Trade Briefing

Introduction - WTO - Poverty - Environment - Conclusion

Trade and Poverty

In 2001, developing countries accounted for 84.6% of the world's population [3]. The world population is set to grow from around 6.7 billion today to over 9 billion by 2050 [4]. World Bank estimates show that that 1.1 billion live on less than $1 per day, and 2.7 billion live on less than $2 per day [5]. 6000 children die every day through lack of clean water.

Developing countries are desperately poor and desperate for economic growth. Because of this, they will do just about anything to attract foreign investors into their country, particularly multinational corporations (MNCs). This usually involves introducing labour legislation which allows poor working conditions, exceptionally low wages, long working hours, no unions. In all aspects of production from agriculture to textiles, production costs have to be kept down to stay competitive, and wages are a major cost. The MNCs make vast profits, but invest little back into the host country, so the big corporations get richer the poor get poorer.

What effect does trade have on the environment?

References
3. Mackintosh, 2004, p36
4. www.un.org/popin/data.html
5. www.worldbank.org/data/wdi2004/pdfs/table2-1.pdf