Content from the Brookings Institution India Center is now archived. After seven years of an impactful partnership, as of September 11, 2020, Brookings India is now the Centre for Social and Economic Progress, an independent public policy institution based in India.
We held a discussion on the World Development Report 2020 on “Trading for Development in the Age of Global Value Chains”. The report examines whether there is still a path to development through global value chains and trade.
The panel looked at India’slinkages, and the role of international fragmentation of goods production and service production in creating jobs & trade opportunities.
Global value chains (GVCs) powered the surge of international trade after 1990 and now account for almost half of all trade. This shift enabled an unprecedented economic convergence: poor countries grew rapidly and began to catch up with richer countries. Since the 2008 global financial crisis, however, the growth of trade has been sluggish and the expansion of GVCs has stalled. Meanwhile, serious threats have emerged to the model of trade-led growth. New technologies could draw production closer to the consumer and reduce the demand for labour. Further, conflicts among large countries could lead to a retrenchment or a segmentation of GVCs. The World Development Report concludes that GVCs can continue to boost growth, create better jobs, and reduce poverty provided that developing countries implement deeper reforms to promote GVC participation, industrial countries pursue open, predictable policies, and all countries revive multilateral cooperation.
Dr. Aaditya Mattoo is Chief Economist of the East Asia and Pacific Region of the World Bank. He specializes in development, trade and international cooperation, and provides policy advice to governments. Previously, Mr. Mattoo was an Economic Counsellor at the World Trade Organization.
Dr. Harsha Vardhana Singh, a Senior Fellow, Council on Emerging Market Enterprises at the Fletcher School of Law and Diplomacy, is an expert on international trade policy, development, infrastructure regulation and global governance. He has also served as the Deputy Director-General at World Trade Organization.
Dr. Amita Batra is a Professor of Economics at the Jawaharlal Nehru University. Previously, she worked as a Senior Fellow at ICRIER and has had stints with the Hindu College, World Bank and IIM-A. Her areas of interest are International Trade and Finance and Regional Economic Integration with a special focus on South Asia.
Rajesh Chadha is Program Director, (Natural Resources). He was formerly a Professor & Research Director at NCAER.
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[As the Fed and other major central banks begin raising rates, some emerging market central banks would be forced to follow suit. Otherwise, capital would flee and their currencies would plunge in value, further aggravating inflation.] You could have a crisis if investors all decide to run for the exits at the same time.