Aiding Trading of Abetting? Designing Conflict-Sensitive Trade Policy
Publisher: International Institute for Sustainable Development and The World Conservation Union
Author(s): International Institute for Sustainable Development and The World Conservation Union
Date: 2006
Topics: Programming
Designing trade policies that diminish the likelihood or longevity of violent conflict is a critical task for the international community. In theory, trade can be a powerful driver of economic growth and stability: reducing poverty, creating non-military ways to resolve disputes and providing strong economic incentives for stability.
However, in practice, the current system of rules that govern international trade is fundamentally inequitable; biased towards rich countries and their corporations. Limited market access, complex regulations and perverse domestic subsidies in the developed world inhibit the efforts of developing countries to diversify their economies.
At the same time, developing countries are being pushed to adopt uncompromising market liberalization, which can reduce government revenues and undermine livelihoods, serving to increase the prospects for political instability and competition over scarce resources. This is especially the case in the absence of effective domestic institutions capable of mitigating economic shocks and satisfying competing demands for resources.