Posted by: mulrickillion | October 14, 2011

WTO | 2011 News items – DDG Singh: WTO is platform for raising competitiveness

WTO: 2011 NEWS ITEMS

3 October 2011

ECONOMIC RESEARCH AND ANALYSIS

DDG Singh: WTO is platform for raising competitiveness

Deputy Director-General Harsha V. Singh, in launching the WTO Chair at the Universitas Gadjah Mada in Yogyakarta, Indonesia on 3 October 2011, said that the WTO helps countries in their efforts to increase competitiveness “by keeping markets open, reducing arbitrary interventions, and augmenting available opportunities and capabilities”.

Professor Ir. Sudjarwadi, Rector of Universitas Gadjah Mada.  Mr. Riza Arfani, Executive Secretary of the Centre for World Studies. Distinguished guests and participants.  Selamat pagi.

Let me begin by saying that while the WTO system is one which provides the conditions to facilitate competitiveness,  there is no official WTO view on competitiveness and so what I offer are my own perspectives on the subject.  I will also discuss what the WTO, in its own way, is doing to increase the competitiveness of its members, in particular for its less developed members. 

Some general issue relating to competitiveness

First a few general issues in the context of competitiveness.

To understand competitiveness in its relevant context, we need to bear in mind that it is not an objective independent of its contribution to other more basic objectives such as growth of income, productive capacities and improved levels of well-being.  These are all dynamic concepts and therefore, competitiveness should be seen as creating enabling conditions to achieve these objectives through specific, positive and continued consistent efforts over time.

In broad terms, competitiveness is an ability to compete. If we search the internet for the definition for competitiveness, a common one would consider it in terms of the ability of a firm, sub-sector or a nation to compete.

Each of these entities, be they firms or nations, make efforts to enhance competitive ability.  At their own level, they take steps and establish systems which contribute towards increasing competitiveness.  That is an important context within which the multilateral trading system or the WTO becomes relevant.  More on this in a short while.

Competitiveness implies a willingness to engage and make efforts to gain grounds in an ever-changing world.  By its very nature, it does not imply that we build exclusive enclosures around ourselves.  In today’s world, such a policy is impossible to sustain.  Commercial enterprises as well as policy makers have to continuously build upon their competitive strengths.  In our interconnected world, this is an imperative for us all.

This interconnected world is also reflected in economic policy analysis.  Whether we consider microeconomics or macroeconomics, theories of development, finance or trade, the evolution of knowledge has involved an explicit recognition of the fact that people, firms or nations are not isolated entities. For example, policy makers today cannot conduct macroeconomic policies without taking account of the international sector. 

Due to the presence of such inter-linkages, stable, predictable and growing international opportunities have a far wider impact than just the direct positive benefits through international trade and investment.  This is because in several instances the effectiveness and efficiency of domestic policies, including the policy initiatives taken to improve competitiveness, are affected by the conditions prevailing in the international sector.  

Therefore, it is no surprise that nations have worked together to establish a system which provides stability, predictability and growth in international markets.  The WTO is precisely such a system, with its framework emphasizing   good governance, due process, transparency, credible dispute settlement and reducing arbitrariness in the area of international economic relations.   This was one of the reasons for Minister Pangestu in January this year at Davos to emphasise that there is no alternative to the multilateral trading system. . . .

WTO | 2011 News items – DDG Singh: WTO is platform for raising competitiveness

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