high level grouPS

The High Level Group on Trade Policy Innovation was launched in 2017.

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Free trade allows people, companies and countries to specialise in what they are good in. According to economic theory of comparative advantages as well as modern theories of international trade, nations that are open to trade freely can achieve greater efficiency. In aggregate, free trade is growth enhancing, improves the competitive landscape and enhances living standards.

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However, long ago already Bertil Ohlin, Nobel Prize winner in Economic Science in 1977, has pointed out that global trade could lead to inequality too. His predictions, however, have been largely overlooked in the policy discourse and in the economic literature.

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In recent years, it has become apparent that free trade created an equity-efficiency trade-off, i.e. a trade-off between higher economic performance (growth rates) and a more equal income distribution between and within countries. The challenge now is to achieve inclusive and substantial growth. The complexity of the equity-efficiency trade-off is increased by technological change, environmental challenges and rising civic resistance.

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This HLG is chaired by Peter Altmaier, former Minister for Economy and Trade, Germany.