Globalisation:Bangladesh

Unlocking the Benefits of Trade for Poor People

One of Adam Smith International’s main areas of interest is in the potential for international trade to have a tangible, positive impact upon poverty reduction.

In January 2004, ASI hosted a major international conference in Dhaka, Bangladesh, aimed at boosting poverty reduction in the southern Asia region through progressive trade measures.

The conference, organised in conjunction with the local DFID office, brought together development professionals from the donor community, government officials, representatives of NGOs and expert consultants from across the Indian subcontinent and South-East Asia. This forum was intended to encourage the exchange of ideas and experiences from across the region and lead to the formation of some level of consensus as to future policy direction.

The main focus of discussions was on the link between trade and poverty reduction. The core hypothesis - that trade can be used as a tool to improve the lives of the poor - was explored in detail in an attempt to uncover evidence and causality. Particular attention was paid to environmental, social and gender issues as well as broader poverty alleviation.

The possible benefits of a South Asia Free Trade Area (SAFTA) were discussed at length, as was the forthcoming repeal of the highly restrictive Multi-Fibre Arrangement, which currently prevents fair access to western markets for Asian textiles manufacturers.

Some of the key findings of the conference were as follows:

• Trade reform must be addressed from a poverty reduction perspective
• Trade reform must be linked to domestic policy reform if the poor are to benefit
• Any negative impact of trade reform must be addressed
• Market access policy must be participatory, pragmatic and realistic
• Service sector growth offers the greatest employment growth prospects, but can lead to casualisation and internal migration, with significant social implications
• Regional integration could be a driver for increased trade, with the potential for inter-linked production and a larger international focus on the region. However, this comes with some political risk
• Significant effort must be made to gather data on the current trade status and the impact of reform
• The role of donors and the best way of co-ordinating their efforts, needs to be examined