TRADE POLICY IN EASTERN EUROPE – WHY GENDER MATTERS #DevTalks

Trade-and-Gender Impacts of AA/DCFTAs: Key Findings Andrea Spear Stockholm, 26 April 2016

Report Objectives EU Association Agreements and Deep and Comprehensive Free Trade Areas with Georgia, Moldova and Ukraine = AA/DCFTAs in this presentation Objectives: to analyse how women and men are likely to be affected by the implementation of the AA/DCFTAs; and to provide recommendations for Sida on possible actions to maximise the benefits and minimise any gender inequalities arising from these agreements.

Five-Dimension Analysis 1.Production/employment effects 2.Supply-side effects 3.Consumption effects 4.Revenue effects 5.Regulatory effects

Tariff cuts are no longer the main issue AA/DCFTAs = Change Management Agenda 21 st Century trade agreements seek: greater harmonisation of laws, regulations (legal predictability, rule of law) good practices (eg, transparency, anti-corruption, pro-competitive environment, anti-discrimination) changes in attitudes and mindsets.

Potential long-term benefits of AA/DCFTAs – IF they are fully implemented Strong trade expansion 2-5% extra GDP growth 1% reduction in consumer prices 1,5-6% wage increases Safer, more competitive products New business opportunities and market diversification. A more modern and effective legal and regulatory environment Fairer competition; enhanced consumer protection and product safety; reduced corruption; stronger intellectual property rights, and a harmonised approach to labour rights and practices, environmental and energy issues, human rights, gender equality, etc. Better business environment due to much stronger measures to address unfair competition and corruption through improved transparency, competition policy, government procurement, etc. A more efficient and accountable public sector, due to institutional/structural reforms with support and monitoring by EU members and international organisations. More efficient, accountable spending by central and local governments due to strict accountability rules and increased transparency for public tenders.

Potential trade-and-gender beneficial effects Good export and investment prospects for niche segments of agrifood, textiles/clothing, metals, machinery and electrical equipment, chemicals and services. Women constitute a large percentage of employees in promising areas. Women and men with the necessary skills will benefit. Greater formalisation should have beneficial flow-on impacts on wages, taxes, social coverage, etc. SMEs are likely to benefit the most if they can surmount competitive pressures. Female entrepreneurs may benefit more and provide greater impact if inequalities are addressed.

Challenges for SMEs in taking advantage of DCFTA opportunities Skills shortages Corruption Access to Quality Infrastructure (SPS/TBT) Reliable electricity Credit and finance Construction permits Trading across borders (trade facilitation) Product and market information Technology and expertise

Quality Infrastructure - a key competitiveness issue System for implementing, enforcing and certifying compliance with: sanitary and phytosanitary (SPS) food safety, hygiene, traceability, etc, requirements (in line with the WTO SPS Agreement), and technical regulations and standards applying to processed and manufactured items, including production processes, safety, composition, metrology, labelling, packaging, quality management, etc (in line with the WTO Technical Barriers to Trade – TBT - Agreement). eg, Accreditation agencies, accredited laboratories and other testing facilities, accredited conformity assessment bodies, standards and metrology bureaux, food safety system, etc

Effects of DCFTAs that may worsen gender inequalities Certain segments of food, apparel, vehicles, machinery, chemicals, plastics, building materials, consumer goods may face challenges. Some uncompetitive segments may close. 3-5% of labour force may have to find work in a new sector. Low-skilled, less-educated people will be the most disadvantaged. Some food items may become more expensive due to stricter quality norms. Implementing the Approximation agenda and structural adjustment, while simultaneously dealing with conflicts, may limit resources for social spending. Given existing inequalities, women entrepreneurs might be left behind in the battle for competitiveness.

Inequalities mean women entrepreneurs face greater challenges than men...in access to: land credit basic infrastructure quality infrastructure market and product information technology skills technical support business networks.

Overview of Main Recommendations The recommendations address the main ‘drivers of change’ and actions to facilitate: responsible government competitive SMEs Support mechanisms (for enhancement of gender equality) the three themes of today’s conference.

Overview of Recommendations cont. The top priority is to support implementation of the Approximation agenda; it is the most likely to lead to sustainable benefits for all. The second priority is to support effective management of structural adjustment and competitiveness issues. Of equal importance are early actions to: identify and mitigate the social costs that result from the adjustment process, and To provide ongoing support to reduce gender inequalities.

How it all fits together Themes of ConferenceRecommendationsDrivers of Change Responsible government Approximation agenda Structural adjustment Mitigating social costs Reforms (AA/DCFTAs, WTO, intl conventions) international pressure Competitive SMEsStructural adjustment Competitiveness issues, Access to resources Sectoral resource allocations (eg, labour mobility) Entrepreneurship Support mechanisms (for enhancement of gender equality) Support issues included in all of the above + a number of other gender inequality issues Changes in societal attitudes. Civil society, women’s organisations, academia, labour unions, media, etc