- GÜLER SABANCI MADE THE OPENING SPEECH OF 21ST CENTURY TRADE: CHALLENGES, SOLUTIONS AND REQUESTS PANEL
- GÜLER SABANCI: "THE REMEDY FOR THE INACTIVITY AND SLOWING GROWTH AROUND THE WORLD IS TO INCREASE TRADE"
- "INCLUDING PARTICULARLY G20 COUNTRIES, ALL COUNTRIES SHOULD CARRY THE AGREEMENT FOR SIMPLIFYING TRADE INTO EFFECT"
- "THE MOST IMPORTANT MISSION OF B20 IS TO PUT LEVERAGE ON G20 GOVERNMENTS FOR IMPLEMENTING"
- "ADDITIONAL 2% GROWTH SHALL BE OCCURED AROUND THE WORLD THANKS TO THE AGREEMENT FOR SIMPLIFYING TRADE."
- BEFORE HER SPEECH, GÜLER SABANCI MET UP WITH CHRISTINE LAGARDE, PRESIDENT OF IMF
B20 (Business 20) Turkey Conference, which is representing business branch of G20, is held in Ankara with attendance over 1000 businessmen and delegates of finance world from 60 countries. During the conference, B20 Turkey Trade Task Force President, Chairman of the Sabancı Group Executive Board Güler Sabancı gave the opening speech of "21st Century Trade: Challenges, Solutions And Requests" panel. Before her speech, Güler Sabancı met up with Christine Lagarde, President of IMF. Sabancı and Lagarde had an exchange of opinions on upcoming Girls20 Summit.
B20 Trade Task Force Coordination Co-President Harold McGraw assumed the moderator position of the panel which was held right after Güler Sabancı's speech. Paul Bulcke, the CEO of Nestle, Nils S. Andersen, the CEO of Maersk Group, Alexey Mordashov, the CEO of Severstal, Frank Ning, the President of COFCO, Jamal Malaikah, the President and CEO of NATPET were in the panel.
In her speech, Güler Sabancı stated the followings by sharing three key advice to overcome world trade inactivity:
"As all we know, trade is the engine of the economic growth and a matter for each government agenda. But unfortunately, commercial growth is more inactive during the recent years. For example, in 2014, commercial growth has decreased to 2.8%. This rate is even below the half of pre-crisis growth rate of 7%. IMF and World Bank have foreseen that commercial growth may decrease below 2% if current circumstances maintain. According to WTO, some of the factors contribute to the commercial growth in 2014 are as follows: General global inactive GDP growth, slowdown especially in growing economies and uneven recovery in developed markets. Exchange rate fluctuations, over 10% value increment in USA dollars in 2014 and increasing geopolitical tensions... Therewithal, there are some structural factors which are able to prevent it from becoming menace for commercial recovery.
According to IMF and World Bank findings, aforementioned structured problems are as follows: Slowdown in expanding of global value chains, increased protectionism and decrement in trade related investments. Therewithal, our hands are not tied before this pessimist picture. There are also key actions which can be implemented by governments to contribute commercial recovery. As organizations our role is to defend those key actions insistently and to be sure that they are applied.
As implementing previous suggestions is requested by this year's B20, as B20 Turkey Task Force we collaborate to determine due precautions required to be taken in order to lead the fastest and the most effective economical growth since February. B20 Trade Task Force agreed upon 3 key suggestions to present G20 governments".
- THREE KEY SUGGESTIONS FOR G20 GOVERNMENTS
Sabancı explained the suggestions by B20 Trade Task Force to G20 governments as follows: "Our first suggestion: "Is to accelerate Agreement on Facilitation of Trade of World Trade Organization (WTO) to be approved and implemented with high standards. In 2013, 159 WTO members agreed upon the precautions of simplifying trade in Bali and signed Agreement on Facilitation of Trade (AST) in 2014. Things to do are not over with this. In order that Agreement on Facilitation of Trade to be legally binding, approval of two thirds of WTO members are required. So far, only 12 members of which 4 are members of G20. Number of countries which have signed the agreement shall be increased to 40 in case that Europe signs the Agreement on Facilitation of Trade. I would like to highlight the importance of implementation again. An agreement without implementation has no value! In order that the global economy gets benefit from this, it is essential to implement the agreement fast and with high standard".
-"IF TRADE IS SIMPLIFIED, 21 MILLION NEW BUSINESSES WILL BE CREATED"
Sabancı continued as follows: "Trade costs may be decreased to 17% by implementing precautions for simplifying trade in accordance with the OECD studies. Each 1% recovery on trade costs is expected to be contributed to world economy more than 40 billion USA dollars. Similarly, according to Peterson Institute findings, it is predicted that implementing the agreement may create 21 million new businesses, including its 18 million in developing countries, and it may contribute to total gross national product of the world up to 1 trillion USA dollars. Those are significant numbers showing that we need to insist more to sign and implement this agreement.
As B20 Trade Task Force, we believe that G20 governments can play important role in implementing Agreement on Facilitation of Trade all around the world. First of all, signing agreement until the meeting of WTO in Nairobi and thus agreement serves as a model for other WTO members. Second, accelerating to implement the agreement with high standards in G20 government's countries. And third, developing and less developed countries should also be supported on implementing the agreement. Even tough today we would offer 3 suggestions for you, first of them is the most efficient and the simplest one to be implemented by the governments. It offers a great opportunity for the world trade. Please let us not to miss this opportunity!"
-"PROTECTIONISM SHOULD IMMEDIATELY BE RESTRAINED IN G20 COUNTRIES"
Sabancı stated that second suggestion of B20 Turkey Trade Task Force to G20 governments is to take urgent precautions on especially nontariff barriers in order to restrain protectionism. Sabancı continues as follows, "Even tough the governments reinforce their affiliates to Suspension Agreement and guarantee the actions related to termination of protectionist precautions, unfortunately nontariff restrictions were not taken desired care in the disclosure of last year and keep increasing in 2015. As B20 Trade Task Force, we recommend G20 governments to take significant actions immediately in order to control protectionist precautions!
B20 Trade Task Force is aware that prote13ctionism is a broad subject and it is hard to go into action or tracing the results of those actions without stating the targets or determining the priorities. Thus, as B20 Trade Task Force, we decided on narrowing the context and guiding to start. Within this context we suggest G20 countries to stop taking precautions on compulsory localization and compulsory local content category within the next year and to terminate priorly taken actions.
-"DIGITAL ECONOMY HAS A GREAT POTENTIAL ON TRADE"
By stating her third suggestion is to enhance the global trade system by removing the barriers before digital economy, Güler Sabancı continues as follows, "By referring the digital economy and offering this as our third suggestion, as business community we would like to tell that we are aware that digital economy has increased globally with a remarkable speed. Almost every day we testify that it creates new fields, changes its methods for business and trade as well as how it will change. As B20 Trade Task Force, we also see that the digital economy has a huge potential for trade. Therefore, to create the ground for the debates of 2016 we decided to include this subject in B20 Turkey agenda and so to attract the notice of the G20 governments with the key issues that constitute an obstacle to the growing digital economy.
In case to implement our suggestions of signing and implementing the Agreement on Facilitation of Trade, restraining the protectionism, improving the global trading system for the digital economy all together, it is expected to contribute for almost 2% of the global gross which is equivalent to the value set by the G20. In order to revive trade and to leverage the global economy as B20 Trade Task Force we believe that our those 3 suggestions has importance in G20 governments' agenda.
I would like to recall for signing the Agreement on Facilitation of Trade immediately until Nairobi Summit which will be held on the end of year. We expect G20 leaders to realize the urgency in taking initiatives for opening the way for implementing this global agreement and to be determined than ever."