UNCTAD - INTERNATIONAL
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News: Trade and Development Report
Update (April 2024)
What's in the news?
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According to a report by the United Nations Conference
on Trade and Development (UNCTAD), India’s trade reliance on China and the
European Union is rising as global trade is witnessing a marked shift along
geopolitical lines.
Key takeaways from the
Report:
1. Supply Chain Reset:
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This comes in the backdrop of major supply chain
reset following the pandemic and the
Russia-Ukraine war that had sent food and fuel prices to record highs.
2. UNCTAD Report
Estimates Based on National Statistics:
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India’s dependence on China and the European Union (EU) grew by 1.2 percent
while its reliance on Saudi Arabia slid by 0.6 percent.
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This came despite India’s efforts to cut reliance
on China by implementing its flagship Production-Linked Incentive (PLI) scheme
and Quality Control Orders (QCOs) largely to limit entry of cheap Chinese
products.
3. Shifting Trade
Pattern:
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UNCTAD’s estimates showed a major shift in trade
due to the ongoing Russia-Ukraine war.
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While Russia’s
trade dependence on China surged by a record 7.1 percent, its reliance on
the EU decreased by 5.3 percent. This was largely due to Russian oil shifting
from the EU to China and India.
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The US cut reliance on China by 1.2 percent in 2023
and increased its trade dependence on the EU and Mexico.
4. Decline in Global
Trade:
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The report showed that global trade declined in
most sectors, except for
pharmaceuticals, transportation equipment, and road vehicles, particularly,
electric cars.
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Among the sectors where the value of trade declined
by more than 10 percent during 2023 are apparel, chemicals, energy metals,
office equipment, and textiles.
5. Decline in Global
Merchandise Trade:
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The value of global merchandise trade has
experienced continuous decline since mid-2022.
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Trade in goods is expected to contract by about US$
1.3 trillion or 5 percent in 2023
but services trade is expected to gain
about $500 billion, or 8%.
Go back to basics:
United Nations
Conference on Trade and Development (UNCTAD):
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It is the UN’s leading institution dealing with
trade and development.
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It is a
permanent intergovernmental body established by the United Nations General
Assembly in 1964.
Headquarters - Geneva, Switzerland.
Members – 195 nations (including India).
Structure:
1. UNCTAD Conference:
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Highest policy-making body of UNCTAD which meets once every 4 years.
2. Trade and Development
Board:
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UNCTAD’s executive
body which is responsible for the operations of the organization when the
Conference is not in session.
3. UNCTAD Secretariat:
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Performs policy
analysis, monitors and implements the decisions of UNCTAD’s
intergovernmental bodies, and provides for technical cooperation.
Features:
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It supports developing countries to access the
benefits of a globalised economy more fairly and effectively.
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It provides economic and trade analysis,
facilitates consensus-building and offers technical assistance to help
developing countries use trade, investment, finance, and technology for
inclusive and sustainable development.
Reports published by the
UNCTAD:
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Trade and Development Report
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World Investment Report
● The Least Developed Countries Report