Davos WEF
Davos WEF

Trade has become the scapegoat for the world’s problems: ITC

Trade has been overwhelmingly good for the US: International Trade Center

"Trade is becoming the lightning rod for every problem that every country has on earth", but we must stop viewing it in isolation, the executive director of the International Trade Center has urged.

In an impassioned interview with CNBC at the World Economic Forum in Davos, Arancha González claimed that trade had become the scapegoat for global divisions and economic inequality but said more attention should be paid to the role of domestic policies.

"I think the problem we have in some developed countries is that trade opening, which has been generally good, has not been accompanied by the right domestic policies," she said, listing retraining, skills, education, infrastructure and suitable taxation policies amongst these.

"For every two jobs lost to trade, eight are lost to technology."

She added that trade was responsible for lifting one billion people out of poverty and asked "which people are going to say trade is not good?"

González's comments come ahead of the as the 45th President of the U.S. later today. He has famously spoken of the failures of multilateral trade agreements and has said he plans to withdraw from the Trans-Pacific Partnership on his first day in office.

"I worry that in today's world that we go from a rules-based trading system to a deals-based trading system. I think for all countries around the world, especially those – at least two-thirds of them – that are smaller in size, weaker in power, a deals-based system is no good," González said.

"For smaller countries it's going to be tough to go bilateral. This is why what we have to do is reinforce the rules-based multilateral trading system. The one where everybody has a seat and everybody wins.

"Trade is win-win; it's not a zero-sum game. For trade to work, let's make this clear once and for all, it's not only trade; it's domestic policies that need to be synchronized with trade opening. If these trade policies are not accompanied by good, sophisticated, solid, domestic safety nets, trade will be the lightening rod.

Of the U.K.'s , González said it was in both parties interests to ensure stable, solid relations, given the number of businesses that have fragmented their production across the union.

The ITC is a subsidiary organization of the United Nations Conference on Trade and Development and the World Trade Organization, which assists developing economies promote their exports. It provides technical assistance in trade-related matters, particularly with regards to helping developing counties promote their exports.

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