By Caroline Dommen*
March 11, 2021
The appointment of the first woman as WTO Director-General sends a strong signal that equality between men and women can be achieved. But if trade is to really empower women, the new WTO leadership must also engage with the harder questions about how trade can entrench or reduce structural gender imbalances in the economy, writes the author.
Dr Ngozi Okonjo-Iweala’s appointment as Director-General of the WTO has been widely welcomed, and with good reason, as she brings strong credentials to the role. Her appointment has been hailed as historical: she is the first African and the first woman to head the organisation. Trade and gender groups on social media resonated with comments like “at last” or “wooh! Historical,” decorated with emojis of applause, thumbs up, and different kinds of smiles.
Commentators, media outlets and Dr Okonjo-Iweala herself have highlighted the enormity of the tasks that lie ahead of her: rebuilding trust in a weakened institution, strengthening multilateralism and fixing the dispute settlement mechanism, not to mention addressing the coronavirus pandemic and its consequences. But one of the tasks that faces the new WTO head has scarcely been mentioned, even though it impacts over half the inhabitants of our planet: mainstreaming gender in the WTO’s work.
Improving gender balance amongst staff and delegates is but one step to redressing gender inequalities in trade
A survey of the gender balance in the WTO paints a sorry picture: key bodies have been chaired overwhelmingly by men throughout the organisation’s existence. Women have chaired less than ten percent of dispute settlement panels. Women have always been under-represented in WTO Secretariat leadership positions and over-represented in clerical roles.
So a woman D-G is a big step towards breaking the glass ceiling in this male-dominated organisation. The significance is amplified by the fact that now all three major global trade organisations in Geneva have women leaders: in addition to Dr Ngozi Okonjo-Iweala at the WTO we have Isabelle Durant at the helm of UNCTAD (since February) and Pamela Coke-Hamilton at ITC (since October 2020). As Durant rightly said earlier this week, seeing a woman succeed is an important step in tearing down gender barriers.
But gender balance amongst the people who make up the institutions responsible for trade is but one small aspect of the trade and gender relationship. More concerted work will be needed to address the gender inequalities that are so deeply entrenched in international trade. A crucial step would be for the WTO to join UNCTAD in acknowledging all sides of the relationship between trade and gender.
The two-way relationship between trade and gender
On the one hand, gender inequality impacts trade policy. Many countries have chosen to exploit women's labour—which is cheaper than men's—to develop their industrial and economic policies. Taiwan, Bangladesh or Lesotho are among the many countries that chose this path, largely keeping women in precarious working arrangements. These low value-added sectors of value chains and lowest-skill occupations are the tradable sectors where women are most present, such as call-centres, tourism or textiles. In other words, women’s lower-cost labour is used as a source of competitive advantage in international trade in labour-intensive sectors in which international competition is intense. Gender inequality thus becomes part of macroeconomic strategy.
Meanwhile, in all parts of the world, women-owned enterprises struggle to achieve competitive advantage in international trade: they tend to be concentrated in lower value-added industries or in sectors with lower export growth potential.
On the other side of the trade and gender relationship is the way in which trade and trade rules impact women differently from men. Trade and investment liberalisation can affect women disproportionately when consumption taxes are introduced to compensate for a loss in governmental income as a result of tariff cuts and loss of corporate taxes. Indeed, a standard policy prescription is to make up for the lost revenue by increasing indirect, consumption taxes (such as value-added or sales taxes), which often increases women’s tax burden more than men’s.
Conversely, liberalisation can impact women more positively than men, for instance in creating new jobs. This side of the trade and gender relationship is complex, and women will be impacted differently depending on where they live, where they work and how the goods and services that they consume are affected by liberalization.
Trade policy is not gender neutral…
Until recently, trade policy was largely understood as being gender neutral. It was commonly—and incorrectly—assumed that the effects of trade policies provided the same opportunities for men and women. In fact, during most of the WTO’s existence the organisation has been gender-blind, with those responsible for trade policy refusing to accept that differentiated—and sometimes negative—effects of trade for certain groups within countries was any concern of theirs. In recent years there has been a tentative move away from this position, and in 2017 the majority of WTO Members decided to create a mandate within the organisation to address trade’s impacts on women, by adopting the Buenos Aires Declaration on Trade and Women's Economic Empowerment.
… but the WTO risks sidestepping the main issues
Whilst it is positive that so many key WTO actors have acknowledged that trade is not gender-neutral and that the WTO should take on a role to address that fact, this Declaration sidesteps the key issues at stake. As its title indicates, it risks focusing WTO’s efforts solely on initiatives that enable women entrepreneurs to access international markets, without addressing the structural features of the international trading system that leave vulnerable people, many of whom are women, out in the cold.
For sure, providing funding and training to women entrepreneurs is easier than devising trade rules that enable developing countries to improve women’s working conditions and career opportunities whilst simultaneously maintaining their competitive advantage. Connecting women entrepreneurs to export markets is easier than assessing the complex ways in which a particular proposed trade measure could be beneficial or harmful for women in their roles as workers and consumers.
But if Dr Ngozi Okonjo-Iweala really wants to ensure that trade provides women equal opportunities with men and leave the historical legacy that women watching her on social media are hoping for, she will need to push Members, her staff and partner organisations to engage in earnest with the harder questions.
*Caroline Dommen is Independent Researcher and Associate at the International Institute for Sustainable Development
An earlier version of this article was published by the International Institute for Sustainable Development (IISD).