 Okay, well, I am extremely happy to be here. I used to work at Wider for six years, so this is homecoming for me. And I was debating with myself, what should I say in a session on the world economy, given that I've been for the last five years working on least developed countries and especially countries. What are special countries? Basically countries that are fragile, that they are geographically challenged, small islands, landlocked. So I tried to put together something that you could find interesting in this global challenging situation of trees slowing down, global recession, and so on. So what I'm going to do is try to take a snapshot of what is going on with trade generally and try to tease out some important trade policy issues and then to have a snapshot of the least developed countries and why that is important. As you know, least developed countries is a very heterogeneous and difficult criteria to handle because you have countries with different level of incomes, different socioeconomic challenges, and then you cannot put them in the low income countries box, in the middle income countries. They all want to graduate and become a middle income. In 40 years, we have two countries living in the categories. We have Cape Verde, a small island that graduated with reasons that have nothing to do with the special and differential treatment given to a disease. They graduated because of the focus on reshuffling the economy towards tourism and services and then Botswana because it was an accident that happened at the right time. They discovered they exploit the diamonds at the right time. So just moving quickly, what is the discussion in academia, policy circles, the economies everywhere about what we call now the new normal. What is going with trade? Is trade going to maintain a very slow movement? What is going to happen? Is it due to short-term cyclical factors? Is it due to a structural factor? Is the dose going to settle and everything is going back to normal? There is all sorts of arguments. So I'm going to argue based on some evidence, what are the two views and where we are. Basically trade and is one of the Stalifats for the last 50 years in international trade and development. Trade has been growing at a very fast pace and even pick up at some point in spite of the crisis but basically due to policies, technological innovation and other issues related to transaction costs but it has slowed down and we want to know is this going to remain like that? Is trade growth going to be sufficient to maintain a global GDP growth and then to help to a recovery? So this is what we have been estimating for the first coming trade and development report. This is a snapshot of trade volumes. You have here the developed countries and emerging markets. And the picture we have, these are the trends. So we can see that after the crisis here, trade remains subdued. So there was an impact on trade volumes. If you take both volumes of imports and volumes of exports and not only in developed countries but also in developing countries. So if you look at the trends, trade growth remains subdued and lower than what it was projected if the crisis had not happened. So what are the factors that we are looking at to explain this performance and what we call what economists now call the new normal. It's either short term, it's cyclical or it's the structural factors. As in everything in economics, we don't have an agreement. Some papers have estimated there was a very interesting book launch in June in Geneva that some paper estimated by Bernard Hochman that the cyclical factors is playing around 50% of the global trade slowdown. But then there are others that say, no, it has not, well, structural factors are important but what matters here is changes in the structure of trade and changes in the composition, changes in demand and also some issues related to policy whether there is a rise in protectionism following the crisis or not. But in general, in terms of the rise of protectionism or not, the agreement has been that the impact has been at the margin because protectionism has not risen. So basically assuming that, okay, there are cyclical factors but what really matters is the structural factors that might affect the back to the future or the future of trade. So the first explanation is the changes in the composition of world trade, especially the growing importance of services. Even low income countries and least developed countries are moving towards more production and exports of services trade. Also what was discussed yesterday in the trade session, the new economy, the new trade economy and the new way of producing in terms of the structure of trade and vertical specialization and the growing international fragmentation of production that has had an impact on trade flows. Also in terms of the composition of trade, sorry, the composition of GDP in the context of the crisis, the changes in the chair of investment in aggregate demand have had an impact. And as I mentioned, the chiefs in trade policy regime driven by a presumed rise in protectionism, although that has been challenged. Later I will come back briefly to this. So when we look at the trends, it's quite boring just to look at the numbers and try to relate, okay, growing is looking at trends, but for me what I find interesting is what lies beneath the trade policy regime and how that will affect the prospects of trade. So it's no secret that the role of emerging economies had had an impact on global trade and global economic performance, especially the reintegration of China in the global economy. And then more recently, they rebalanced in towards internal demand. They both had two different expected impact and the integration of southern economies had brought about more competition, more opportunities. South-south trade and foreign-direct investment has increased. For example, now in least developed countries, more than 50% of trade is with the south. So this is an important change in the shape of the global economy. Technological change has predicted by theory and empirical research, the ICT revolution, which in Africa and LDC has had a major impact, the splintering of production and the value chains. Here that already Stiglitz warned us this morning about these dangerous guys, these chiefs to our major regional trade agreements. Sorry. Yes, there's TPP, TTIP, all the T's. It's basically a move away from the principles of what the famous MDGA proposed of having a predictable open and multilateral trading system. And accompanied to that, we see no progress on DDA doha agricultural issues which also has major variants on low-income and least developed countries. How is my time? Okay. So. I need to find an example. Okay, so going back to the issue of protectionism or not like what we are looking at in the data and now at ONTAT we are producing very interesting monitoring exercise is that the increase of non-tariff measures as a way of protectionism. We know that some of these high sophisticated instruments are used by high income countries. The developing countries don't have the tools to implement this, but we see an increasing utilization of NTMs in relation to tariffs or also other sorts of subsidy. But this doesn't indicate that protectionism has increased on average. Other issues that we see in this new post-crisis period is that the recommendation of trading many developing countries, the impact of climate change and deterioration of environmental biodiversity and trade frictions and frictions in terms of policymaking as a result of shocks, especially exchange rate volatility and so on. So how do we measure all this? There have been several econometric models, exercise projections, but here we have a very simple trade elasticity, elasticity of trade in relation to changes in income. And it's very clear that the crisis had had an impact on the response of trade to the changes in income, especially across the different country groups. You see here that the light blue line is the pre-crisis period and then you see the sharp decline in post-crisis. Only Latin America trade is still, you don't see a negative response in the other regions, but it still is lower than before the crisis. So basically this picture is very telling. I mean, there is an impact on trade in the post-crisis period. But more importantly than region, we can also see the changes, the impact in terms of products. And the primary products here, the shock has been the most significant. So basically the weak trade performance is reflected in the slow response of trade in relation to GDP across countries and across products. There was the only positive note here is that in services and consumer goods, the response has been more positive than before the crisis. But then these, which are particularly important for LDCs and low-income countries, that's where they have suffered the most. So I mean, this is the global picture and then I'll move briefly in my five minutes to the least developed countries. I thought, I'm not very good saying economics joke, so I will present the maps of LDCs so you can see what our focus is. So we have 48 LDCs with South Sudan joining the group and the majority of them are in Africa. There is a lot of sensibility when we think about LDCs and link it to Africa, but the fact that the majority is there, the policy response, then you tend to think about Sub-Saharan Africa. And then you have the island state and you have the landlocked country. So how to put these countries in a global development context like the sustainable development goal when you have different constraints and different type of specialization. But still it's a focus of the UN and we are responsible for them. So here if you look at long-term growth in least developed countries, if you see the normal trend and then you see the adjust, this is a simple adjusted trend, you see that the crisis really came at a very bad time after GDP growth pick up in these developed countries. So you see clearly there, the choke, mid-nineties where they saw higher integration into the world economy, structural transformation in terms of, sorry, structural reforms, then comes the crisis. And if you compare the performance, this is also a very simple graph just comparing growth of LDC trade in comparison to world real output. If you see again 2008, the collapse there is also very, very, very telling. So what are the issues in terms of global trade and policies for LDCs? LDCs basically in addition to the important socioeconomic constraints is the issue of trade and geography. The share of LDCs in global trade is only 1%. So there is no moj that is, well there is a scope but this is very limited and the problem is it's very highly concentrated to the agreement with the US and the EU and the Every Simple Arms Initiative. So that's a problem. Then you have climate change. The estimates or the studies show that people in LDCs are five times more likely to die from climate change related disease than the rest of the world. Then on top of that around 70% of the population depend on agriculture. So any environmental shock will affect their livelihoods and the funds pledged at Copenhagen have not been made as usual. So this is, if you think about okay, these guys are trading a lot with developing countries and China and India have promised to liberalize 98% of trade with LDCs. But the problem is that 2% left out is cotton and agriculture which is the major exports of these developed countries. So the benefits are very limited if you look in that perspective. Basically I'm not going into details but this just show you the concentration in terms, apart from the concentration in terms of destination that I just mentioned, the concentration in terms of what they import and what they export. So the scopes for diversification are there but it requires a lot of policy intervention for that. What are the prospects? It's expected that they are going to continue growing. FDI will continue to come, especially to extractive industries. If you see here, you have fuel and it's very important for some LDCs and minerals. They are going to continue growing even above the other developing countries average. There is hope that the extension of Agoa will contribute to the diversification of FDI and trade, especially in African LDCs in the longer term. So this is the prospect. But there are challenges especially if we think about all the constraints in terms of value added in terms of the non-tradable, which are very important for broad-based poverty reduction. The linkages between large and small firms in LDCs is another issue. And the competitiveness of firms, if you take the case of Ethiopia that has pocket of excellence, you think Ethiopia is an LDC and has its own airline, one of the moxosefs. Yes, exactly so. But this is an issue that is gaining importance in the policy discussions in terms of LDCs. Just going back to the global picture, the slowdown of trade not necessarily means that we will remain stuck in the new normal. As I said, cyclical factors are important, but trade openness, there is not a declining trade openness. So it's not a fact that we are, the world will see a trade below the 60% of trade openness that we have been experiencing recently. There is further potential for vertical integration, technology and services across developing countries, and the focus on trade policy is important, but the broader development policy context I think is more important for these countries in the global context. And finally, coming from the UN, you have to think about the SDGs, otherwise it's almost heresy if you don't talk about them. Where is trade placed in this context? Before, in the 2000 frame where there was the Orphan Gold, the MVA, now there is more synergy between the inequality, labor, productivity issues, but how trade could be seen in that as a enabler for other LDCs I think is an important topic for discussion and that's it. Thank you so much.