compelling:
Count on our support, our analysis and our policy advice to transform international trade into the traditional engine of growth, jobs and well-being it has been in the past!