The development of services sectors in least developed countries (LDCs) has the potential to strongly support the achievement of sustainable development objectives including by increasing the involvement of small firms and by enhancing female participation.
Services are increasingly a critical ingredient in the functioning of value chains and also a vital component for enhancing intra-African trade. Given the importance of services in not only stimulating economic growth but also in terms of their ability to help governments address domestic development priorities from structural transformation to gender equality, addressing supply-side barriers is of vital importance. This session will highlight the sustainable development dimensions of services; examine the most pressing supply-side constraints faced by service sector firms in LDCs; and highlight potential solutions including regulatory evolution, targeted Aid for Trade interventions, and new investment approaches.
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The treatment of trade across the 2030 Agenda for Sustainable Development reflects the view that trade can, when well-regulated, contribute to growth and sustainable development.
In this respect, trade is not considered an end in itself but rather a means to support implementation. As we move forward, multilateral institutions like the WTO can play a critical role in implementing relevant trade-related targets under the Sustainable Development Goals (SDGs). The objective of this session is to review specific trade-related target and actions in the 2030 Sustainable Development Agenda and how WTO deliberations and negotiations can contribute to achieving progress in those SDGs. In doing so, it will discuss how the SDG framework can guide and inform current negotiations in the run up to the next ministerial Conference in Buenos Aires but also how such a framework can help set the agenda for future talks in the WTO.
The development of well-functioning and efficient services sectors is crucial to achieving structural transformation and sustainable and inclusive growth in LDCs and LICs. Furthermore, the global economy is undergoing a fundamental structural reformation driven by digital technology. Digital trade is, and will become, increasingly important for economies as digital services/e-commerce are increasingly directly traded as well as serving as crucial facilitating inputs into the production of other goods and services.
ICTSD’s work in support of the implementation of the WTO LDC Services Waiver, including the information obtained from case studies carried out in sixteen LDCs, suggested that one of the primary barriers to both domestic service sector development and services exports are regulatory aspects. There is a positive role for regulatory and policy development in economies in East Africa to significantly improve service sector and digital efficiency and competitiveness, leading to static and dynamic gains in the domestic economy, boost export performance and assist local firms to tap into global value chains (GVCs).
SMEs engaged in the services sector are subject to a number of challenges and barriers, however, rich opportunities exist for them to generate economic growth and to support social and economic inclusion in the region. Recent work, carried out by ICTSD and others, suggests that the share of female employment in service sectors is significant, women account for almost half of all service sector employment globally, and that, more importantly, female participation in service sectors in Africa is expanding rapidly. Mainstreaming gender into regulatory frameworks is crucial for not only reducing poverty, improving employments prospects, and raising living standards for millions of women in region but is also equally necessary to improve productivity and efficiency across the region.
There is a strong link between a higher concentration of economic activity in the services sector and higher rates of economic growth. Apart from playing a key role in generating economic growth, service sector development can also help address domestic development priorities ranging from structural transformation to gender equality and inclusive growth.
The development of well-functioning and efficient services sectors is critical to achieving structural transformation and sustainable and inclusive growth in Least Developed Countries (LDCs) and Low Income Countries (LICs).
Services have a catalytic role on sustainable social and economic development and serve as a means of addressing poverty, upgrading welfare, transforming economies, and improving universal availability and access to basic amenities.
Globally, services account for two-thirds of world employment, 60 percent of foreign direct investment flows and nearly half of world trade, measured on a value-added basis. There is a strong link between a higher concentration of economic activity in the services sector and higher rates of economic growth. The implementation of the LDC Services Waiver now underway in the WTO provides an additional incentive for further developing covered sectors in these countries.
With the huge untapped potential to develop services trade in LDCs and LICs to support and reinforce efforts to transform economies and generate inclusive and sustained growth; increased awareness, better understanding and enhanced capacity among relevant policy actors and other stakeholders would go a long way towards creating and sustaining the conditions under which this potential can be realized.