The document discusses arguments around free trade agreements and their impact on developing countries. It notes that while free trade may benefit those integrated into global markets, it can negatively impact domestic industries and only reduces poverty if new jobs are created. Evidence shows trade liberalization initially increases income inequality. Regional trade agreements are being pursued in the absence of World Trade Organization progress, but developing countries lack the capacity to address non-tariff barriers and other issues. The document calls for greater representation of "voiceless" groups in trade negotiations and policies.

1. FTAs, Regional Blocks and Equity – who will
represent the voiceless in trade

2. Arguments around Free Trade
Against
1. Only a specific class of people can take advantage of free
trade – those already globally integrated (includes rich
and poor).
2. Those industries which are producing domestically
demanded goods face a shutdown.
Favour
1. Why go through the traditional structural
transformation?
2. Service-led growth is also labour intensive
2

3. Evidence from Developing Countries
• Trade only reduces poverty if there is job
creation
• Trade liberalization in the initial phases leads
to increased income inequalities
3

4. Situation Analysis
• Curtailing trade is not a choice
• Consumer demand forces informal trade if
formal channels are closed
4

5. Regionalism and FTAs
• FTAs being signed in the absence of progress on WTO
• Criticism by business community
– Governments started negotiating without taking
businesses on board
– Industry concerns beyond market access including
investment and services should be incorporated
– Involve businesses in the annual review of FTAs
• What about other voices?
– Consumer groups in developing countries lack capacity
5

6. How FTAs impact voiceless
•
•
•
•
Negotiating non-tariff barriers is difficult
Hidden subsidies are not easy to recognize
Countering undervalued imports is difficult
Developing countries will require assistance in
complying with trade regulations
• Dispute settlement arrangements and
compensatory mechanism
6

7. Where is the trade-related infrastructure?
Afghanistan
Bhutan
Bangladesh
India
Pakistan
Maldives
Sri Lanka
Nepal
Efficiency of
customs clearance
process
2.33
2.29
2.33
2.77
2.85
2.24
2.58
2.20
Note: (1=low to 5=high)
Source: World Development Indicators 2013
Quality of trade and
transport-related
infrastructure
2.0
2.3
2.49
2.87
2.69
2.47
2.5
1.87
Competence and
quality of logistics
services
2.16
2.42
2.44
3.14
2.77
2.68
2.8
2.12

8. Way Forward
• Who will represent the voiceless in trade?
– Government
– Private Sector
– Civil Society Organizations
– Community Boards
• We still don’t have an answer
8