Part II - Current Issues in Gender Equality and Trade Policies

5 Women in the LDCs How to Build Forward Differently for Them

Simonetta Zarrilli

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5.1 Introduction

Women across countries and regions face many obstacles that hamper their capacity to benefit fully from international trade and more generally from their participation in the economy. Hurdles include time poverty; discriminatory legal rules and social norms; limited access to productive resources and technology; and inadequate opportunities for education, training, and skill development. These shortcomings are also found in LDCs¹ and are magnified by persistent and acute development challenges that include high levels of poverty, deficient infrastructure, limited productive capacities, and a mostly low-skilled labour force.

This challenging situation has become even more dramatic as a result of the COVID-19 pandemic that has increased women’s already heavy burden of domestic and care work,² and has escalated the instances of male violence against them.³ Moreover, the pandemic has had a devastating economic impact on women by severely hitting sectors and occupations in which they are mainly involved.⁴

This chapter unfolds as follows: Section 5.2 provides a brief overview of the LDCs, their position in the global economy and the role of women in the economy of LDCs. Section 5.3 then explores the measures implemented by the LDCs to help people and companies to shoulder the pandemic-induced economic shock. Among the many measures put in place, it singles out those that, directly or indirectly, by design or by coincidence, have the potential to especially benefit women. Section 5.4 then tries to answer the following questions: Is there a good match between women’s needs and what so far has been provided to them through the rescue packages? What measures would be necessary to allow women to play a more active role in the economy, including in international trade, beyond the emergency measures? What are the preconditions to avoid going back to ‘business as usual’? Section 5.5 concludes.

5.2 The LDCs in the Global Economy and the Role of Women

5.2.1 The LDCs in the Global Economy

LDCs face common development challenges such as persistent poverty, deficient infrastructure, limited productive capacities, low investments, high debt burden, and mostly low-skilled labour force. Structural transformation and fruitful integration into the global economy have not materialized for most LDCs.

LDCs have very high trade-to-Gross Domestic Product (GDP) ratios, since they heavily rely on trade, both imports and exports, and all have trade deficits at present. Many LDCs are dependent on the exports of primary commodities and economic diversification remains a challenge for them.

Most LDCs have been through trade reforms during recent decades, including by acceding to the World Trade Organization (WTO). They benefit from full or nearly full duty-free and quota-free market access in most developed country markets and in an increasing number of developing country markets. Their exports also benefit from less stringent rules of origin in some markets. However, most LDCs have not been able to benefit from these concessions, mainly due to their low productive capacities and the limited role played by trade policy in their development strategies.⁵ Moreover, delays at borders, costly and opaque border procedures and high transport costs have contributed to the very limited integration of the LDCs into the global economy. In 2020, LDCs as a group produced only 1.4 per cent of the world’s GDP.⁶ They accounted for 1 per cent of world exports of goods and services, and their share in world trade in goods and services was 1.2 per cent.⁷

The main shortcomings that women face in other developing countries to become more involved in economic and trade activities and benefit from them are similarly found in the LDCs. However, for LDCs, such instances are amplified by shortcomings in most development dimensions.

Women play vital roles in the key economic sectors in LDCs, including in agricultural, industry, and services sectors. The following sub-sections provide discussions on their roles in these economic sectors.

5.2.2 The Agricultural Sector

The agricultural sector corresponds to 24 per cent of total economic activity in the African LDCs, 17 per cent in the Asian LDCs and 22 per cent in the Island LDCs (2019 data). In 2019, it contributed to 13 per cent of all LDCs exports, 15 per cent for the African LDCs, 10 per cent for the Asian LDCs, and 43 per cent for the Island LDCs (see Table 5.1). It remains the main employer for all LDC groups, with 55 per cent of the workforce employed in agriculture in 2019.⁸

Table 5.1 Sectoral contribution to LDC GDP and exports (2019)

Sectoral Contribution to LDC GDP, 2019 (%)
	LDCs (all)	African LDCs	Asian LDCs	Island LDCs
Agriculture	21	24	17	22
Non-manufacturing industry (incl. mining)	16	20	12	14
Manufacturing	14	10	18	5
Services	49	46	53	59

Sectoral Contribution to LDC exports, 2019 (%)
	LDCs (all)	African LDCs	Asian LDCs	Island LDCs
Agriculture	13	15	10	43
Non-manufacturing industry (incl. mining)	39	59	12	8
Manufacturing	28	8	55	12
Services	20	18	23	37

Source: Calculation by the author based on United Nations Conference on Trade and Development (UNCTAD) statistics.

Women make up between 41 and 45 per cent of total employment in agriculture in the LDCs.⁹ There is, however, a high degree of gender segregation in the crops being grown and in the production roles and responsibilities. Women are typically responsible for subsistence farming due to their traditional role to provide food security for the household. The transition from subsistence farming to commercialization and agricultural exports that has happened in several LDCs has attracted men’s interest and in many cases crowded out women. Gender segregation by crop is also due to traditional expectations for women to remain close to the household. From a legal point of view, men and women have equal ownership rights to property in thirty-seven LDCs; however, customary law prevails in most societies, preventing women from owning land and other property.¹⁰ This has a negative impact on access to credit that would enable women to expand production and participate in international trade.

There are gender gaps in productivity and earnings, mainly driven by the fact that women typically produce staple crops whereas men are more often involved in the production of cash crops.¹¹ Due to the difference in earning potential between staple and cash crops, women generate substantially less income. Household responsibilities and related time poverty contribute to making women less productive than men.

The difficulties that female farmers face is also the result of long-term problems affecting the agricultural sector in the LDCs, including import competition, especially when imported products benefit from massive subsidies; the shift of Official Development Assistance (ODA) away from agriculture; and governments’ underinvestment in agricultural research and development (R&D) and extension services, with a consequent loss in knowledge and capacity. Moreover, because of the lack of dynamism of the sector, men are increasingly migrating to urban areas, leaving women with growing responsibilities for farm activities and for the well-being of the household.¹²

5.2.3 The Industrial Sector

Between 2011 and 2019, the contribution of manufacturing to GDP remained constant in the LDCs at around 10–14 per cent. In 2019, non-manufacturing industries, including mining, contributed 16 per cent to GDP, with the highest value of 20 per cent in African LDCs (see Table 5.1).

Primary commodities dominate LDC exports, with an overall 39 per cent share of total exports (59 per cent for the African LDCs) (see Table 5.1), though the share of commodities in exports is shrinking. Conversely, exports of manufactures have steadily increased, reaching 28 per cent of total exports in 2019. Manufacturing exports represent 55 per cent of Asian LDC exports, but only 8 per cent of African LDCs (see Table 5.1). Hit by the pandemic, exports of manufactures, however, significantly declined in 2020. Mirroring the low level of technology diffusion and the low skill level of the workforce, most LDC exports are concentrated in low-technology and low-skill goods.¹³

As with other developing countries, in LDCs there is a feminization of labour in low-skilled manufacturing production, especially export-oriented, and a high degree of occupational gender segregation with the concentration of women in low-skilled jobs. EPZs have played an important role in providing wage employment to women. In Cambodia, virtually all production workers are young (aged eighteen to thirty) women.¹⁴ Women constitute around 70 per cent of employees in EPZs in Tanzania.¹⁵

5.2.4 The Services Sector

Services dominated the economy in all LDCs in 2019, representing almost 50 per cent of economic activities. Services play a particularly important role in island LDCs, where their contribution to GDP is around 60 per cent (see Table 5.1). Services exports have gained importance during the last two decades, reaching 20 per cent of total exports in 2019. In particular for island LDCs, services represent 37 per cent of their exports (see Table 5.1). Despite substantially growing, services exports remain concentrated in traditional transport and travel sectors.

Services’ employment share rose from 21 per cent in 1995 to 32 per cent in 2019. Wholesale and retail trade make up 15–18 per cent of economic activity within services as the largest sub-sector in all the LDC groups. The wholesale and retail trade sector corresponds to high levels of female employment, reaching between 30 and 40 per cent of female share of total employment in Haiti, Liberia, Benin, Sierra Leone, Zambia, Burkina Faso, Mauritania, and Togo (in decreasing order).¹⁶

Tourism provides women with opportunities for employment, formal and informal, direct and indirect, and for entrepreneurship. In many LDCs, the tourism sector is marked by intense occupational segregation: men are concentrated in high-skill and managerial positions, while women primarily participate in low-skilled tasks such as room cleaning, kitchen work, and waitressing.¹⁷ Employment in the tourism sector is mostly informal and temporary, for both men and women.

5.3 The COVID-19 Pandemic, LDCs, and Women

5.3.1 The Impact of the Pandemic on the LDCs and on Women

The COVID-19 pandemic has spared no country; however, it has proved particularly detrimental to some countries and to specific segments of the population. It has magnified existing inequalities across and within countries.¹⁸

The health effects of the pandemic in the LDCs are still unclear because of the difficulty of detecting and reporting pandemic-related illness and deaths accurately. However, what is clear is that LDCs have had limited access to vaccines and the world is witnessing a global failure of collaboration in making vaccines available to all. Only 2 per cent of the population in the LDCs was vaccinated against an average of over 40 per cent in developed countries as of mid-2021.¹⁹ The fundamental right to health is being denied. Moreover, considering that access to vaccines is a precondition for recovery, the situation is particularly worrisome.

The global economic downturn has had disproportionately adverse economic and social effects on the LDCs. Income losses, low investments, and reduced remittances have worsened extreme poverty in the LDCs, making 2020 the worst year from a growth perspective in about three decades.²⁰ UNCTAD estimates an increase in the poverty headcount ratio against the USD 1.90 per day poverty line of 3.3 percentage points – from 32.2 to 35.2 per cent in the LDCs overall.²¹ This means that compared to the pre-COVID-19 era, 35 million more people will live in extreme poverty in the LDCs in the post-COVID-19 era.²² Extreme poverty, beyond being a dramatic problem in itself, has negative repercussions for human capital accumulation, knowledge development, and labour productivity, and negatively affects the environment. The COVID-19 crisis is negatively impacting other fundamental rights, such as access to education, security, and protection against violence.

Meagre domestic financial resources and high debt levels are greatly affecting LDCs’ capacity to cope with pandemic-related shocks. The lesson learned from other health-related crises is that the health emergency will eventually be overcome, but if countries do not put in place the right policies, the negative economic and social repercussions will affect their development trajectory in the long run. The recovery path for the LDCs is projected to be slow and to constrain their process of structural transformation, which in turn will impact on their ability to meet the United Nations Sustainable Development Goals (SDG) Agenda 2030.

Turning to the specific impact of COVID-19 on women, the pandemic is estimated to result in millions of additional women and girls falling into extreme poverty. This means that the total number of women and girls living in extreme poverty may reach 388 million in 2022, compared to 372 million men and boys, or even increase all the way to 446 million in a ‘high-damage’ scenario.²³ It is also estimated that 83.7 per cent of the world’s extremely poor women and girls would live in Sub-Saharan Africa (62.8 per cent) and Central and Southern Asia (20.9 per cent), where most LDCs are located.²⁴

Economic downturns such as the present one is typically not gender-neutral. Several critical factors contribute to explain why. First, women are more at risk of losing their jobs than men because they often hold temporary, part-time, and precarious jobs that are the first ones to be cut. Second, women tend to work in the informal sector and rescue packages mainly target workers in the formal sector. Third, female-dominated sectors, such as hospitality and personal services, have been severely disrupted by the effects of the pandemic because of lockdown and social distancing measures, and travel restrictions. Fourth, access to credit is a critical factor for business survival during crises. However, particularly in developing countries, women entrepreneurs are often discriminated against when attempting to access formal lending schemes. Fifth, women have seen their burden of care work increase because of closure of schools and childcare facilities, and the provision of basic health care at home. Finally, lockdown and social isolation policies, coupled with the financial stress that families and individuals are experiencing, have dramatically exacerbated domestic violence.²⁵

5.3.2 The Rescue Measures in LDCs

By and large, all countries have made efforts to provide support to their populations and economies to shoulder the social and economic impacts of the pandemic. According to the COVID-19 Global Gender Response Tracker,²⁶ a total of 4,968 measures have been put in place so far; 1,605 measures, less than a third of the total, can be regarded as gender-sensitive since they address unpaid care (226 measures),²⁷ violence against women (853),²⁸ and women’s economic security (526).²⁹ Most measures are meant to support women who have been victims of violence, or the establishment of prevention and reporting mechanisms, in line with the view that women’s needs are in particular found in the private sphere.

The following section provides an overview of the rescue measures put in place by LDCs as available on the COVID-19 Global Gender Response Tracker. The purpose is to assess whether and to what extent those measures are directly targeting women, are targeting economic sectors and functions where women are particularly active, or are supporting women as heads of households or as those mainly responsible for the well-being of the household. In other words, the objective is to investigate whether the rescue packages deployed by the LDCs are providing, directly or indirectly, by purpose or by coincidence, significant support to women as far as their economic security is concerned.³⁰

5.3.2.1 Cash Transfers and Emergency Food Distribution

To alleviate pandemic-driven extreme poverty, almost all LDCs have resorted to cash transfers and/or emergency food distribution in favour of the most vulnerable and food-insecure households, on a monthly basis, for a determined period of time, or as a one-off intervention. Since female poverty has become particularly acute during the pandemic and is expected to last for several years to come, it can be assumed that women are benefiting from these measures, especially when, within the household, they are those directly receiving cash or food, as is the case in Sierra Leone and Togo, according to the Tracker.

In addition to targeting vulnerable and food-insecure households, some LDCs have identified specific categories of workers and sectors as eligible for cash transfers. They include agricultural and day labourers and domestic workers (Bangladesh), workers in the informal sector (Lesotho, Liberia, Nepal, Niger, Rwanda, Sierra Leone, Togo, and Zambia), including informal street vendors (Bangladesh, Burkina Faso, Liberia), and small businesses (Burundi, Malawi, and Mauritania).

Informal employment dominates to a large extent employment for both men and women, and especially for women, in most LDCs. More than 80 per cent of women in the non-agriculture sector work informally in Madagascar, Mali, Myanmar, Uganda, United Republic of Tanzania, and Zambia.

Street vendors, small-scale and informal cross-border traders, daily wagers, and domestic workers, occupations that include a large share of women, have been badly hit by the pandemic since lockdowns, social distancing measures, and border closures have made these activities unfeasible. It is estimated that women represent around 70 per cent of small-scale and informal cross-border traders in sub-Saharan Africa.³¹ Domestic workers are among the most vulnerable groups of workers, and they mostly work informally. According to the International Labour Organization (ILO), around 80 per cent of all domestic workers are women.³² The workers and occupations targeted for cash transfers seem, therefore, to include many women.

5.3.2.2 Micro, Small, and Medium-Sized Enterprises

The analysis now turns to measures targeting micro, small, and medium-sized enterprises (MSMEs), including both fiscal measures and cash transfers.

The health crisis has made firms face several challenges at the same time, namely, the suspension, at least during the first phase of the pandemic, of most face-to-face operations due to the need to observe social distancing and mobile restrictions, supply chain disruptions, and falling consumer demand.³³

Globally, there are around 9.3 million formal small and medium-sized enterprises (SMEs) that are fully or partially owned by women, which corresponds to approximately one-third of all formal SMEs.³⁴ These firms play a crucial role in the economy worldwide, including in the LDCs, as a source of employment and income generation, and as such they have been targeted in many rescue packages.

According to the LDC MSME Impact Survey, conducted in July–August 2020 across 2,245 firms in all LDCs, firms mainly operate in the sectors of tourism and catering (20 per cent), textiles and crafts (18 per cent), and industrial goods (15.3 per cent).³⁵ MSMEs have suffered a significant reduction in business capacity and anticipate a notable reduction in their annual revenue due to COVID-19. As much as 88 per cent of respondents indicated that they were operating on less than 75 per cent of business capacity; over 52 per cent anticipated a reduction in revenues; 34 per cent stated that they risked shutting down in the coming three months; and 35 per cent reported having laid off staff. Findings from the same survey show that the pandemic hit female-intensive sectors such as textiles and crafts, and personal and care services more severely than male-intensive sectors, such as finance, professional, and technology services. Moreover, female-led SMEs have reported higher rates of lay-offs and fewer resources to sustain their businesses in the short and medium term compared to male-owned SMEs.³⁶

Cash shortages have in particular affected women-led firms. This reflects the barriers women’s businesses face in securing adequate finance, a worrying situation experienced already in the pre-pandemic era. Moreover, in the pandemic era, alternative sources of finance, be they personal savings or borrowing from friends and family, have dried up.³⁷ Without easy and reasonable (in terms of ceilings) repayment and interest conditions, and access to credit, most companies, especially micro and small ones, are unable to shoulder the economic burden.

Angola has provided financial support to maintain minimum levels of activity of MSMEs in the manufacturing sector through funds for the payment of social security contributions and the removal of some administrative procedures. It has provided special credit lines to finance family agri-business and supported the capitalization of cooperatives in the agriculture, livestock, and fisheries sector, a sector that employs 56 per cent of women. Bangladesh has enacted a rescue package for SMEs at a concessionary interest rate. More than half of the interest is borne by the government to save firms and safeguard employment. Businesses are also allowed lower interest rates for imported raw materials. Burkina Faso, Chad, and Lao PDR have implemented tax relief measures for formal and informal MSMEs, and in the case of Mauritania for the artisanal fisheries sector. The Gambia enacted deferred tax returns for the wholesale and retail trade activities, which account for 45 per cent of women’s employment. Guinea has allowed banks to provide facilitated credit to MSMEs. In Liberia, the government has borne the loans owned by small and informal women traders and helped banks to increase lending to new borrowers. Senegal provides interest-free loans and subsidies to women entrepreneurs in the informal sector who have experienced significant operating losses due to the pandemic. The measures target a total of 1,000 beneficiaries working in areas such as fisheries, hairdressing, sewing, crafts, processing of agricultural products, and petty trade. In Uganda, the government has allocated funds to microfinance institutions to improve access to finance for MSMEs. The Uganda Development Bank offers low-interest financing to manufacturing, agribusiness, and other private sector firms. Malawi has put in place two measures in support of MSMEs. The first – an emergency cash transfer programme – involves small businesses which receive the equivalent of a USD 40 monthly payment, matching the country’s minimum wage, through mobile cash transfer. The second measure – increasing loans under the Malawi Enterprise Development Fund – is meant to support MSMEs that have been seriously affected by the pandemic. Mauritania provided financial support for three months to small individual businesses. In consideration of women’s role as micro and small entrepreneurs, it can be assumed that they could benefit from the rescue measures targeting MSMEs.

5.3.2.3 Tourism

The tourism sector was among the hardest hit by the pandemic. Social distancing measures and travel restrictions have driven the sector to an almost complete halt in 2020.³⁸ The situation is improving at present with the relaxation of most measures; as of May 2022, the sector has recovered to almost half of the 2019 pre-pandemic levels, though geopolitical tensions, rising fuel prices, and disruptions at major airports may reverse the recovery trend.³⁹ Globally, tourism earnings diminished by 40 per cent during the first half of 2020 as compared to the same period in 2019, badly hitting LDCs dependent on tourism revenues, as it is the case for Sao Tome and Principe, Timor-Leste, Samoa, Vanuatu, Comoros, and the Gambia (in decreasing order) for which, in 2018, tourism contributed to more than 40 per cent of export revenues.

Employment in the tourism sector tends to be informal and temporary, for both men and women. In Tanzania, for example, 38 per cent of men and 39 per cent of women in the tourism sector do not have formal written contracts. In Mozambique, 50 per cent of men and 46 per cent of women work in the tourism sector under unclear contractual arrangements.⁴⁰

Beyond wage employment, tourism provides women with opportunities for entrepreneurship, for example as owners of small tourism outlets, producers and sellers of handicrafts, tour guides, and providers of food services.⁴¹ Several LDC governments have therefore put in place measures meant to support the tourism sector. Bangladesh and the Gambia have provided emergency cash transfer to hotel workers. Bhutan supports workers in the sector through cash for work and cash for reskilling. Cambodia provides wage subsidies and training for tourism workers. Guinea allows banks to provide facilitated credit to businesses operating in the hotel, restaurant, and transport sectors. Lesotho has provided a grant covering the tourism and food sectors. Burkina Faso, Cambodia, Cameroon, Madagascar, Mali, Lesotho, and Niger have implemented favourable tax measures to support the tourism sector or specific sub-sectors. Also in this case, we can assume that women have benefited from the rescue measures targeting the tourism sector.

5.3.2.4 Textile and Garments

Another sector badly hit by the pandemic is the textiles and garment sector, which is one of the most female-intensive sectors worldwide, including in the LDCs, and a key economic sector for some LDCs.

In 2017, 85 per cent of workers in the apparel sector were women in Cambodia,⁴² and 90 per cent in Myanmar.⁴³ In Bangladesh, the number of women employed in the ready-made garment sector is estimated at 3.3 million, corresponding to 80 per cent of all workers in the sector.⁴⁴

The pandemic has led to a collapse in the global demand for clothing. During the first phase of the health crisis, a number of international brands and retailers cancelled orders, including for products already fully or partially manufactured, delayed payments, or demanded discounts. In Myanmar, during 2020, garment factories saw orders fall by 75 per cent due to the pandemic, which prompted many factories to cut their workforce or permanently close.⁴⁵ In Bangladesh, half of suppliers that participated in a survey administered in March 2020 had the bulk of their production cancelled, while 80 per cent declared that they were unable to provide severance pay when order cancellation resulted in worker dismissals. By the end of March 2020, at least 1.2 million workers had already been affected by order cancellations.⁴⁶

Bangladesh has set up a special scheme to support export-oriented garment companies. Owners are allowed an interest-free loan from the scheme to keep their factories running. Cambodia provides wage subsidies and training for workers of the garment sector and tax holidays for firms operating in the sector. Cambodia, Haiti, and Lesotho provide subsidies for workers in the textiles industry. Here again it can be concluded that women in principle can benefit from rescue measures targeting the textiles and garment sector.

5.3.3 The Magnitude of the Problem and the Resources Available

Once it is assessed that some rescue measures have directly targeted women, especially as heads of vulnerable households, and other measures deliberately or by coincidence have covered sectors and functions that include a large share of women, the next question is how effective these measures can be. Indeed, one-off interventions, transfer of very limited amounts of cash, and support provided during one or two months may be able to alleviate immediate and acute emergencies, but not to provide sufficient ‘breathing space’ for workers and firms to survive and plan for the future.

LDCs have been able to devote a median USD 18 per inhabitant in terms of additional spending or forgone revenues, which is a tiny fraction of the median USD 1,365 that developed countries were able to dedicate to their inhabitants.⁴⁷ Substantially higher amounts are necessary for the rescue packages to be effective and make a difference, especially for those particularly hit by the pandemic, such as women. Moreover, it is necessary to include in the rescue packages not only provisions meant to face the most acute phase of the crisis, but also measures that will allow LDCs to be back on track to meet the SDGs. Indeed, the seventeen SDGs are interlinked. Gender equality and women’s and girls’ empowerment will be the result not only of fully implementing SDG 5, but also other relevant SDGs. They include SDG 1 on poverty eradication, SDG 2 on ending hunger, SDG 8 on inclusive and sustainable economic growth, SDG 10 on reducing inequality within and among countries, and SDG 17 on strengthening the means of implementation and revitalizing the global partnership for sustainable development.

Domestically, LDCs need to strengthen their fiscal capacity, increase domestic resource mobilization, and improve the effectiveness of public expenditure. From the outside, they need a mix of financial resources, debt alleviation, transfer of technology, capacity‐building, and inclusive and equitable trade at the global and regional level. In its 2020 LDCs Report, UNCTAD estimates that the total average expenditure needed to meet selected SDGs varies from USD 875.9 to USD 1,464.9 billion per year for the group of LDCs, once combining the forecast total social and environmental spending with estimated investments.⁴⁸

5.4 The Way Forward

Going back to ‘business as usual’ is not a suitable alternative for the LDCs, especially for women living there. This chapter has provided an overview of the main shortcomings that the LDC were already facing before the pandemic hit them. The situation has dramatically worsened since. If not addressed, these shortcomings will curtail LDCs’ prospects for development and for a more beneficial participation in the global economy, which will reverberate for women’s prospects.

LDCs have put in place a host of policy measures that aim at attenuating the adverse impact of the pandemic on their populations and economies. As this chapter has shown, several of these measures address concerns and problems faced by women in LDCs, though the funds available undoubtedly fall short of the needs.

Looking forward, LDCs need to design and implement policies and strategies aimed at their mid- to long-term development prospects in such a way that women’s concerns are properly tackled. Addressing and overcoming the longstanding barriers women face in all spheres should be at the top of the new agenda of all countries, including the LDCs.

What would building forward differently mean for the LDCs and especially for women in the LDCs? A number of measures are suggested in the following. While some of them refer to deepening and broadening policy measures adopted in response to the pandemic shock, others are targeted at the long-standing development challenges of LDCs.

5.4.1 Building Forward Differently

• Human capital should be upgraded. Improved education for women would facilitate the shift from precarious and low-skill jobs to more stable and formal employment. In particular, enhanced access to education would increase women’s openings in sectors that attract better pay and provide opportunity for skills and career development. Shortage of qualified workers is often mentioned as one of the main obstacles for firms to expand in the LDCs.⁴⁹ The emergence of advanced technology is making this constraint even more damaging. Improving the quality of education and encouraging women to enrol in STEM disciplines would provide a win–win solution.

• The business environment needs to improve. Three regional groupings in Africa – Common Market for Eastern and Southern Africa (COMESA), East African Community (EAC), and Southern African Development Community (SADC),⁵⁰ each of them including several LDCs – have some of the longest processing times and highest costs for imports and exports compared to other regions of the world. To overcome this, a growing number of LDCs are putting in place measures to cut red tape, lower barriers to entry, foster competitiveness, and facilitate trade. Such measures may benefit actual or potential entrepreneurs, including female MSMEs and small-scale cross-border traders. Trade facilitation reforms and human capital improvements should be coordinated to ensure a switch to more productive and technology-intensive sectors, and make entrepreneurship, especially female entrepreneurship, a sustainable and growth-oriented endeavour instead of a survival economic activity. A precondition to boosting female entrepreneurship is to facilitate women’s access to credit, not only as an emergency measure, but as a way to overcome a long-standing form of gender discrimination that impedes female-headed enterprises from growing and playing a more positive role in the economy.⁵¹

• A renewed focus is needed in agriculture and rural development. The sector should be a priority for inclusive and sustainable growth in the LDCs in consideration of its role as the main employer of men and women and its contribution to poverty alleviation and food security. Improved access to inputs and extension services, crop diversification, and agro-processing are all developments that would benefit the LDCs and women in the LDCs, provided that women’s specific needs and the gender challenges that these developments can imply are addressed.

• Services are increasingly important in the economy of the LDCs, and their role in manufacturing is growing through ‘servicification’.⁵² The linkages between the two sectors – manufacturing and services – may contribute to them reinforcing each other and could lead to more sophisticated, technology-intensive, and value-added outcomes. Again, in this case, the distributional effects of these developments should be carefully assessed to avoid leaving some segments of the population, including women, behind.

• Now that the emergency is over, most safety nets have been removed’. The ongoing response to the COVID-19 pandemic has provided good examples of measures that may be beneficial in the medium run and not only to face emergencies. Several LDCs have extended their safety nets to informal workers. Such measures should continue once the health emergency is over since they are essential both for social cohesion and to accelerate inclusive economic recovery. Moreover, measures should be put in place to facilitate business formalization.

• Women’s participation in decision-making needs to be enhanced. Women are playing a minor role in the task forces set up to design and implement COVID-19 rescue packages. According to the COVID-19 Global Gender Response Tracker, of the 262 task forces for which membership data is available, women make up less than a quarter of members and are not represented at all on 10 per cent of all task forces. The inclusion of explicit gender considerations in the medium- to long-term recovery plans would be greatly facilitated by the participation of women in the discussion and decision-making processes. For this to happen, ministries of gender equality and women’s groups should be given adequate resources and an influential role in policymaking.

5.4.2 Building Forward Differently through Trade

Trade policy is one of the important tools that can be used to increase LDC inclusion in the world economy and offer new economic opportunities to women. Devising measures that promote women’s participation in trade and ensuring that the benefits from trade reach women and men equally can be an effective way for LDCs to step up their efforts towards a more inclusive and gender-equal order after the pandemic.

• It is important to keep markets open. Ensuring a free, fair, non-discriminatory, transparent, predictable, and stable trade environment remains essential to ensure the availability of essential goods and promote a strong economic recovery from which all should benefit.⁵³

• Make the trade debate gender-responsive. The WTO Joint Declaration on Trade and Women’s Economic Empowerment launched at the margins of the 11th Ministerial Conference of the WTO in 2017 signalled the departure of the trade community from its longstanding position that trade is ‘gender-neutral’.⁵⁴ Discussions, exchange of experiences, and reviews of research work on trade and gender were held at the WTO following the adoption of the declaration and culminated in the setting up of the informal Working Group on Trade and Gender in September 2020. The Working Group took on board the ambitious task to launch a new declaration at the following Ministerial Conference, MC12. Negotiations resulted in the Draft Joint Ministerial Declaration on the Advancement of Gender Equality and Women’s Economic Empowerment within Trade. One of the objectives of the declaration was to explore and analyse a gender perspective and women’s economic empowerment issues in the work of the WTO. Though the declaration ultimately was not tabled at MC12, member countries may still be willing to include a gender perspective in WTO work. Such a development could lead to transformative results since the analysis on the nexus between trade and gender will permeate WTO work rather than be clustered in a specific working group or specific meetings where gender issues are on the agenda.⁵⁵ The shortcomings that women in LDCs face could then be addressed and solutions discussed in several WTO bodies, those where the link between the issues under discussion and women’s economic empowerment is rather straightforward, for example trade facilitation, MSMEs, Technical Barriers to Trade (TBT), and Sanitary and Phytosanitary measures (SPS), or public procurement, but also when discussing agriculture, services, or intellectual property rights, to mention a few. While it may be less evident, there is a close link between discussions and negotiations on these issues and women’s enhanced or diminished opportunities in these areas.

• Conduct ex ante evaluations of the gender-differentiated impacts of trade. The approach to trade negotiations has long been that the impact of a new trade agreement should be assessed for a country as a whole. Such an approach, however, fails to identify how a trade agreement or a trade reform may impact different segments of the population. Identifying those who will benefit from the new measure and conversely those who may be negatively impacted by it may be the first step to put in place buffer measures, at least in an initial phase of implementing the new measure, or to reconsider the terms of the negotiations to mitigate the foreseen negative effects. Indeed, while a trade reform may overall be beneficial for a country, it may not be so, for example, for the rural population, or for the elderly, or for women and girls. The call to conduct gender assessments prior to negotiating a trade agreement was included in the 1995 Beijing Platform for Action.⁵⁶ Governments were advised to seek to ensure that trade agreements do not negatively impact women’s new and traditional economic activities, and, more broadly, that macro- and microeconomic policies are assessed through an ex ante gender analysis and reformulated if harmful impacts are expected to occur. At present, Canada and the European Union provide the most advanced examples of conducting ex ante gender assessments of trade agreements. The Canadian Gender-Based Analysis Plus (GBA+) mandates the integration of GBA+ in all policies, plans, programmes, and initiatives, including trade agreements, to assess their impacts on different groups of people.⁵⁷ The GBA+ has been used for the first time with reference to a trade agreement during the Canada–Mercosur Free Trade Agreement (FTA) negotiations. In the case of the EU, Sustainability Impact Assessments (SIAs) analyse the potential economic, social, and environmental impacts of a proposed trade agreement while the negotiations are ongoing. Gender considerations are introduced to SIAs among the social themes under ‘equality’. The use of ex ante gender assessments will hopefully expand and become a regular feature of trade negotiations. Some outstanding issues related to the scope and feasibility of the assessments remain, including data availability to conduct impact assessments that are not limited to analysing the potential impact of an agreement on women’s employment in the formal sector. Moreover, a key point is to ensure that the findings of the impact assessments are duly considered during the negotiations and reflected in the outcomes. An ex ante gender assessment of the African Continental Free Trade Area (AfCFTA) would be especially useful to support the development of national strategies that countries are currently called upon to develop.⁵⁸ While the continental agreement is expected to provide numerous new opportunities, it is crucial to assess whether these opportunities will equally reach men and women. If they do not, measures should be introduced to rectify any foreseen negative effect.

• It is also pertinent to enhance and strengthen the collection of data. A full appreciation of the distributive effects of trade, including on women and men, requires the availability of a wide range of sex-disaggregated statistics. While data on education and health, labour force participation, and political participation are usually available in LDCs, statistics on working conditions, consumption, time use, entrepreneurship, and on policies and laws that influence gender equality, among others, are still difficult to find. This is an area where international organizations could provide support to the statistical offices of the LDCs.

• Ensuring policy coherence is quintessential. Building forward differently implies coordination between policies, both at the domestic level and between domestic policies and regional/multilateral ones. If policy coherence was necessary in the pre-pandemic era, it is even more so at present, when countries face multifaceted challenges from COVID-19.

5.5 Conclusion

This chapter has briefly presented the position of the LDC in the world economy and in international trade and has focused on women in the LDCs, looking at the role women play in the economy and in trade. It has highlighted the many problems that women face in the LDCs, exacerbated by unresolved development challenges and currently magnified by the pandemic.

The LDCs, as all other countries, implemented rescue measures to shelter their people and economies from the impact of the pandemic. A considerable number of measures appear to have the potential to directly or indirectly, by purpose or by coincidence, benefit women. They include those supporting MSMEs, highly female-intensive sectors such as agriculture, tourism, and the textiles and garment sectors, or informal workers. However, the amount that the LDCs have been able to devote to their inhabitants is extremely low – USD 18 per inhabitant as compared to USD 1,365 in rich countries, with a consequent limited and short-term effect. To make their interventions more impactful and long-term, at the domestic level LDCs need to strengthen their fiscal capacity, increase domestic resource mobilization, and improve the effectiveness of public expenditure, while from the outside they need a mix of financial resources, debt alleviation, transfer of technology, and capacity‐building.

The chapter concludes by highlighting some measures that would help the LDCs build forward differently for the benefit of their populations, and especially women. The upgrading of human capital, the overall improvement of the business environment, a renewed interest in the agricultural sector and rural development, special attention to the development and gender implications of further linking the manufacturing and the services sectors, and support for women’s participation in decision-making processes, including those related to the rescue packages, were singled out. Moving more specifically to how trade could contribute to improve the prospects for women in the LDCs, the chapter emphasizes that some developments look particularly promising, including conducting on a regular basis ex ante gender assessments of trade agreements, strengthening the collection of data that would allow the distributive effects of trade to be grasped fully, making gender considerations a feature of all WTO work and deliberations, and ensuring that the trade environment remains free, fair, non-discriminatory, transparent, predictable, and stable. The chapter calls for policy coherence between domestic, regional, and international policies and initiatives. Coherence is identified as a precondition for countries, including the LDCs, to be able to face the unprecedented human, social, and economic challenges deriving from the pandemic and avoid women bearing a disproportionate brunt of it.

6 Gender-Inclusive Governance for e-Commerce, Digital Trade, and Trade in Services A Look at Domestic Regulation

Amalie Giødesen Thystrup

^*

6.1 Introduction: Policymaking for Trade and Gender

Following the 11th Ministerial Conference (MC11), World Trade Organization (WTO) debates among members have concentrated around four substantive agendas: investment facilitation; micro, small, and medium-sized enterprises (MSMEs); services DR pursuant to Article VI:4 of the General Agreement on Trade in Services; and e-commerce. The four agendas produced joint initiatives announced on 13 December 2017 during the final day of the MC11.¹ Among the four JSIs, negotiations between ultimately sixty-seven WTO members on services DR successfully concluded on 2 December 2021.²

The WTO discussions on the interplay between the cross-cutting agenda for gender equality anchored in the Joint Declaration on Trade and Women’s Economic Empowerment on the Occasion of the WTO Ministerial Conference in Buenos Aires in December 2017 (the Buenos Aires Declaration on Women and Trade) and the four Ministerial Statements picked up steam post-MC11.³ These efforts see the WTO hosting a series of discussions sparked by the declaration on a range of specific topics to share best practices and national experiences with a view to unlocking trade benefits for women.⁴ Open to all members, the Informal Working Group on Trade and Gender meets at the WTO to further the discussion.⁵

New and enhanced disciplines on services DR, including a provision on gender equality, were projected to deliver outcomes at the MC12 in June 2022, initially scheduled to be held in Geneva from 30 November until 3 December 2021. Participants in the negotiations on DR concluded text-based discussions at their meeting on 27 September 2021. Signatories to the initiative proceeded to circulate national schedules of specific commitment pursuant to the General Agreement on Trade in Services (GATS).⁶

These efforts were to pave the way for the conclusion of the negotiations by MC12 in 2021.⁷ Despite the postponement of MC12,⁸ negotiators persisted and reached an agreement on services DR among the JSI’s sixty-seven WTO members on 2 December 2021 (JSI 2021).⁹ As a plurilateral agreement within the WTO, the JSI’s disciplines will be applied on a most-favoured nation (MFN) basis, and the members that are signatories will inscribe any commitments into their schedules under GATS as additional commitments.¹⁰ This means that it will benefit the full WTO membership, and not solely the sixty-seven signatories.¹¹ The JSI 2021 includes a provision on gender equality where a member adopts or maintains measures relating to the authorization for the supply of a service.

As a plurilateral agreement, the conclusion of JSI 2021 does not form part of the ‘Geneva Package’ of negotiated multilateral outcomes that MC12 secured when it was successfully concluded on 17 June 2022.¹² However, the three co-chairs of the Informal Working Group on Trade and Gender issued a statement at MC12 highlighting the achievements of WTO members’ joint work and reaffirming their commitment to advancing gender equality in trade.¹³

The chapter will organize discussions of the effects of trade on gender gaps around the four modes of supply of services in GATS Article I:2 (a–d), to reflect the crucial avenues for economic participation in the economy that are at stake. After this short introduction of the trade and gender agenda, Section 6.2 outlines the economic structures driving the gender gap and specifically the gender digital divide. The chapter then turns to examining the relationship between gender, e-commerce, digital trade, and services trade in Section 6.3. Next, Section 6.4 restates a framework for gender-inclusive governance for trade and examines policy prescriptions for bridging the gender digital divide. Section 6.5 examines policy interventions in digital trade. Section 6.6 looks at policy interventions in services trade based on a close reading of the provision on gender equality introduced in DR to unlock its legal-political implications. Section 6.7 concludes.

6.2 The Gender Gap in Trade

According to the World Economic Forum’s (WEF) definition, the gender gap is the difference between women and men as reflected in social, political, intellectual, cultural, or economic attainments or attitudes.¹⁴ The chapter subscribes to the understanding that the gender gap encompasses the structural differences women face in terms of (i) the gendered composition of the labour force, (ii) women’s primary responsibility for reproductive work, and (iii) women’s differential access to and control over resources relative to men.¹⁵

Research in the last decade has begun to produce evidence that the assumption that trade reforms will benefit men and women equally does not always hold. Because of the different roles that women and men have in society, trade policy does not automatically generate gender-neutral results.¹⁶ Simply put, trade rules are not gender-neutral.¹⁷ Gender-based inequality in turn impacts trade patterns and trade outcomes because it influences the patterns of resource allocation and competitive advantages of countries.¹⁸ The impact of trade on women and men differs because they tend to operate in different sectors and have differentiated access to resources.¹⁹

Women are impacted in various and overlapping roles as producers, employees, business owners, managers, and consumers. In turn, these factors shape different supply responses, vulnerabilities to economic change, and, more broadly, abilities to seize export opportunities and absorb adjustment costs.²⁰ With women as workers, but also as entrepreneurs and business owners, concentrating in less export-oriented sectors such as services, trade liberalization does not extend the same benefits of competition and broader supply that drive down prices.²¹

The International Trade Centre (ITC) finds that the gender gap in trade is largely due to the concentration of women’s employment in less export-oriented sectors, notably in services sectors.²² The Organisation for Economic Co-operation and Development (OECD) arrives at the same conclusion.²³

It is not that services are less ‘tradeable’ than goods, though services sectors are associated with being less export-oriented than those for goods. In fact, whenever a good is exported and crosses borders, the supply of a service is involved, whether it is at the early stages of design, transportation, or delivery. Thus, GATS Article I:2 (a–d) defines trade in services as the supply of a service from the territory of one member into the territory of any other member (cross-border), in the territory of one member to the service consumer of any other member (consumption abroad), by a service supplier of one member, through commercial presence in the territory of any other member (commercial presence), or by a service supplier of one member through the presence of natural persons of a member in the territory of any other member (mode 4). Moreover, services are integral to global value chains (GVCs), to the effect that services generate trade in value added.

Contemporary research reflects that services are not as often or as easily supplied along the four modes of supply, and instead such services may be supplied domestically and without the service, the worker, or the business crossing any borders to new markets. Thereby, the supply of services would also avoid the regulatory barriers to trade that, generally speaking, are pronounced in services trade.²⁴ This is why GATS Article VI on DR imposes disciplines on domestic regulations in committed services sectors to discipline domestic regulations that are neither discriminatory nor quantitative in nature, where domestic regulations could nonetheless have trade-restricting effects on services.

A main reason why women tend to concentrate in services is that several of the sectors are gendered. The mining, oil, and gas sectors are examples of sectors with a low ratio of women among its labour force,²⁵ while high concentrations of women workers are observed in sectors such as education and healthcare.²⁶ Generally speaking, traditional healthcare cannot be supplied at a distance cross-border, and supplying healthcare to consumers abroad requires authorization, while travelling to a different country as a healthcare provider would often require a permit or a visa. Thus, the benefits of trade liberalization would not extend to those sectors and consequently double down on the concentrations of women supplying such services. Data shows that firms that export pay higher wages.²⁷ More so, arguably it is to the detriment of women workers specifically if the benefits associated with trade do not extend to them.

However, trade does create jobs for women in export-oriented sectors, and those jobs also serve to bring more household resources under women’s control, which in turn leads to greater investments in the health and education of future generations. However, differences in wages earned by men and women persist in all countries.²⁸

Women’s primary responsibility for reproductive work implies a time constraint on participating in trade as women carry most of the burden of child rearing and domestic work, which decreases flexibility.²⁹ The third structural difference women face pertains to access to and control over resources.³⁰ A woman may, for example, run the household but not control any capital, or work in agriculture but not hold property rights. Other examples would include lack of recognition before the law preventing a woman from opening a bank account in her own name, or impaired access to education, knowledge, finance, or other means of value that are prerequisites to economic participation.³¹

Against this backdrop, it is submitted that the existing patterns of trade to a large extent perpetuate structural challenges facing women in the economy at large: (i) Women face greater disadvantages in responding to new economic incentives because of gender differences in access to productive resources, including land, credit, education, skills, infrastructure, utilities, and services. (ii) Women tend to concentrate in fewer sectors, and face gendered job segregation. (iii) Time constraints dampen women’s response to potential opportunities in new economic activities, and poor infrastructure and poor services heighten these challenges for women in developing countries.³²

Gender-based differential access to or constraints on labour, time, and resources create a gap. We speak of a ‘gender gap’ to reflect how the structural differences produce de jure and de facto discrimination, and because the conditions for the gender gap are based on sex, but on gender more broadly. These structural differences can produce discrimination against more groups of individuals, reflected in a wider concept of gender equality that is sensitive to sex, status, and socio-economic norms. Thus, the gender gap is a multidimensional concept.

Structural challenges produce gender inequality in the economy that interacts in complex ways with socio-economic components such as origins and status, and with the divides in trade and the economy at large that are broadly accepted as determinants of export capabilities, in particular firm size, level of development, and level of digitalization. The gender gap, conceptually centred around labour, time, and resource constraints, interacts with such divides to the effect that the divide can deepen and the gender gap can widen by implication. Cross-cutting divides to that effect would include the trade finance gap, the divide between MSMEs and larger entities, divides between levels of development among countries, and the digital divide. The implication may be understood as the multiplicity of the gender gap.³³

6.2.1 The Gender Digital Divide

Remy defines the gender digital gap as ‘the gender differences in resources and capabilities to access and effectively utilise information and communications technology (ICT) within and between countries, regions, sectors and socio-economic groups’.³⁴ Based on the literature, Remy identifies the following root causes for the gender digital divide: (i) women’s limited access to the internet and digital technologies; (ii) low technological literacy rates among women; and (iii) limited visibility of women in decision-making roles within the tech industry.³⁵ Women are fairly well represented across industries but, as with other gendered sectors, that is not the case in technical jobs, or in technological courses, and the issue here is one of gender stereotyping and also its impact on education selection.³⁶ This structural problem produces the conditions for a gender digital divide.

The gender digital divide reflects the multidimensional nature of the gender gap and its multiplicity – indeed, the gender digital divide is a prime example of how the gender gap interacts with other divides, and to what effect. It is submitted that impaired access to information technology (IT) infrastructure and IT skills compounds or exacerbates the gender gap into a gender digital gap. Consequently, the gender digital divide produces disadvantages in seizing technology-driven opportunities because of gender discrimination combined with low access to infrastructure, finance, and IT skills. Indeed, access to these resources are imperative for seizing export opportunities in e-commerce, and arguably in digital trade too, as access to IT skills and IT infrastructure are prerequisites for participation.

6.3 The Relationship between Gender, e-Commerce, Digital Trade, and Trade in Services

One avenue for increasing gender-inclusive participation in the trading system is through e-commerce. The sector performs extremely well and has a number of advantages over traditional commerce, which was rocked by lockdowns prompted by the global pandemic that adversely affected women’s economic fortunes in particular.³⁷ During this time, e-commerce saw the reverse trend, with demand soaring and supply following suit to the extent that the sector generated massive revenues for online shopping giants in particular, despite supply chains experiencing delays in delivery.³⁸

A joint paper between the United Nations Conference on Trade and Development (UNCTAD), the WTO, and the World Bank draws on empirical analyses to provide greater clarity to the interplay between women, trade, and ICT in the face of increasing digitalization. The study analyses how technological developments such as e-commerce platforms and other digital solutions enable and can enhance women’s participation in trade.³⁹

Research has also produced recommendations on policy prescriptions for how e-commerce can incorporate gender equality to meet SDG 5 by acting on the goal’s explicit reference to using technology to deliver gender equality. This research presents a framework for understanding the multiplicity of gender gaps in e-commerce and provides an analysis of key regulatory and policy challenges women face in e-commerce, before advancing a multi-level approach to incorporating gender-inclusive e-commerce regulation into trade policy.⁴⁰

Services play an increasingly important role in job creation, economic output, and in trade in countries at all development levels.⁴¹ Moreover, the supply of services is ubiquitous to e-commerce. Trade in services is also at the heart of digital trade, which has emerged as a reference point for policy practice dedicated to online trade, almost by definition involving the supply of a service under one of the modes of supply. In the European Commission’s taxonomy, and as reflected in the EU’s trade policy communication, ‘An Open, Sustainable and Assertive Trade Policy’ from 2021, digital trade refers to commerce enabled by electronic means, including by telecommunications and/or ICT services. Digital trade covers trade in both goods and services, and it affects all sectors of the economy.⁴²

Yet regardless of the policy practices devoted to the subject, trade in services remains severely understudied from a gender perspective. While a body of mainly empirical research on gender and trade in services linkages in a development context is emerging,⁴³ more research is needed.

Moreover, e-commerce, digital trade, and trade in services might separately or in combination feed into GVCs. Bamber and Staritz reassess the idea of feminization of GVCs of trade by focusing on the implications of countries moving into higher GVC sectors, namely in technology. Here, a need for much more evidence-based research is identified but a picture emerges of a reality that is not benefiting women, with lower female participation in high-tech sectors. The picture even suggests defeminization of GVCs. When examining the cases of the Dominican Republic and Costa Rica, Bamber and Staritz find that the female intensity in the medical devices sector was higher from the outset and held steady as firms in the sector upgraded into more sophisticated products where women found quality jobs, permanent contracts, benefits, and relatively high wages. In contrast, a study on mining-related GVCs finds that the growing recourse to digital technologies has yet to translate into increased levels of female participation.⁴⁴

This backdrop suggests that making the connection between gender, e-commerce, digital trade, and trade in services, and applying lessons learned, can advance the research agenda and provide value to policy-making.

6.3.1 The Key Policy Challenges of Market Access, Resources, and Regulatory Aspects for Gender-Inclusive Trade

The following section will show how key policy challenges for gender equality across the multiplicity of the gender gap in trade at large and in e-commerce, digital trade, and services trade specifically include market access, access to resources, and a regulatory aspect.

6.3.1.1 Market Access

Suominen’s study of current patterns for e-commerce controls for firm size, and finds, for one, that the gender gap is not unique to e-commerce as it is a structural feature of the economy. By implication, there are no significant differences between male and female participation rates in e-commerce relative to the wider economy. The study also finds that regardless of whether firms were run by men or women, smaller firms are uniformly less likely to export and are more hampered in e-commerce than large firms, as is the case with cross-border trade at large.⁴⁵ The impact is in the correlation – as per the findings highlighted earlier, women as workers and as suppliers tend to concentrate where the gender gap as a structural feature of the economy is felt and in those smaller firms that are uniformly less likely to export.

E-commerce offers MSMEs and small and medium-sized enterprises (SMEs) several advantages in regard to export and market access. Such advantages include lower transaction costs, access to larger or new markets, secure payment options, and, arguably, faster productivity and output growth. Thus, women in particular could stand to benefit from e-commerce because it allows them to connect directly with buyers, thereby circumventing de jure or de facto discriminatory local business or legal practices. Furthermore, evidence suggests that women increase sales volume and profits when selling to destinations further from their home country rather than over a single border.⁴⁶

Online work and ICT-enabled services exports can be particularly empowering for women expected to stay at home, and where women lack the professional networks and resources relative to men.⁴⁷ However, getting to the stage of export, and tapping into the cross-border trade that improves conditions, is more difficult for women. First, because they may receive a lower price in product markets, as shown in a study about eBay.⁴⁸ Secondly, women exporters face more trade obstacles than men do, with 74 per cent of women-owned firms reporting challenging non-tariff measures (NTMs) compared to 54 per cent of businesses owned by men.⁴⁹

Digitalization can help make it possible for women to trade cross-border to reap the benefits suggested earlier, and with the benefit of anonymizing the exporter’s gender online. Anonymizing gender online improves the conditions for gender equality because it removes immediate bias in exporting, which carries real economic value in terms of market access and could carry the full price.⁵⁰

However, this is not a given, and the picture of improved market access granted by anonymization of gender is more complex. Online suppliers may lose some of the benefit of gender being anonymized online since a licence is required to access the market. Even when the seller’s gender is anonymous, women may receive a lower price than men would collect for the same good or service because of limited business networks, for example.

Moreover, in policy terms, anonymization is insufficient for market access when the goal is more profound change that reflects the structural aspect of gender-inclusive trade policy-making.⁵¹ This is because anonymization does not remedy underlying issues such as limited access to financing or the persistent structural differences women face. Thus, it is submitted that the approach may not serve to consolidate a gender-inclusive trade policy.

6.3.1.2 Access to Resources

In line with the thinking underpinning anonymizing gender online,⁵² a joint paper by UNCTAD, WTO, and the World Bank on the interplay between women, trade, and ICT in the face of increasing digitalization finds, inter alia, that digital solutions may reduce face-to-face interactions, which in turn improves the participation of women entrepreneurs in trade networks traditionally dominated by men. The analysis highlights payment technologies as means to ease provision of financial services for women in e-commerce.⁵³

Evidence shows that it is more difficult for women to access financing than it is for men because of gender biases among investors and lenders.⁵⁴ ITC research shows that the trade finance gap that women entrepreneurs in emerging markets face is around USD 260–320 billion per year.⁵⁵ Here, e-commerce is instrumental for women because digital trade would, in theory, be less costly, and therefore require less financing because participation takes place without the physical attributes of a store. Yet participation in e-commerce and digital trade alike would still require some financial infrastructure, such as e-payment systems and access to a bank account.⁵⁶ This could be lost where women suffer under a finance gap and a digital gender divide because IT infrastructure, such as broadband, and IT skills are a prerequisite for engaging in online exports.

To reflect the reality that an estimated 1 billion people in the developing world have broadband but not a debit or credit card, Sicat and others argue that an enabling environment for e-commerce should include access to broadband but also to payment mechanisms.⁵⁷

Limited access to business networks is a key factor in women-owned or women-led SMEs facing specific challenges to grow or access market opportunities, and another key factor is that larger firms lack knowledge of women-owned or women-led SMEs in the market.⁵⁸ Access to resources such as business networks and to larger firms is another pathway to helping these SMEs tap into larger firms’ supply chains, which in turn can help overcome how scale is a determinant of a firm’s ability to export and unlock the benefits of participating in trade, and trade in value-added. For trade in services, such supply of services could take the form of any of the modes of supply, and it would be imperative to extend the benefits of trade in services to more sectors, including those where women tend to concentrate, and to improving female participation in GVCs.⁵⁹

The flexibility of online work can bridge the structural differences women face in terms of primary responsibility for reproductive work. Assuming online work requires fewer resources than opening a physical shop, e-commerce and digital trade can bridge women’s differential access to resources, from networks to finance. Furthermore, servicification has a potential to diversify economies, and ICT is a major component to this end. However, it presupposes education and ICT skills.

Indeed, the International Telecommunications Union reports that the proportion of women using the internet is 12 per cent lower than the proportion of men, and this gender gap widens to around 33 per cent in least-developed countries. Research also shows that in Africa, over 40 per cent of women are not able to effectively engage with digital tools for personal and professional activities.⁶⁰ Thus, women affected by a lack of access to education or the existence of a digital divide would not readily be able to take full advantage of the opportunities associated with e-commerce and digital trade. Yet, globally, reports estimate that enabling internet access for 150 million women would contribute an estimated USD 13–18 billion to the annual Gross Domestic Product (GDP) of 144 developing countries.⁶¹

6.3.1.3 Regulatory Challenges

In trade in services, barriers to trade are mostly of a regulatory nature that can be time and resource consuming to overcome, for example obtaining a licence or complying with domestic regulations, such as licensing requirements, qualifications, and technical standards.⁶² Thus, on the regulatory side, gender needs to be recognized before the law to ensure access to resources, anchored in enforceable rights. For example, without legal protection, women could risk being denied access to the financial infrastructure needed for participating in trade, such as opening a bank account or cashing cheques, or they could be denied authorization to supply a given service.

This is where disciplines on DR come into the picture. The goal of developing new enhanced disciplines pursuant to GATS Article VI:4 is to address difficulties which may be faced by services suppliers in complying with measures relating to licensing requirements and procedures, qualification requirements and procedures, and technical standards of other members. In a regime that tolerates discrimination or fails to intervene in gender inequality, women could, for example, experience not being able to obtain licences such as a permit to operate as a professional service supplier. Furthermore, women would not be able to avail themselves of regulatory frameworks that support trade.

The policies and regulations that shape the digital economy also critically shape the economic prospects of women who use it or seek to partake in it, and can have an outsized impact on women. An enabling environment with internet connection and IT systems, e-commerce logistics, online payments, skilled workforces, and an accommodating regulatory environment, are required for firms to engage in cross-border e-commerce.⁶³

In sum, it is proposed that the three key policy challenges of market access, resources, and regulatory aspects for gender-inclusive trade are interconnected, which may in effect reinforce their effect on differential access and gendered constraints to participation in e-commerce, digital trade, and services trade. The following framework for gender-inclusive governance can be devised to shape the necessary policy interventions.

6.4 Multi-level Framework for Securing Incremental Change for a Comprehensive Shift towards Gender-Inclusive e-Commerce and Trade Policy

It is the central proposition of this chapter that policy intervention can counter the gender-based constraints that impede participation of women in trade. The vehicle proposed for securing incremental change for a comprehensive shift towards gender-inclusive trade policy is a multi-level framework.

Efforts to promote gender equality for economic growth from participation in trade suggest that engaging the domestic policy level is imperative for implementation. This means focusing on implementing domestic reforms, such as those identified by the World Bank.⁶⁴ In line with this thinking, a ‘bottom-up approach’ consists of engaging the domestic policy level. Domestic reform then feeds into Regional Trade Agreements (RTAs), and in turn is informed by advancements in RTAs.

Research has mapped gender-related provisions across RTAs, showing a diversity in approaches that suggests much experience to draw from.⁶⁵ Regional trade policy instruments that have embraced provisions on gender equality include, inter alia, the FTA between Chile and Canada, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and the African Comprehensive Free Trade Agreement (AfCFTA).⁶⁶ Regional experiences with drafting, scoping, and implementing gender-related provisions and chapters, and their interplay with other disciplines, could improve gender-inclusive governance at large, and inform WTO negotiating modalities. Namely, the experience of including chapters and provisions on gender equality in RTAs would inform policy interventions in the multilateral rules-based system, on a multilateral level, or in a plurilateral setting. The plurilateral setting encompasses the JSIs, and the JSI on services DR specifically includes a provision on gender equality.

The second component to the bottom-up approach involves policy interventions in specific issues. For e-commerce and digital trade, the bottom-up approach would direct policy intervention towards the regulatory space of an enabling environment for e-commerce as the key regulatory and policy challenges facing women can be addressed in this regulatory space to overcome key challenges. The JSI on services DR encompasses policy intervention in the form of a specific provision targeting any gender-based discrimination in the authorizations for the supply of services. Specific issues and specific provisions would then lend themselves to implementing gender-inclusivity and improvement of women’s participation in other issue areas and other disciplines by way of example and of policy practice. Furthermore, the modalities would be shaped to capture the multiplicity of the gender gap.

Supporting gender mainstreaming is key to a ‘top-down approach’ to gender-inclusive trade policy. Gender mainstreaming can engage all WTO initiatives, including the JSIs, to bring about gender-inclusive economic growth in the spirit of the SDGs and in fulfilment of the aspirations of the Buenos Aires Declaration. Such an incremental approach could help ensure implementation of gender-inclusive governance across the WTO acquis and anchor gender equality in the rules-based system. Building on the JSI on services DR and its landmark provision on gender equality, and the traction the trade and gender agenda had at MC12, would contribute to consolidating the agenda and exercise policy pressure on the multilateral trading system top-down as well as on the domestic level and upwards. These efforts could build on experience from RTAs incorporating gender equality in different ways.

On an institutional level, continuous strengthening of the coordination between the WTO, RTAs, UNCTAD, the World Bank, the ITC, and the OECD on modalities for supporting the necessary multi-level coordination holds promises for advancing gender-inclusive trade policy-making. Continuous efforts to mainstream gender in trade policy are crucial for sustaining the momentum for gender equality in the WTO.

Furthermore, reading gender equality into the rules-based system could help deliver an incrementally more gender-inclusive trading system across the WTO acquis. It would also require dedicating time, resources, and political will to continuing discussions on trade and gender in the WTO. The prospect of an outcome at the MC12 seems particularly promising to this end.

Bringing the market access component of the key policy challenges for gender-inclusivity in trade to the forefront when designing and implementing gender-inclusive programmes can support accessing markets, expand and strengthen market participation, while ensuring sustained gender-inclusion. This is operationalized by employing the multi-level framework of combining a bottom-up approach centred around domestic regulations and reform, and a top-down approach revolving around commitments and policy support.

Expanding in services and digital trade requires improving conditions for participating in all modes of supply. The reverse scenario could produce the unfortunate side effect that existing patterns of limited employment and the gendered composition of labour and education are reproduced at the expense of support for women branching into digital products and services via e-commerce and digital trade.

The multiplicity of the gender gap is not fully captured across trade policy instruments – for an on point example, see the JSI outcome on DR. If committing to such a framing, it is important not to lose sight of the broader gender equality issue and its multiplicity, and to safeguard against any gender-preclusive effects.⁶⁷ Furthermore, policymakers could prepare the ground for expanding the platform to address how gender is one part of a larger socio-economic issue of de jure and de facto discrimination based on gender, sex, sexual orientation, class, race, and origins.⁶⁸

Finally, to support a comprehensive shift towards gender equality, it is strongly recommended to continue the effort to collect more data on all aspects of e-commerce, digital trade, trade in services, and trade at large to support policy-making and implementation of gender-inclusive governance.⁶⁹ Collecting data on implementation and the effect of the concluded disciplines on DR, including the provision on gender equality, would lend itself to an uptake in data and support policy-making.

6.5 Policy Intervention to Bridge the Gender Digital Divide

The WTO does not yet offer a comprehensive multilateral response to the digitalization that drives digital trade and e-commerce. However, MC11 saw much more policy attention directed to e-commerce as seventy-one members launched the Joint Statement Initiative on Electronic Commerce (JSI on e-commerce)⁷⁰ to initiate exploratory work towards future WTO negotiations on trade-related aspects of e-commerce.⁷¹

If coupled with the trade and gender agenda, the JSI on e-commerce would be in line with the thinking behind the multi-level framework’s bottom-up policy intervention in specific issues, and its top-down approach to securing incremental change towards gender-inclusive e-commerce and trade policy. Furthermore, it is the central argument that applying the framework to the modalities shaping e-commerce rules could help secure gender-inclusive e-commerce governance. Recalling the structural differences women face in terms of labour, time, and resources,⁷² e-commerce provides flexibility in structuring participation in trade, new markets for employment, and pathways to control over online resources that may be cheaper than traditional business. This suggests a tangible potential for incorporating gender equality into e-commerce rules to form gender-inclusive e-commerce governance. However, it will take effort and policy commitment to overcome the gender digital divide and other aspects of the gender gap given gender-based constraints and differential access to prerequisite resources. In the absence of policy intervention, an acceleration of digitalization could deepen the gender digital divide, which in turn could reverse the status quo for participation in e-commerce and digital trade and lead to backsliding.

Factoring in the domestic aspect is important for participation in e-commerce because 90 per cent of e-commerce is in fact domestic commerce.⁷³ Moreover, it is necessary to overcome the divides to upscale a firm to an operation with the resources to export cross-border. Compatibility between domestic, regional, and multilateral frameworks to advance comprehensive gender-inclusive governance would be instrumental to that end.

Achieving a predictable regulatory environment for e-commerce and digital trade could link with incorporating gender equality into DR because service suppliers engaged in cross-border e-commerce might rely on obtaining licences and authorizations when meeting the requirements, regardless of gender, and the predictability of the regulatory environment would improve in consequence.

Embedding these issues within a framework for e-commerce and digital trade that connects with other trade policy agendas would drive more comprehensive implementation of gender equality into trade policy. The JSI points out that a link exists between MSMEs and e-commerce and that furthering gender equality in this nexus could be particularly beneficial for women’s participation and for development. This platform could be used for providing the key access to finance, which also hinges on domestic regulation and reform.

Seeking to embed gender equality even more firmly within the MSME agenda as a development issue and connecting it to e-commerce could be anchored within Aid for Trade, where gender-inclusive initiatives can target the obstacles that women face when trading. The rapid development of technology enabling e-commerce and digital trade, while ensuring that it is gender-inclusive, promises more opportunities for women beyond the sectors where most women currently find employment or work, and could be anchored in enabling environments for e-commerce and digital trade at large.

6.5.1 Gender-Inclusive e-Commerce Governance

Gender-inclusive e-commerce governance aims to narrow the gender gap by overcoming the digital divide, the finance gap, and how they intersect with scale.⁷⁴ Gender-inclusive e-commerce governance addresses the key regulatory challenges of market access, access to resources, and regulatory aspects to participating in e-commerce.

Domestic policy commitments to gender equality in both the exporting country and the importing country could help leverage and upscale domestic e-commerce into cross-border e-commerce. This would improve market access with positive benefits. First, it could offset some of the vulnerabilities in the economy associated with women being concentrated in fewer sectors, and facing gendered job segregation.⁷⁵ Secondly, evidence suggests that women increase sales volume and profits when selling to destinations further from their home country rather than over a single border.⁷⁶ Access to new markets through exports could help abate some of that vulnerability and overcome the norms or structural features that produce gender discrimination and differential access.

As for access to resources, even where participation in e-commerce on a small scale is less costly or requires less financing, it would still require a backbone of IT infrastructure and financial infrastructure, such as internet access and skills, e-payment systems, and access to a bank account. IT infrastructure and financial infrastructure, including payment mechanisms, are components for an enabling environment that could have a real impact in helping women to overcome the disadvantages they face in responding to new economic incentives because of gender differences in access to resources, such as those needed for participating in e-commerce.

Thus, once again the prospect of economic empowerment from participating in e-commerce is defined by access to the prerequisites for e-commerce, such as holding a bank account, and to designing rules that establish an enabling environment that helps women respond to new economic incentives, namely access to finance and IT skills. Securing access to IT skills and finance, in particular, could improve gender equality in the digital market, and the chances that e-commerce and digital trade deliver on the promise of inclusive economic growth.

Women’s opportunities in new economic activities are dampened by time constraints,⁷⁷ and thus easing regulatory barriers and improving the regulatory environment, which can be time and resource consuming, could have a positive effect on participation at large and, by implication, also on gender-inclusive e-commerce governance. The ongoing JSI on e-commerce encompasses disciplines and provisions on transparency, non-discrimination, ensuring a predictable regulatory environment, and shaping an enabling environment for e-commerce.

It is the central argument that incorporating gender equality into the e-commerce rulebook could result in positive change towards gender-inclusive governance. Transparency improves accountability, and by extension lends itself to gender-inclusive governance,⁷⁸ while non-discrimination is key to levelling the playing field. Achieving a predictable regulatory environment for e-commerce also lends itself to gender-inclusive e-commerce governance. If it were to link with incorporating gender equality into DR, service suppliers engaged in cross-border e-commerce and digital trade would then rely on obtaining licences, regardless of gender, and the predictability of the regulatory environment would improve in consequence. Finally, there are rules to establish an enabling environment, and they could have an outsized effect on operationalizing gender-inclusive e-commerce governance. The multi-level framework’s bottom-up approach to specific disciplines advises exploring the potential for gender-inclusive e-commerce to shape the regulatory space for an enabling environment.

6.5.2 An Enabling Environment for e-Commerce

Elements of an enabling environment to facilitate online transactions were introduced into discussions at the WTO.⁷⁹ The 2019 European Union proposal for WTO disciplines and commitments relating to electronic commerce, stipulates in Article 1, ‘The EU supports the open, transparent and inclusive character of these negotiations’.⁸⁰

Gender equality could be injected into the proposal’s provisions on an enabling environment in Article 2. A provision obliging members to ensure that there is no discrimination based on gender when issuing licences and authorizations could be incorporated into Article 3.6,⁸¹ drawing on lessons learnt from the changing language in DR.⁸²

Injecting gender equality into the modalities for an enabling environment in e-commerce discussions could be approached by outlining how enjoying rights, having effective redress, protection from discriminatory practices, and transparency form part of such an environment, and by emphasizing international cooperation and coordination with other national and regional bodies to this end. Thereby an enabling environment for e-commerce would be created, with regulatory space conducive to gender equality. Prescriptive measures for adopting and maintaining measures that contribute to closing the gender gaps would be coupled with a gender-inclusive prohibition against discrimination based on gender and embedded within the modalities for e-commerce.

6.6 Policy Intervention to Bridge the Gender Gap in Services Trade

With most barriers to trade in services being of a regulatory nature and non-tariff-related, the role of domestic regulation and measures over the border in the country receiving the supply of services by any of the means becomes even more important to services trade. Research by the WTO and OECD suggests that the reduction in trade costs from implementing the new disciplines included in the sixty-seven members’ landmark conclusion of an agreement on services DR of 2 December 2021 could amount to USD 150 billion per annum globally, with particularly important gains for financial, business, communications, and transport services.⁸³

Further to the disciplines in GATS Article VI, the GATS also establishes the mandate for negotiating additional disciplines in GATS Article VI:4.⁸⁴ The provision stipulates that, with a view to ensuring that measures relating to qualification requirements and procedures, technical standards and licensing requirements do not constitute unnecessary barriers to trade in services, the Council for Trade in Services shall, through appropriate bodies it may establish, develop any necessary disciplines. Such disciplines shall aim to ensure that such requirements are, inter alia: (a) based on objective and transparent criteria, such as competence and the ability to supply the service; (b) not more burdensome than necessary to ensure the quality of the service; and (c) in the case of licensing procedures, not in themselves a restriction on the supply of the service. Thus, pursuant to GATS Article VI:4, members agree to further develop rules to ensure that domestic regulations support rather than impede the opening of services markets to trade and investment as a central task for services negotiations.⁸⁵

As the reference paper on services regulation explains,⁸⁶ members would agree to the disciplines on DR with the objective of elaborating upon the provisions of GATS pursuant to Article VI:4. In doing so, members recognize the difficulties which may be faced by service suppliers, particularly those of developing country members, in complying with measures relating to licensing requirements and procedures, qualification requirements and procedures, and technical standards of other members, and, in particular, the specific difficulties which may be faced by service suppliers from LDCs.

The JSI on services DR is more advanced than the JSI on e-commerce in two ways: first, the JSI on services DR has concluded an agreement, and second, it includes a specific provision on gender equality. These advancements reflect the multi-level framework’s bottom-up approach to policy intervention on specific issues, and its top-down approach to securing incremental change towards gender-inclusive e-commerce and trade policy, and indicate a pathway to gender-inclusive governance for services trade.

DR disciplines are for trade in services sectors positioned to address the regulatory component to the key policy challenges of market access and differential access to resources that women face, as DR disciplines regulatory measures in order to level the playing field.⁸⁷ The need for recognition before the law, evidence of gender bias adversely affecting women, and many new opportunities for employment outside the existing gendered composition of the labour force make DR all the more important for women’s economic participation in the supply of services. Such supply often requires a licence or authorization. Thus, DR disciplines are key to economic participation in services trade, and are well positioned to shape the modalities for gender-inclusive trade in services, also spanning the services components to e-commerce and digital trade, where commitments have been made.⁸⁸

6.6.1 Negotiating Modalities for Development of Measures on Domestic Regulation pursuant to GATS Article VI:4

In pursuit of an outcome on DR at MC11, the Friends of DR circulated a communication, dated 7 November 2017, to the members of the Working Party on Domestic Regulation (WPDR).⁸⁹ Among other provisions, under the DR GATS Article VI:4 mandate, the text includes provisions on measures relating to licensing requirements and procedures, qualification requirements and procedures, and technical standards. This section also includes a provision on gender equality originally tabled by Canada. In 2016, Canada had previously included the exact provision in the DR text during negotiations on the Trade in Services Agreement (TiSA).⁹⁰

At the time of MC11, the DR proposal on gender equality for the WPDR read (the 2017 WPDR text):

Gender Equality

6.2 Where a Member adopts or maintains measures relating to authorisation for the supply of a service, the Member shall ensure that such measures do not discriminate against individuals on the basis of gender.

[Footnote: For greater certainty, legitimate differentiation, which means differential treatment that is reasonable and objective, and aims to achieve a legitimate purpose, and adoption by Members of temporary special measures aimed at accelerating de facto gender equality, shall not be considered discrimination for the purposes of this provision.]

At MC11, the Friends of DR were not successful in securing an outcome in the shape of multilateral agreement under the built-in mandate. Instead they secured support for the JSI on services DR.⁹¹ The initiative (JSI) operates on a plurilateral basis, and has continued discussions outside the WPDR since MC11.

The JSI’s text on gender equality was adjusted to the following stipulation (the 2018 JSI text):⁹²

Development of Measures

If a Member adopts or maintains measures relating to authorisation for the supply of a service, the Member shall ensure that: …

[(e) such measures do not discriminate between men and women.

[Footnote: Differential treatment that is reasonable and objective, and aims to achieve a legitimate purpose, and adoption by Members of temporary special measures aimed at accelerating de facto equality between men and women, shall not be considered discrimination for the purposes of this provision.]].

When comparing the 2017 WPDR text with the 2018 JSI text, a change in the structure of the provision is evident, but it also embodies an evident change in wording.

The JSI proceeded to stabilize a text on DR in preparation for a plurilateral outcome coinciding with MC12 with the support of sixty-five members (the 2020 JSI text).⁹³ The provision on gender equality carries on the changes introduced with the JSI 2018 text, when it stipulates:

SECTION II – DISCIPLINES ON SERVICES DOMESTIC REGULATION …

Development of Measures

22. If a Member adopts or maintains measures relating to the authorization for the supply of a service, the Member shall ensure that: …

[; and

(d) such measures do not discriminate between men and women.

[Footnote: Differential treatment that is reasonable and objective, and aims to achieve a legitimate purpose, and adoption by Members of temporary special measures aimed at accelerating de facto equality between men and women, shall not be considered discrimination for the purposes of this provision.]]

Compared to the 2018 JSI text, what is new to the JSI 2020 text is the inclusion of alternative disciplines on DR for Financial Services. These disciplines include a twin-provision on non-discrimination between men and women:

[SECTION III – ALTERNATIVE DISCIPLINES ON SERVICES DOMESTIC REGULATION FOR FINANCIAL SERVICES …

Development of Measures

19. If a Member adopts or maintains measures relating to the authorization for the supply of a service, the Member shall ensure that: …

[; and

(d) such measures do not discriminate between men and women.

[Footnote: Differential treatment that is reasonable and objective, and aims to achieve a legitimate purpose, and adoption by Members of temporary special measures aimed at accelerating de facto equality between men and women, shall not be considered discrimination for the purposes of this provision.]]

The change in language from the 2017 WPDR text to the 2018 JSI text encompasses non-discrimination ‘between men and women’, rather than ‘against individuals on the basis of gender’. The change in language carries legal consequences as it effectively changes the scope of the obligation. Both proposals turn on the notion of non-discrimination, likely with the intention in mind to discipline de jure discrimination based on gender when applying for authorization, and perhaps with less regard for de facto discrimination. The definitions vary, however, and, by implication, so does the scope of those protected individuals under the imperative of ‘shall ensure’. In essence, the 2018 and 2020 JSI texts have been watered down to a binary categorization, compared with the broader term ‘gender’, used in the 2017 WPDR text, which did not make such a pronouncement.

On 27 September 2021, participants in the JSI on Domestic Regulations concluded text negotiations, on track for MC12, and proceeded to circulate national schedules of commitment pursuant to GATS.⁹⁴ Despite the postponement of MC12, on 2 December 2021 negotiators reached an agreement among the JSI’s now sixty-seven WTO members.⁹⁵ Except for the removal of brackets, the final text⁹⁶ is identical to the JSI 2020 text, and so it locks in the binary wording of ‘between men and women’ that first appeared with the 2018 JSI text, at the expense of the 2017 WPDR text’s gender-inclusive language, ‘on the basis of gender’.

6.6.2 Legal–Political Implications of the Domestic Regulation Discipline on Gender Equality

As a wider concept that reflects the multiplicity of the gender gap, the use of ‘gender’ does not preclude any gender from the scope of protection against discriminatory domestic measures.⁹⁷ The scope of a provision on gender equality that obliges members to ensure that domestic measures do not discriminate based on gender, should ideally capture the multiplicity of the gender gap and be gender-inclusive to economic participation. Whether a provision such as the one included in the 2017 WPDR text would yield results to that effect would depend on interpretation and implementation. Yet it is a given that such wording of a provision on gender equality lends itself to that end and comes much closer to fulfilling the aspirations of gender-inclusivity as it can also reflect the multidimensional nature of the gender gap and the multiplicity of the gender gap.

Though several policy tools, such as the Buenos Aires Declaration on Women and Trade, turn on the notion of uplifting women’s participation in trade, they form part of a larger trade and gender agenda that top-down promotes gender mainstreaming in trade policy. However, the JSI 2021 text employs a binary, biological identification of sex as a man or a woman and locks in a binary wording that contrasts women and men.

Viewed through the lens of the framework for gender-inclusive governance, the concern is, for one, that the binary wording can be employed to exclude or legitimize excluding those that do not identify with it. Secondly, the binary wording does not immediately lend itself to reflect the multiplicity of the gender gap or its multidimensional occurrence.

The revised proposal fails to protect from discrimination those that are deemed outside the scope of ‘women’, in the sense of the sex. It is problematic to not include every gender in an improvement based on non-discrimination because, while it uplifts women, it leaves those that are not captured by the improvement at the status quo. While it may be a function of the trading landscape that policymakers had to navigate in order to conclude complicated negotiations, such an approach falls short of the aspiration of gender-inclusivity. A deeper concern would be that language effectively precluding some could produce gender-precluding results, even resulting in backsliding for those excluded. The binary wording could even be (mis)used to legitimize or promote an interpretation that excludes LGBTQ+ from protection against discriminatory measures relating to authorization for the supply of services.

Furthermore, the wording seems to rest on the flawed assumption that all men have better access to resources and fewer constraints to participating in the supply of services than women do. Employing ‘men’ as the comparator for non-discrimination is problematic for operationalizing the provision because individuals who are biologically of the male sex may also be socially vulnerable and face differential access to opportunities in trade because of socio-economic stratification, for example based on origins. In practice, this could undermine the implementation of the provision as stipulated in the 2021 JSI texts, which would also be a disservice to those immediately within its scope.

The footnotes included in both proposals seek to clarify ‘discrimination’ to ensure the legality of differential treatment that is reasonable and objective, and aims to achieve a legitimate purpose, and adoption by members of temporary special measures aimed at accelerating de facto equality between men and women. It is reasonable to assume that the footnote is intended to, for example, safeguard domestic measures involving services authorization that encompass affirmative action. The footnote then establishes criteria that such domestic measures are to meet for the differential treatment not to be considered the kind of discrimination that the provision obliges members to protect against. The criteria of reasonability, objectivity, and legitimacy apply to differential treatment, but not to temporary special measures aimed at accelerating de facto equality between men and women.

As for the footnote’s first part on differential treatment, an issue may arise if a member who has made commitments under the provision enacts affirmative action directed at men and socio-economic attributes specific to them. If, for example, such a member enacted domestic measures relating to authorization to intervene in the disadvantage of precarious or dangerous employment in the mining sector, which, for the purpose of this experiment, is assumed to be exclusively male, it would be problematic if such a measure could be struck down as incompatible. However, interpretation that looks to the aim of the provision would supposedly ensure the compatibility of such a measure.

As for the footnote’s second part, an issue would arise if a special measure aimed at accelerating de facto equality between men and women is not of a temporary duration. This issue could be harder to reconcile, firstly, because ‘temporary’ is left to interpretation and, secondly, because some domestic measures may be designed to correct engrained inequalities, which takes time. Viewed through the lens of the framework for gender-inclusive governance, which specifically emphasizes the importance of domestic reforms and of compatibility, in this sense, and because it reproduces the binary wording, the footnote leaves room for improvement.

Still, by implication of the exclusion from the definition of ‘discrimination’, the footnote can protect policy tools such as positive discrimination and affirmative action aimed at accelerating de facto gender equality from being struck down as incompatible with the DR discipline. In effect, the clarification reads like a policy space reservation that ensures the legality of domestic affirmative programmes that meet the criteria.

This is crucial for two reasons. First, the disciplines of DR are aimed at domestic law and regulations, behind the border, so the legality of domestic measures of this kind need to be secured. Second, the World Bank has collected and analysed data on the effect of domestic laws and regulations on limiting women’s economic participation, citing research that calls into question the notion that economic growth alone increases gender equality when rather continuous policy commitments to gender equality are required to achieve the goal.⁹⁸ The report establishes how domestic reform is key to improving conditions for women’s participation in economic activities, including cross-border.⁹⁹ Arguably, incompatibility with WTO law of domestic reforms to narrow the gender gap would undermine such efforts. Third, more broadly speaking, ensuring compatibility between domestic, regional, and multilateral frameworks is key to advancing comprehensive gender-inclusive governance.

The same criticisms apply to the reproduction of the binary wording in Section III’s alternative disciplines on domestic regulation for financial services. This is where it is advised to counter any adverse effect on women of trade reform and to include safeguard provisions.¹⁰⁰

That being said, the value of the policy intervention that the provision embodies is two-fold. First, the provision on non-discrimination goes to the very heart of access to finance and banking which is a main driver among the key challenges identified with regard to women’s differential access to resources.¹⁰¹ Second, the sectoral focus shines an important light on the importance of financial services as they are a prerequisite to any form of trade, across all four modes of supply of services, to e-commerce and to digital trade.¹⁰² Thus, the addition is quite promising for narrowing the gender finance gap.

In sum, the multi-level framework helps show how the provision on gender equality included in the WPDR 2017 text with its gender-inclusive language is preferable over the provision included in the JSI 2021 text that was agreed upon because the WPDR 2017 policy intervention is directed at a deeper level. This would have a positive effect on a wider array of implications of differential access and constraints in services trade, and as it better reflects the multiplicity of gender inequalities. Furthermore, the framework shines a light on how the agreed provision leaves room for improvement in terms of addressing the multidimensional nature of the gender gap, and to what effect de facto. While it seems to aim squarely at de jure discrimination when applying for an authorization, while de facto discrimination is wrapped up in a less-than-ideal footnote.

However, the 2018, 2020, and now the concluded 2021 JSI texts’ provision is positioned to build on the significant traction for women’s participation in trade at this moment of renewed commitments to the trade and gender agenda at MC12. The platform provided by the JSI 2021 outcome can help application incrementally reflect the many dimensions of and multiplicity of gender gaps and ensure its rooting in gender-inclusivity. Provided that gender-preclusivity does not lead to backsliding, eventually the approach locked in with the 2021 JSI text would yield results incrementally, specifically for women. However, building on this traction and the anchoring in trade regimes, under the multilevel framework the measures could incrementally expand to produce positive effects from participation in trade in line with the aspirations of gender-inclusivity.

The promise of the provision depends on implementation though, and for services DR implementation involves bottom-up implementation domestically, as well as technical implementation in the GATS schedules of specific commitments given the modalities of the JSIs in general and given the specifics of the JSI on services DR.

6.6.3 Scheduling Modalities

What is new in the 2020 JSI text, compared to previous iterations, is the following paragraph 9 on sectoral coverage and scheduling:

SECTION I

Sectoral Coverage and Scheduling Modalities

7. Members shall inscribe the disciplines in Section II in their Schedules as additional commitments under Article XVIII of the Agreement. Members may choose to inscribe the alternative disciplines in Section III for their commitments in financial services.

8. The disciplines inscribed pursuant to paragraph 7 of this Section apply where specific commitments are undertaken. In addition, Members are encouraged to inscribe in their Schedules additional sectors to which the disciplines apply.

9. [Members may exclude the discipline set out in paragraph 22 (d) of Section II and paragraph 19 (d) of Section III from the additional commitments scheduled under paragraph 7 of this Section].

Sectoral coverage and scheduling follow particular modalities. As Section I, paragraph 7 outlines, WTO members shall inscribe the disciplines in Section II in their schedules of commitment as additional commitments under GATS Article XVIII. Members may choose to inscribe the alternative disciplines in Section III for their commitments in financial services.

Except for the removal of brackets, the final text in JSI 2021 is identical to the JSI 2020 text, and so it also locks in paragraph 9’s opt-out, which first appeared with the JSI 2020 text.

Paragraph 8 stipulates how the disciplines inscribed pursuant to paragraph 7 apply where specific commitments are undertaken. In addition, members are encouraged to note in their schedules additional sectors to which the disciplines apply. However, in effect paragraph 9 introduces an opt-out by allowing a member to avoid the two provisions on non-discrimination between men and women when scheduling additional commitments pursuant to paragraph 7. This is a very unfortunate development in the text because of several legal-political implications. First, it creates a back door which undermines the standard-setting effect of the discipline. Second, allowing for an opt-out could be construed as almost legitimizing any discrimination or gender-exclusive effects causing backsliding. Third, it could be an unfortunate precedent that runs counter to the aspirations for incremental change set out in Section 6.6.2. Therefore, the opt-out included in the agreed JSI 2021 text is a hard pill to swallow.

The silver lining is, first, that it can also be used by members implementing domestic reforms who are concerned that affirmative action and special measures to accelerate gender equality that are not outright temporary in nature are protected from being struck down as incompatible. It seems counter-intuitive but perhaps it is to the benefit of such advancements. Second, it also lends itself to those that find the binary wording irreconcilable with domestic policy, or whose gender-inclusive domestic reforms in other ways cannot be reconciled with the binary provision and its implications.

The specific schedules of commitments are integral to scheduling market access, and to operationalizing new rules, such as the provision on gender equality. Time and policy practice will show how members inscribe their additional commitments in accordance with the agreement in their GATS commitments. Hereafter, they will apply on an MFN basis. Time and policy practice will also shed light on how commitments to ensuring non-discrimination between men and women in relation to authorizations for supply of services are implemented in domestic regimes. Once implemented in domestic regimes, generally speaking, such rules would apply to all within their jurisdiction and scope.

Thus, despite its flaws and the opt-out, the provision is set to discipline and generate value for the services sectors covered by it. Furthermore, where commitments are made, it is set to affect the reduction of barriers in services that may have a spill-over effect as those services form part of e-commerce or digital trade. Policy-wise, beyond MC12, it might strengthen the agenda and energize further advancements on gender equality. The developments so far allow for extrapolating important lessons – positive as well as negative ones – that can serve as fuel across the multi-level framework for the advancement of gender-inclusive e-commerce governance.

Indeed, factoring in existing and accelerating gender gaps, including the gender digital divide implicating e-commerce and digital trade, and the risk of producing gender-exclusion is imperative to improving policy practice. Therefore, it is the central argument that it takes multi-level dedicated gender-inclusive governance to make advances in closing the gender gap.

6.7 Conclusions

Gender-inclusive governance responds to the multiplicity of the gender gap, and how it is a multidimensional concept in the nature of its occurrence, the dynamics of its development, and the manifold ways it interrelates with other divides.

The relationship between gender divides, e-commerce, digital trade, and trade in services can be observed through the lenses of the different modes of supply and in trade patterns. The relationship reflects key policy challenges to participation in that trade – market access, resources, and a regulatory component. Moving towards gender-inclusive governance for e-commerce, digital trade, and trade in services is imperative for sustainable trade policy as digitalization can serve to fuel women’s participation in trade, but in the absence of policy interventions, a deepening of the gender digital divide could have negative effects on gender inequalities.

The proposed multi-level framework shows the regulatory space for gender equality in creating an enabling environment for e-commerce and digital trade, and for incorporating gender equality into the new and enhanced regulatory layer of DR disciplines for trade in services.

What policy interventions are necessary, and why, to meet the moment? This chapter proposes a multi-level gender-inclusive framework for comprehensive narrowing of the gender gap in trade. Addressing the global, structural issue of gender inequality with multi-level approaches to the negotiating modalities, coupled with gender-inclusive governance for e-commerce, digital trade, and services trade, can contribute to closing the gender gap. E-commerce and digital trade alone, despite the promise of digitalization, cannot close the gender gap in trade. Services trade is ubiquitous and an extremely important area of trade that gender-inclusive governance could unlock to the benefit of gender equality. Examining trade in services also point squarely to the role of regulatory barriers and their interconnectedness with market access and access to resources. Disciplining DR pursuant to GATS Article VI and new disciplines pursuant to Article VI:4 may address this head-on. The provision on gender equality has been reduced to its detriment but it still shows a way forward and allows for important lessons that can inform gender-inclusive governance for trade when seizing this moment.

Leveraging the multi-level framework, and extrapolating lessons from policy practice, namely the concluded provision on gender equality in the JSI on services DR, could foster gender-inclusive governance. In that regard, the WTO and its JSIs could help deliver on the imperative of SDG 5 to achieve gender equality and turn high stakes into high reward for its members.

7 Setting Up the Table Right Women’s Representation Meets Women’s Inclusion in Trade Negotiations

Maria V. Sokolova and Matthew Wilson ^*

7.1 Introduction

Over the course of the last two decades in particular, trade negotiations have increased in scope, scale and complexity, involving more experts, negotiators and diplomats. This has resulted in additional pressure on smaller developing countries that often have either a limited complement of staff in missions or have only non-resident representation in Geneva, which is the seat of multilateral trade negotiations at the WTO. Furthermore, the increasingly technical nature of trade negotiations can also place a strain on national expertise which is necessary to inform, backstop and support the negotiating process. The evidence confirms that trade missions from small island developing states (SIDS) and least-developed countries (LDCs) have a much lower staff complement, and in turn fewer women, than the average in the UN or the WTO missions in Geneva.¹ This can impact the ability of these economies to represent their interests in all relevant aspects of the negotiating agenda. This chapter looks at the representation of women in multilateral trade negotiations, specifically in the context of the WTO, and places it in the context of the overall goal of achieving more gender-sensitive outcomes from trade policy.

An important question is whether the gender make-up of representation has an impact on gender-sensitive outcomes emanating from trade negotiations. Recently it was recognized by the WTO members that trade has an important gender element. But the actual question is whether it has been a result of changing global norms around gender mainstreaming and gender inclusion or is a reflection of more gender-equal representation across the trade landscape – nationally and at the level of the missions in Geneva.

References to gender are present in some of the existing trade agreements,² and at the 11th Ministerial Conference held in Argentina in 2017, some WTO members, supported by the work of the International Trade Centre (ITC) and other actors, agreed to the Buenos Aires Declaration on Trade and Women’s Economic Empowerment.³ Ahead of Ministerial Conference 12 (MC12), gender seemed to be one of the key topics to see significant advancement.⁴ At MC12, held in June 2022, we saw the highest number of women present at the negotiations – negotiating for food security, health and other themes of trade policy. Yet the term ‘gender’ was absent from the key negotiated outcomes. There was some progress made on the outskirts, and a side event, ‘Unlocking Trade for Women’s Empowerment and Sustainable Development’, discussed the operational issues of trade and gender, such as the need to ensure trade and trade agreements contribute to greater gender equality through enhancing gender-sensitive data, better gender-based reporting and greater attention to women owned micro, small and medium-sized enterprises (MSMEs). But the ‘side-ness’ of the event indicates that we have still a long way to go.

While some of the trade agreements do include gender provisions and chapters, and there is momentum to take this further, it is worth looking at the process involved in concluding a trade agreement and ask how women are represented in those trade negotiations and whether greater representation translates into more gender-sensitive outcomes. The existing research on causality is limited but we provide a framework to analyse how, and at what stages, women are part of the negotiating value chain and survey the current representation of women in trade negotiations in Geneva. We argue that, while women’s representation has a positive impact on trade negotiations, it should not be seen as a substitute for active inclusion of gender considerations in negotiated trade policy. There is a lack of literature and data on representation of women in the trade negotiation cycle, which we have sought to partly address by collecting data on the gender composition of the UN and the WTO missions and conducting confidential interviews with women and men involved throughout their careers in trade negotiations. While the names of interviewees will remain confidential, the authors have ensured geographic, gender and thematic diversity of persons interviewed.⁵

This chapter is organized as follows: Section 7.2 covers the changes in the nature of trade negotiations and how this has affected the demands on negotiators; Section 7.3 provides collected gendered data on the staff composition of the UN and WTO missions, showing diverging representation among member states; Section 7.4 highlights the importance of networks in supporting the job of a trade negotiator and how gendered socio-economic systems have historically placed women at a disadvantage for such positions; Section 7.5 binds together the altered nature of what trade negotiations are and which challenges women face in trade negotiations as a career choice. Section 7.6 highlights the importance of making a distinction between women participating in trade negotiations and the interests of women being included in trade negotiations. In Section 7.7, we analyse women’s representation as a tool for gender equality. We conclude the chapter, in Section 7.8, with a set of actionable suggestions that can improve the inclusion of issues around women in trade negotiations.

7.2 Trade Negotiations Have Expanded in Scale and Scope

Trade negotiations have expanded in scale, scope and depth.⁶ Trade negotiators are increasingly expected to contribute technical and multidisciplinary input and expertise and/or to be able to galvanize these technical inputs from their capital-based experts. New trade agreements tend to build on the already complex scope of agreements under the WTO or in existing bilateral agreements, hence sometimes forcing newcomers to the trade negotiation game to follow the lead that has already been set.

This is particularly the case for smaller countries which may naturally be party to less complex trade negotiations at the bilateral or regional levels. However, it is worth noting that since 2016, every WTO member has been a member of at least one regional trade agreement.⁷ This certainly signifies an explosion in the number of negotiations that would naturally have to precede completed trade agreements – both non-WTO and WTO – even though there are different levels of complexities to consider.

The vast majority of the agreements concluded outside of the WTO have been ‘WTO-plus’ – meaning that they go deeper than already existing trade agreements at the WTO. Quite often the ‘plus’ relating to discussions that also happen inside the WTO with a more limited set of countries involved in plurilaterals such as investment, elements of environment, services, gender and others.⁸ The reasons for this are rather obvious: fewer partners to negotiate with; a more like-minded approach between partners; and the ability to develop agreement-specific implementation, monitoring and dispute systems. The expectation is that every WTO member will notify its trade agreements to the WTO to ensure that it does not violate the existing multilateral commitments.⁹

However, the reality can be a bit more complex given the tension between the notions of ‘globalization’ (through the WTO) and ‘regionalization’ (through regional trade agreements – RTAs) of trade liberalization.¹⁰ For the past decade – accelerated by limited success at concluding multilateral agreements (with the Trade Facilitation Agreement and recent Fisheries Subsidies Agreements being exceptions) and emergence of more plurilateral negotiations at the WTO – the balance has shifted from ‘ideological competitors’ to ‘complementary allies.’ Views on regionalization have matured from being seen as undermining trade globalization, to now being viewed as an extension of trade globalization moving the needle forward and complementing the WTO rules.¹¹ RTAs are now accepted as avenues for deepening trade liberalization and informing the scope and ambition of multilateral agreements. We are seeing this happen in the area of gender and trade, e-commerce and investment facilitation.¹²

Trade is widely seen as one of the main vessels for inclusive and sustainable growth. It permeates the United Nations Sustainable Development Goals (UN SDGs)¹³ and during the COVID-19 pandemic it was key to vaccine distribution.¹⁴ Ideological differences still persist on what ‘kind’ of trade is best for the environment, equality and sustainability, but there is growing recognition that it does have divergent effects on men and women.¹⁵ A growing number of RTAs now include gender chapters.¹⁶ However, these chapters are primarily persuasive in intention as in general they do not have enforcement mechanisms attached to them.¹⁷ At the same time, if one takes a deeper look at the 2017 Buenos Aires Declaration, it has pushed the needle forward by leading to the formation of an Informal Working Group (IWG) on Trade and Gender in the WTO.¹⁸ This group addresses trade and gender issues by encouraging members to exchange practices on mainstreaming gender considerations into programmes and strategies and increase gendered data collection, amongst others.¹⁹

Given this increased attention to gender in trade, one can expect that modern trade policy would become more gender-equal not only in its effects, but also in its creation.

Based on the interviews conducted for this chapter, we can conclude that in trade negotiations, women’s representation has often been a proxy for ‘having women’s voices heard’, and therefore more gender-inclusive policy proposals being created throughout the negotiations. We argue, however, that women’s representation in trade negotiations, while having a positive effect, should not be confused with inclusion of issues of importance to women in the context of trade negotiations and agreements – that is, a result that leads to a more gender-equalizing effect of negotiated trade policy.

Women’s representation is a necessary, but not a sufficient condition for a more gender-inclusive trade policy. Gender inclusion is a responsibility of all genders, and although it is ideal to have all of these genders involved in the crafting of gender-sensitive trade policies, as a second-best option it can be assumed that men would be able to sufficiently represent the interests of women with the right tools at hand. However, in the twenty-first century, this scenario is far from ideal.

7.3 Ability to Participate in Negotiations Varies

It is difficult to obtain information on women’s representation in the process of trade negotiations, as quite often this information is confidential, or it is hard to estimate who is engaged in trade negotiations, and at what point. As most of the multilateral trade discussions are led by Geneva missions, we use Geneva for our data collection exercise to survey the overall picture on women’s involvement in trade negotiations.

According to data we collected,²⁰ there are 182 missions to the UN in Geneva, and 175 missions to the WTO. The average size of professional staff in a UN mission is ten people, but with a wide range of one person to seventy people. Of the total staff in UN missions, 37 per cent identify as women. Remarkably, the average WTO mission – sometimes a subset of the larger UN mission – is six people, ranging from one to thirty people, and with 40 per cent identifying as women. This signals that there is similar attention, on average, given to trade representation in Geneva as there is to humanitarian affairs, human rights, health, labour and so on combined. It is worth recalling that discussions at the WTO also now cover the environment, gender, health and other topics. This is supported by the fact that in the case of 105 countries,²¹ the mission carries out a double function – meaning that the head of the delegation leads both the mission to the UN and to the WTO.

Amongst others, the following conclusions can be drawn from the data presented in Table 7.1:

• – On average, the size of the WTO mission of a country is almost half the size of the UN mission. This illustrates the fact that Geneva, while being a regional UN headquarters and centre for many other discussions, is also seen as a global centre of multilateral trade negotiations;

• – Every two out of three missions in Geneva double as both mission to the UN and mission to the WTO, which implies that they do not concentrate solely on trade issues;

• – It is no surprise that the countries of the Organisation for Economic Development and Co-operation (OECD), developed countries, industrialized countries and high-income countries have larger UN and WTO missions than other subgroups of countries;

• – Women are present at a rate of under 50 per cent in both UN and WTO mission staff, but score over 30 per cent for almost all subgroups;

• – Women are present less frequently than men as heads of WTO delegations in the missions of industrialized countries, with low- and high-income countries having the lowest share;

• – Europe and North America have 50 per cent larger UN missions than the rest of the world, but the difference is much smaller for the WTO missions; Asia also has larger UN missions than average (18 per cent), and the largest trade missions (20 per cent larger).

• – Regarding women’s representation, Asia and Africa have on average fewer women present in the missions, but Latin America and the Caribbean and Asia have the lowest share (24 per cent) of women heads of WTO missions.

• – Irrespective of groupings, women are on average less present in WTO missions than men.

While we are only able to collect information on the Geneva diplomatic sphere and hence may not capture the gender make-up of the capital and regional counterparts of trade diplomacy, it is still telling that women from all regions are underrepresented in Geneva, which is the epicentre of the multilateral trading system. Altogether, these facts paint a very complex picture of Geneva diplomacy. There are currently 516 active RTAs,²² with 17 RTAs notified to the WTO in the first half of 2021.²³ At the same time, the WTO itself has a complex structure with at least thirty-three active committees, councils or working groups (aside from the dispute settlement processes). As Geneva is considered a capital of trade policy, it is useful to look at the sheer number of meetings facilitated by the WTO and the UN Conference on Trade and Development (UNCTAD), which on average can reach more than 1,000 per year, with a common occurrence of 4–5 meetings a day. In addition, there are bilateral meetings, lobbying and some cross-issue meetings in other organizations such as the ITC, the World Intellectual Property Organization (WIPO) and the International Telecommunications Union (ITU), and various other discussion fora on human rights, labour rights, some aspects of disarmament, intellectual property, health and others. As a mission is assumed to generally cover all topics in Geneva, or at least have an understanding of the ecosystem, mission staff are often faced with making hard choices on which issues and meetings to follow. Many smaller missions are not able to have dedicated personnel solely focused on trade issues.

Table 7.1 Breakdown of the staff (incl. gendered) of the UN and WTO missions in Geneva, by region and country groups

	Separate function of UN & WTO missions	Double function of UN & WTO missions	Average size UN mission	Average share of women, UN mission	Average size WTO mission	Average share of women, WTO mission	Share of women heads of WTO delegation
Overall	58	105	10	0.4	5.7	0.37	0.3
Regional breakdown
Asia	16	25	11.8	0.33	6.9	0.3	0.24
Europe & Northern America	14	28	14.3	0.47	6.1	0.43	0.36
Latin America & Caribbean	17	12	6.6	0.54	5.2	0.41	0.24
Oceania (including Pacific countries)	4	1	4.6	0.52	4.3	0.45	0.5
Africa	7	39	8	0.3	5	0.35	0.33
Country groupings
OECD	12	19	17	0.49	7.7	0.44	0.29
SIDS	8	8	3.3	0.5	3.1	0.4	0.5
LDC	7	31	6.5	0.27	4.6	0.33	0.27
Developed	18	31	15	0.47	6.5	0.42	0.34
Developing	40	74	8	0.37	5.4	0.35	0.28
Industrialized	14	24	18	0.47	7.8	0.44	0.25
Emerging industrialized	13	15	11	0.44	6.4	0.38	0.04
Country income groups
High-income	22	31	13.8	0.46	6.8	0.41	0.23
Upper-middle-income	16	26	9.8	0.43	5.8	0.38	0.43
Lower-middle-income	15	22	8.7	0.41	4.7	0.36	0.32
Low-income	5	26	6.9	0.24	5.3	0.32	0.21

Source: authors’ collection of data (based on interviews and discussions with relevant stakeholders; details withheld. On file with authors).

Averages are simple arithmetic averages.

The 37 per cent representation of women in WTO missions is a score that can seem relatively close to parity. However, one should be careful in interpreting this number as an indicator for gender inclusion in resulting trade policy. The gendered effects of trade are multifaceted and require not only a multitude of experts to account for, but also a vast network during the process of negotiation to get certain concessions or commitments through. However, the presence of women in trade negotiations is an improvement to the overall ‘masculinity’ of trade and negotiations and is a first step to creating a more gender-inclusive trade policy.

7.4 Trade Negotiations Need Networks

Trade negotiations are a complex process that rely on the ability of chief negotiators and their whole team to influence the other party and ensure win–win outcomes. A fundamental component of an effective negotiating strategy is the ability to connect to institutions and expertise in their own capitals.²⁴

Quite often, negotiations are pictured as two or more parties sitting at different sides of the table having different interests. We see people sitting at the table signing papers next to each other on front pages of newspapers as a symbol of concluded trade negotiations. This image is misleading not only because people on these front pages are usually not the ones doing the negotiations, but it can also give an inaccurate message about the process of negotiation, and the diverging goals of the negotiating parties. The common goal of negotiating parties is to reach an agreement – this was confirmed by the Brexit process, where despite the diverging interests and various difficulties, the ‘no-deal’ scenario was avoided as it was apparent that no agreement was the least preferred scenario on either side of the table.²⁵

Processes and people matter for successful negotiations. There are certainly some personal traits that can contribute to a more successful outcome at the negotiating table, such as persuasion, charisma, assertiveness and communication skills. Successful negotiators are quite often branded with such images as ‘punching above their weight’, ‘heavy hitters’ and ‘aggressive players’.²⁶ These are viewed ‘traditionally’ as male skills and characteristics,²⁷ as gendered power systems tend to assign such skills to ‘men’s jobs’, which require a generally higher level of power and fewer women tend to apply for them.²⁸ One can argue that such a traditional, and frankly inaccurate, perception of negotiation as a ‘man’s job’ could be one reason for fewer women choosing such a career. After all, if one looks at gender stereotypes, one can also say that women tend to be more collaborative in their decision making.²⁹ In addition, our interviews also show the anecdotal evidence that a higher presence of women at the negotiating table may lead to faster compromises and conclusion of the trade agreement.³⁰

However, the biggest success factor of negotiations may lie outside of the negotiating room: the connection with the capital. As described above, the negotiation process has a double location – at the negotiating table and in the capital. Achieving the ultimate goal of negotiations (conclusion of a trade agreement where both sides gain more than they lose) requires receiving guidance and expertise from the capital, approving of texts and positions and requiring quick feedback and decisions. One can assume, in most of the cases, that this will require a number of inter-agency and inter-ministry consultations, verifications and active lobbying with the business community and civil society for certain concessions. Additionally, every step involves not only political consensus, but also certain administrative steps – be it sending a memo between different ministries or associations, or just registering incoming documents. To speed up the response from the capital and overcome or make more efficient these ‘red tape’ processes, personal connections and political aptness are key for negotiators.

Historically, diplomatic and political connections in any country were in the hands of men, and this can explain the relatively lower presence of women in trade (and the UN) missions today. Changing the gender make-up of a profession can take generations. Based on the collected data on missions in Geneva, it is not a surprise that the presence of women trade experts, diplomats and negotiators is higher in countries that score better on gender equality domestically. Active encouragement of women to pursue government-related careers could help bring more women to positions where they are engaged in the negotiation process. There is evidence that even when quotas for women were introduced, women have tended to fall out of government careers³¹ – a phenomenon that is yet to be studied further. What could be the reasons for women not staying in the government positions, and can these reasons be curtailed in order to enhance women’s participation?

A first relevant factor is that trade negotiations take years. The greater the number of participating countries, the longer will be the negotiations. Overall, the trade negotiation process can be described in several steps:³²

1. (1) Consultative process of negotiations;

2. (2) Development of country position and possible scenarios for the concessions;

3. (3) Negotiation of the process of negotiation: determination of the number of rounds, chapters to be negotiated, when and where;

4. (4) Actual process of negotiation: party-to-party interaction; and

5. (5) Formal conclusion: the official ‘signature’ moment, ratification in the executive body, official notification to the WTO and other trading partners.

While the beginning and end of the negotiations are set points in time, the intermediate steps can be repeated many times and span many years. These intermediary steps may never come to fruition – for example, in the case of the Transatlantic Trade and Investment Partnership (TTIP) – but if they do, the signature process is a huge political success.

Quite often during the process of multilateral and regional negotiations, the process is split into stages of active face-to-face negotiations in a predetermined location and time to lobby/gather feedback in the capital – requiring much travelling in between.³³

Negotiations at the WTO are premised on consensus-building with the hitherto unused option of majority voting available.³⁴ Finding a common position among 164 countries requires building alliances that are ever more nuanced and therefore require even larger networks. In the world where there are so many trade topics in many trade fora, countries are naturally drawn to build strategic alliances and partnerships, pooling resources and accessing information.

Just having women present in trade negotiations does not control for women as a population group having similar access to the benefits of trade agreements as men. Research shows that gains from trade liberalization are distributed unequally between men and women due to the systemic issues across different areas of human activity, including access to finance, skills, prohibitive laws and social norms.³⁵ Expecting a woman negotiator to be an expert not only in her field of expertise, but also in all other fields that interact with gender, or being able to forecast the gendered impact of trade policy taking into account all these dimensions, is an unrealistic assumption. Of course, every woman negotiator brings her own experience and perspective as a woman to the table, but it does not substitute for gender inclusion in the process of negotiation.

A separate remark has to be made about the effect of the COVID-19 pandemic on trade negotiations. The overall move of negotiations to virtual/hybrid format and higher reliance of government officials on computer-enabled processes had the potential to improve the general speed of interaction and reaction of the capital. At the same time, it had an ambiguous effect on the ability of negotiators to build connection and trust during the negotiations.³⁶ The pandemic definitely has opened the door to creating a more inclusive structure of trade negotiations, but it is yet to be understood how this can be successfully utilized to achieve the common goal of any trade negotiation – conclusion of trade agreements that benefit its addressees.

7.5 To Be a Negotiator Is a Career Choice, Trade Negotiations Are Not

While it is safe to assume that having sufficient women representatives in trade negotiations is a positive development for the negotiations themselves due to women’s higher propensity to achieve more collaborative interactions,³⁷ tasking women negotiators to represent the whole multitude of ‘women’s interests’ in trade negotiations is misplaced. The larger question is how do we systemically ensure that ‘women’s interests’ can be reflected in trade negotiations?

Trade negotiations increasingly cover more and more topics, both in the WTO and at the regional level. Independent from the type of negotiation, the interviews have indicated that expertise in the negotiating party can be split into two fields – ‘generalist’ and ‘expert’ negotiators. The generalist negotiators are often responsible for the overall process of negotiation – exchange of positions, ensuring fulfilment of the procedural code, getting a response from the opposite party. Their key skills are institutional memory and diplomatic connections that they can use to try to get a better offer from the opposing party. The more experienced the generalists in trade negotiations, the more a country can ‘punch above its weight’ in trade negotiations.³⁸ Where women are present in these roles, this mostly happens in countries where gender equality has been targeted internally for decades.

The ‘expert’ negotiator deals with the more technical side – the aspect that has been gaining in prominence – such as covering Technical Barriers to Trade (TBT), Sanitary and Phytosanitary Measures (SPS), climate change, rules of origin, environmental issues or other related issues. The complexity of these issues varies with the agreement and the countries, but it requires specialist knowledge given that the impact goes beyond the scope of diplomacy and to the heart of domestic policy development. One can think of the example of the trade facilitation negotiations where many of the experts were from customs and other border agencies and not necessarily from the foreign affairs or foreign trade office. The same can be seen in the fisheries subsidies negotiations where many large countries are able to be represented by officials and experts from the agriculture, fisheries or environmental ministries. Their involvement is dynamic, and often issue-specific.

This vast scope of specialists that are involved in trade negotiations serve as a bridge to the issues to which women are ‘traditionally’ assigned, as in many countries women’s segregation by profession is still present.³⁹ So when women are present in trade negotiations, are they mostly assigned to ‘expert’ fields, or do they occupy more ‘generalist’ positions? Based on the authors’ experience, there is no clear-cut answer on that. Moreover, while women heading negotiations does indeed have the potential to lead to greater inclusion of some women’s interests in the absence of overall gender inclusion, having women specialized in certain topics can bring more tailored and specialized gender inclusion and is overall a stronger indicator of a more gender-equal society.

With the increasing complexity of issues covered by trade agreements – gender, environment, technology, IP, investment, human rights – one can be certain that there will be an increase of negotiating teams to include experts from those fields.⁴⁰ The increasing technical charge of trade agreements and growing political tensions around trade will also increase the need to bridge between expert jargon and generalists’ political messaging.

Based on the information collected in the preparation of this chapter, it became obvious that there is no common structure in the order of engaging different types of negotiators. In some cases, both ‘generalists’ and ‘experts’ are present in the negotiating room; sometimes they take turns negotiating by chapters; sometimes generalists are well-prepared and can negotiate just checking in with experts; sometimes experts are placed in the capital, with generalists consulting with them constantly.

The expansion of trade negotiation teams is not universal – as with the size of trade missions in Geneva, some countries have limited diplomatic resources for trade policy and even less financial resources.⁴¹ In many smaller countries, or ‘latecomers’ to trade negotiations, the ‘expert’ and ‘generalist’ is often the same person, and there is sometimes a need to rely on international experts for support, paradoxically often funded by their negotiating opponents. Organizations such as the South Centre, the Commonwealth Secretariat and the Advisory Center on WTO Law (ACWL) also provide legal, technical and analytical support to developing countries as part of their mandate.⁴²

Some of these small countries and ‘latecomers’ may have a harder time catching up, facing the tension between being locked out from the integration processes and not having enough trade policy expertise at home to protect national interests. Interviews with small delegations have confirmed that such latecomers have greater difficulties crafting their own position and may quite often outsource the underlying trade analysis to experts in other countries or international institutions.

A separate remark has to be made about the importance of training of officials provided by international organizations. Training provided by the WTO, the UNCTAD, the ITC and other organizations⁴³ tend to be built on a best-practices approach, and therefore can provide a timely source of knowledge on the latest topics in trade, sometimes being the sole source of affordable expertise on such issues as gender and trade, trade and environment, or financing for trade for government officials.

7.6 Women’s Representation versus Women’s Inclusion in Trade Negotiations

The purpose of this chapter is not simply to discuss whether women are represented at trade negotiations – but also to highlight that women representation in trade negotiations does not guarantee that ‘women’s interests’ are included in the resulting negotiated text of a trade agreement. This puts trade negotiations into a wider context of achieving global gender equality.

Women’s representation is quite often a misleading proxy for including women’s interests. Therefore, when women’s representation is discussed, it is often intended to serve not as a role model of a particular career, but also as the channel to include women’s interests at large – to create gender inclusion in a trade agreement. It is important to recognize the difference between the two. While there are positive benefits of women’s representation on gender equality (see next section) in the negotiated trade agreement, it is not a sufficient element to ensure the gender inclusion of the negotiated outcome and that the interests of women are fully reflected. This can be ensured only when negotiation is gender-sensitive and/or gender is a part of the analysis in the process of negotiation.⁴⁴

As we discussed, the negotiation itself is a highly technical process that involves many different types of expertise, including both professional negotiators and specialists in a particular field. Women’s representation in the trade negotiations therefore depends on encouraging women to take on these kinds of jobs and to ensure the environment is supportive of growing responsibility for these women. Access to skills and training, family-friendly policies for diplomats and negotiators and mentorship are all important elements to attract and maintain women’s representation in this career.

Can we assume that the inclusion of women in trade negotiations implies that gender equality is improving as a result of what is negotiated? Trade negotiations are a success when they result with the conclusion of a trade agreement. Trade agreements in turn contain not only preferential trade terms between countries, but also better regulatory frameworks, means to liberalize trade and improve development outcomes. Recent data⁴⁵ shows that trade agreements are hard to implement, and developing countries are lagging behind even on implementing existing agreements and using certain preferential rates. When we take into account the social complexity of addressing gender, regional trade agreements have the potential to both improve and worsen the situation of women if the unequal distribution of trade effects domestically are not controlled for.

There is evidence that trade agreements improve gender equality – but this is dependent on agreement-specific factors.⁴⁶ This, along with the generally unequally distributed gains from trade liberalization, brings us to the conclusion that the biggest possible positive effect of a trade agreement on gender equality can be only achieved in its gender-inclusive implementation at home.

While the existing gender chapters do not have specific commitments or enforcement mechanisms,⁴⁷ they signify a huge step forward in recognizing that to control for diverging impacts on men and women, trade agreements should not be assumed to be gender-neutral, but should be actively gender-inclusive.⁴⁸ There is yet an unproven effect on gender equality of trade and gender chapters, and the high cultural sensitivity of gender issues makes it unlikely that such gender chapters can be included in all upcoming trade negotiations. Inability to have gender provisions or chapters does not automatically undermine the inclusion of issues of importance to women in trade agreements as there are other ways of incorporating them – such as adding gender as a dimension to be considered during the analysis of the potential effects of trade agreements at the negotiation stage.⁴⁹

The existence of SDG 5 creates the sentiment and a set of indicators,⁵⁰ but there is no recipe on how it should or can be implemented in each country. There is a lingering lack of gendered data – both in trade and globally. Collection and transparency about such data can be more problematic in some societies due to cultural sensitivity but it is often as a result of the appropriate systems not being in place to capture this important disaggregated data. This disaggregated data is not only essential to ensuring that trade agreements are gender-sensitive but gives governments the means to monitor and measure the consequent impact of the agreements on women.

There is a misleading sentiment that only women should be in charge of gender-inclusion issues. While it is undeniable that there is a positive effect of having greater women’s representation and women role models it is inaccurate to assume that a woman put into the lead negotiator position will automatically have the understanding of how to propose policies that are gender-inclusive on a large scale. This is why it is crucial that systemic changes are made at all stages of the trade negotiating cycle to infuse gender-sensitivity, gender-disaggregated data and gender training irrespective of which gender is leading the negotiations.

Given the uneven representation of women in negotiations and the general lack of gender mainstreaming, having women negotiators is better than having no women at all, but it does not automatically ensure greater inclusion of gender issues in trade policy.

7.7 Women’s Representation as a Tool for Gender Equality

Women have been notoriously absent in history⁵¹ and despite greater awareness and anxiety around issues of gender equality today, there is still a clear divide, with women not only earning less than men for the same job, but also having more limited access to basic human rights and suffering greater effects from economic and climate shocks.⁵² Much of this disparity is not only dependent on socio-economic factors, but also connected to cultural and religious factors. This makes the global advancement of gender equality not only institutionally complex, but also highly charged politically. Although it is beyond the remit of this chapter, the situation is even more dire when elements such as race, ethnicity and socio-economic status are brought into the picture.

In such a globally unequal situation, women’s representation has not always been seen as an overall improvement, but rather as a ‘patch’ to the situation. There has even been a backlash, and scepticism regarding the competency of women placed in positions of power.⁵³ Nevertheless, the overarching positive impact of greater representation of women, specifically in trade-related activities, cannot be ignored.

First of all, role models matter, especially for roles where there is a gender bias, and more so in developing countries.⁵⁴ Having women negotiators sends a powerful signal of career possibilities (as discussed earlier, networks and influence are key components of a negotiator’s job).

Secondly, women overall have different sets of skills and perspectives – partially invigorated by systemic limitations and disadvantages – and can bring different dynamics and views to the process of negotiation. While this requires further research, the anecdotal evidence that the authors collected during the interviews proves that having a sufficient number of women negotiators changes the dynamics of the process – potentially making it less charged and more efficient.⁵⁵

Thirdly, in the absence of the overall common understanding of the nexus of trade and gender, having women at the negotiation table – and involved in the negotiation process at large – provides a source of knowledge on these issues and their experiences. Women engaged as experts in the negotiations inevitably bring their gender-specific experience into policy analysis, assessing the impact of different negotiated concessions not only from the economic standpoint, but also through the gender lens. Women negotiators can also channel their knowledge into the negotiations, improving the gendered effect of negotiated policies.

All in all, while women’s representation may not be the perfect tool to address gender inequality, the key benefits outlined can turn trade negotiations into a tool for better gender equality. The more gender-informed and inclusive the process of trade negotiations, the higher are the chances of more gender-inclusive outcomes.

7.8 The Way Forward

While there may have been progress, there is no doubt that improvements are needed to enhance the presence and impact of women in current trade negotiations, However, the system can also be systematically inclusive if, along with gender awareness, the appropriate incentives are provided for women to pursue diplomatic careers in trade and government positions overall.

Women’s representation has a positive effect on trade negotiations in terms of both the negotiation process and the substance of negotiations. The complexity of modern trade negotiations requires experts from a variety of fields, and to secure women’s representation overall it needs to be improved throughout various fields. Women can be encouraged to pursue diplomatic careers, and gender disparities (both vertical and horizontal) in other areas of government careers should be addressed – for example, through gender strategies.

But while women’s representation at trade negotiations should not be a goal in itself, the inclusion of women’s interests should be. A woman negotiator brings her soft and hard skills and her experiences, including her gender-specific experiences, into the negotiation process – this can improve both the process and outcome of the negotiation. However, it is a flawed logic that a woman placed at the negotiation table should be in charge of representing the interests of all women in the country. Trade touches a variety of fields of expertise and therefore has a multidimensional intersection with gender issues that are specific to each field. Representing the interests of all women in the country is only possible when these interests are included in the analysis of how the negotiated outcomes impact women who are active in these fields. This can only be done when using appropriate tools and when gender equality is mainstreamed throughout the overall priorities and policies of the country.

Therefore, gender aspects should be included in the analysis of policy proposals during the stage of trade negotiations. This analysis can result in subsequent creation of specific chapters or provisions, or just serve as the background papers that inform the more traditional trade concessions that will have a more positive (or rather, less negative) impact on women.

Geneva remains a centre of international trade law and policy making, but there is an uneven capacity in diplomatic missions to serve all the ongoing negotiations, with much higher pressure on staff from developing and small countries. In such circumstances, countries have to prioritize among different topics that are being negotiated, and gender often is not given top priority, overshadowed by such issues as climate change, carbon offsetting, health, security and others – all issues which have a very clear gender dimension as well.

The persistent lack of data about the gendered effects of trade policy can be addressed at the multilateral level through the Trade Policy Review mechanism of the WTO⁵⁶ and through data collection initiatives such as ITC’s SheTrades Outlook.⁵⁷ Including on a systematic basis a gender component in the WTO’s trade policy reviews of countries will not only provide more information about the current state of play and practices, but will also educate the countries to pay attention to these issues.

We need to realize that gender inclusion is not the sole responsibility of women, but of all genders. There is no doubt that the presence of women trade negotiators improves the speed and overall structure of how trade negotiations are conducted. But charging women trade negotiators to represent women’s interests for the whole economy is as much a retrograde step as having no women involved in trade negotiations. Prioritizing women’s interests in trade negotiations is important. Bringing more women to the negotiating table is important. We have to be able to do both at the same time, but it has to be the responsibility of everyone.

8 The Importance of Gender-Responsive Standards for Trade Policy

Gabrielle White and Michelle Parkouda

8.1 Introduction

Because I am a woman, I am at a greater risk of being seriously injured or killed if I am involved in a car accident.¹ Because I am a woman, my personal protective equipment (PPE) does not protect me as well as it protects my husband, brother, father, or son.² Because I am a woman, voice-recognition software has difficulty understanding me.³

These are just a few of the consequences women face because they live in a world built for men. Women are consistently and persistently underrepresented in the data that is used to design and engineer our world,⁴ and this includes the development of standards for crash test dummies, personal protective equipment, and artificial intelligence, among other things. This results in inequitable outcomes for women relative to men.

The persistence of gender gaps in all aspects of society indicates that the following does bear repeating:

Women and girls account for half the world’s population and therefore represent half of its potential. Gender equality is central to all areas of a healthy society, from reducing poverty to promoting health, education, welfare, and well-being of girls and boys. Reducing the gender gap promotes economic development. Societies are unable to unlock their potential and meet the challenges of rapid economic and technological change without harnessing the skills and ideas of their entire population.⁵

Consequently, closing all forms of gender gaps, including the gender gap in standardization, needs to be a priority. The United Nations Economic Commission for Europe (UNECE) Working Party on Regulatory Cooperation and Standardization Policies (WP.6) has been a leader in bringing attention to the gender gap in standardization and taking action to address it. In 2016, members approved the development of a ‘roadmap and recommendation on mainstreaming gender into standards and regulatory policies at national and international levels’.⁶ Subsequently, the Gender Responsive Standards Initiative began with the acknowledgement that:

1. (a) Prevailing gender norms present barriers to women’s participation in the development of standards;

2. (b) [The d]ominance of male representation in standard-setting affects the way that standards are produced, with insufficient consideration of women specificities in the deliverables; and

3. (c) Standards are generally presumed to be gender-neutral and are developed without recognizing the differences between male and female standard users.⁷

In 2018, the UNECE Declaration for Gender Responsive Standards and Standards Development was approved.⁸ The Declaration is significant because it was the first initiative that targeted standards development organizations and national standards bodies, providing them with tangible and concrete actions that they can undertake to address the gender gap. The Declaration has been an effective catalyst for getting gender on the agenda of national standards bodies and raising awareness amongst standards organizations of the importance of considering gender in standardization. The Declaration was open for signature in May 2019 during an international signing event and as of February 2023, there were eighty-one signatories who committed to take action to address the gender gap in standards development.

The gender gap in standardization has widespread consequences, as it can introduce biases wherever those standards are applied. As such, the usage of standards in Free Trade Agreements (FTAs) and trade policies can exacerbate inequitable outcomes for men and women. In effect, the absence of gender-responsive standards has resulted in the proliferation of goods that are not designed to keep women as safe as men. Trade policy can be leveraged as an effective tool to improve gender-responsiveness in standardization and advance women’s economic empowerment.

To understand the relationship between gender, standardization, and trade policy, Section 8.2 will begin by providing an overview of the role of standardization in trade agreements. Next, Section 8.3 will elaborate on the gender gap in standardization and why it is dangerous. Finally, Section 8.4 will discuss how addressing the gender gap in standardization can lead to more inclusive trade. Section 8.5 concludes.

8.2 Standards in Trade Agreements

While FTAs help to foster the movement of goods and services across borders, the chapters on standards, technical regulations, and conformity assessment procedures are a vital, though perhaps less well-understood, part of trade agreements. In FTAs, obligations on standards and conformity assessment are found in Technical Barriers to Trade (TBT) chapters. To varying degrees, these chapters incorporate or reference portions of the World Trade Organization (WTO) TBT Agreement.⁹ According to the Government of New Zealand, TBT chapters ‘aim to reduce the impact of TBTs on global trade and create a fair, facilitative and sustainable trading environment’.¹⁰ These chapters focus on the structures and practices that reinforce the transparency and openness of the systems that underpin the development, adoption, and use of standards, technical regulations, and conformity assessment, to ultimately improve the predictability of global markets and reduce the occurrence of technical requirements causing unnecessary barriers to trade.

FTAs have been a powerful tool to reduce tariffs to support the flow of goods and services between countries. However, as tariffs have reduced, there has been an increased focus on non-tariff measures (NTMs) and their impact on free trade. The Economic and Social Commission for Asia and the Pacific and the UN Conference on Trade and Development (UNCTAD) have estimated that NTMs cost twice as much as ordinary customs tariffs.¹¹ Research from the US government has shown that up to 93 per cent of global trade is impacted by technical regulations, which can include standards.¹² Given the impact that NTMs can have on trade, it is not surprising that increasingly progressive trade agreements are bolstering their technical barriers to trade chapters. For example, the Canada–European Union Comprehensive and Economic Trade Agreement¹³ (CETA) includes a unique Protocol on the mutual acceptance of the results of conformity assessment,¹⁴ which is far more ambitious in reducing NTMs than any other FTA Canada currently has in place. The Protocol attempts to deal with the long-standing issue of in-country conformity assessment requirements by allowing Canadian manufacturers to have their products certified to the EU requirements in Canada, and vice versa.

8.2.1 What Are Standards?

Standards are an important regulatory tool that have significant trade implications. Generally speaking, standards are voluntary documents that outline specifications, characteristics, or production methods for products, processes, or services. They are written by a group of people, typically volunteers, representing relevant stakeholder categories, who arrive at the content of the standard through consensus.¹⁵ Standards are often described as invisible infrastructure.¹⁶ They permeate everyday life, and their role is influential in shaping the design of social life and public infrastructure. And yet they often go unnoticed. Everything from your car to your mobile phone, to your toothbrush is based on standards. Because of their ubiquity, it is essential to understand the myriad ways in which they can alleviate or exacerbate the gender gap in the products, processes, and services that we use as well as those we import and export.

Standards play an important role in international trade for a number of reasons. For the purposes of this chapter, three areas are noteworthy:

• The first, and perhaps the most basic one, is that standards allow goods and services to be produced and reproduced in a consistent and repeatable manner. For producers, this can improve efficiency while also ensuring the quality of products. For consumers, this predictability increases user confidence and expectations.

• Second, standards are important for interoperability. Interoperability is the ability for two or more products or systems to interpret and exchange information. Interoperability allows trains to travel across national borders where tracks have been standardized. Geographic differences in standard requirements can result in a lack of interoperability; for example, travellers are often reliant on adapters because voltage requirements tend to be regionally standardized. A lack of interoperability is also seen with the need for unique cords to charge different electronic devices because their ports are different. Indeed, this has come to be such a problematic issue that the European Commission is proposing to revise the Radio Equipment Directive to require all handheld devices to standardize to one common charging port.¹⁷

• The third reason is the health and safety of humans, animals, and the environment. A key component of standards is ensuring that products are safe for use. Standards can specify exposure limits for chemicals, safety requirements for machinery, the requirements for personal protective equipment, and so forth. The protection of health and safety, and the environment, are considered legitimate objectives for regulations by the TBT Agreement, so long as the measures are not more trade-restrictive than necessary.¹⁸ For example, construction standards will differ due to climate; building on permafrost will require different specifications than building in a desert.

For these reasons, among others, governments have recognized that standards are effective regulatory tools that can be a cost-effective way of leveraging prevailing knowledge and expertise.

In the context of the WTO TBT Agreement, standards and technical regulations are distinguished between voluntary and mandatory. Specifically, a technical regulation is a ‘[d]ocument which lays down product characteristics or their related processes and production methods, including the applicable administrative provisions, with which compliance is mandatory. It may also include or deal exclusively with terminology, symbols, packaging, marking or labelling requirements as they apply to a product, process or production method’.¹⁹

In Canada, as in many other jurisdictions, standards are voluntary when they are developed. However, voluntary standards may become part of a technical regulation when incorporated into regulations and therefore take on the force of law. For example, in Canada alone, there are over 1,500 references to standards in Federal regulations and almost 5,000 references in Provincial and Territorial regulations.²⁰ Therefore, for the purposes of this chapter, both standards and technical regulations are relevant for the discussion at hand since standards may come to form the basis, or part of, technical regulations.

Within the TBT Agreement, there is preference for the use of international rather than domestic standards in technical regulations. Specifically, Article 2.4 states:

[w]here technical regulations are required and relevant international standards exist or their completion is imminent, Members shall use them, or the relevant parts of them, as a basis for their technical regulations except when such international standards or relevant parts would be an ineffective or inappropriate means for the fulfilment of the legitimate objectives pursued.²¹

Moreover, members are encouraged to participate in the development of international standards so that they reflect the needs and realities of their domestic economies and will therefore be more easily integrated into domestic technical regulations or standards. The reason for this is that broad use of international standards allows for more efficient trade. According to research conducted by the US National Research Council, ‘[w]hen different countries or regions have different technical standards for essentially the same product, manufacturers selling into multiple markets are forced to produce multiple versions of the same product. For example, automobile production lines must be switched between right-hand and left-hand drive cars for the United Kingdom and continental Europe’.²² In this regard, it is important to note the influential role of international standards for trade.

Finally, because standards are so influential in international trade, and ubiquitous in our daily lives, the content of standards really matters. According to the WTO TBT Agreement, standards should contain requirements that are performance based. Specifically, Article 2.8 states, ‘[w]herever appropriate, Members shall specify technical regulations based on product requirements in terms of performance rather than design or descriptive characteristics’.²³ The focus on performance is meant to help address the trade dimension of standards while attempting to counteract potential bias in terms of provenance. This element is particularly relevant for the topic at hand because it fails to explicitly address one key question: performance for whom? As this chapter will explore further in Section 8.3, the male perspective has long been held as universal. In fact, according to Criado-Perez, ‘we rely on data from studies done on men as if they apply to women. Specifically, Caucasian men aged 25–30, who weigh 70kg. This is “‘Reference Man”’.²⁴ Developing standards for reference man has implications for women, as well as for those men who are outside the norm for ‘reference man’.

8.2.2 What Is Conformity Assessment?

Any discussion of standards is not complete without addressing the role of conformity assessment. As noted, voluntary standards can be useful in situations where risks to health and safety, the environment, and national security are lower. However, typically, if a product, process, or service requires a standard by law,²⁵ then conformity assessment will be used to demonstrate compliance with the standard. According to the International Electrotechnical Commission (IEC), conformity assessment is:

[a]ny activity that determines whether a product, system, service and sometimes people fulfil the requirements and characteristics described in a standard or specification. Such requirements can include performance, safety, efficiency, effectiveness, reliability, durability, or environmental impacts such as pollution or noise, for example. Verification is generally done through testing or/and inspection. This may or may not include on-going verification.²⁶

In other words, conformity assessment allows for an independent verification that a product or process meets the requirements established by a specific standard. While not all products or services require third-party conformity assessment, as the IEC definition notes, there are times when an independent verification is necessary to ensure they can be safely used. For example, conformity assessment is used to ensure that your vacuum cleaner operates the way it should and that it does not catch fire or electrocute you while you are using it. Conformity assessment is an essential element of the TBT Agreement as it plays an important, and somewhat distinct, role in the movement of goods across borders. Indeed, conformity assessment procedures are directly linked to the efficient functioning of international markets: ‘Even when standards in different countries have been harmonized, the free flow of trade is inhibited if products are subjected to redundant testing and certification requirements in multiple export markets.’²⁷ Depending on the conformity assessment requirements in different markets, exporters may need to ship their goods to the destination market for costly and duplicate testing, or to pay for foreign inspectors to visit domestic production sites in order to obtain the necessary conformity assessment mark.

Conformity assessment requirements can also have implications for economic opportunities. International trade is an important source of economic growth. However, globally, small and medium-sized enterprises (SMEs) are less likely to be involved in international trade.²⁸ SMEs are less likely to have the resources needed to navigate complex regulatory requirements, which can include conformity assessment requirements. Women-owned businesses are more likely to be SMEs, and in Canada, women-owned SMEs are even less likely to export than those owned by men.²⁹ While conformity assessment is an essential part of the quality infrastructure to safeguard citizens, it can also inadvertently limit the economic advancement of some businesses, including women-owned businesses which often have less capital.³⁰

8.2.3 How Can Trade Policy Leverage Standards and Conformity Assessment to Advance More Inclusive Trade?

Understanding the linkages between gender, standards, conformity assessment, and trade is important because it helps illustrate the significant impact this invisible infrastructure has on our day-to-day lives. Goods are required to meet technical regulations of the market they are entering. Consequently, standards and conformity assessment play an integral role in the movement of goods across borders. Standards dictate the minimum requirements for those goods coming into a country, and conformity assessment procedures explain the process the goods must undergo to demonstrate compliance with those standards. As noted, the characteristics of standards and the necessity of meeting conformity assessment requirements have gender implications. Their usage in FTAs serves to amplify those effects, for good and for bad. Thus, it is essential that the gender impacts of standards, conformity assessment, and trade policy are explicitly considered and addressed.

To that end, in 2017, the Government of Canada signed Canada’s first FTA with Chile that included a chapter on trade and gender, which was also the first such agreement for any G20 country.³¹ Later that year, Canada joined 117 other WTO members to endorse the Buenos Aires Declaration on Women and Trade.³² The Declaration seeks to remove barriers to, and foster, women’s economic empowerment. Since then, the Canadian government has affirmed that moving forward with including gender and trade chapters in FTAs is a priority.

Although this chapter focuses on the impact of standards on trade and how the lack of gender-responsive standards results in uneven benefits for women and men, it is important to note that trade impacts women disproportionately in other ways. A report from the WTO found that women face higher tariff burdens. The report explains the ‘higher burden is the result of higher applied tariffs and greater spending on imported goods by women consumers. In the textile sector, for instance, the tariff burden on women’s apparel was USD 2.77 billion higher than on men’s clothing, and this gender gap grew about 11 percent in real terms between 2006 and 2016’.³³ In addition to the uneven impact of tariffs is the consideration of the impact of NTMs on women.

As previously discussed, the costs associated with complying with technical regulations, such as the cost of obtaining conformity assessment for goods, are often prohibitive for SMEs. Particularly if the market you are exporting to requires conformity assessment to a different standard or a technical regulation, this might require testing the product more than once. It may even require a complete redesign of the product to meet new or different requirements. The impact of this is significant when considering how they can be compounded: ‘Combined with the fact that women are more likely to own and run SMEs than large firms and that they often export and import a smaller amount of goods, this pattern also suggests that NTMs affect women entrepreneurs more severely than men.’³⁴

FTAs and trade policy have the potential to improve gender equality by removing some of the trade barriers that make women more economically vulnerable than men. Moreover, their reach can be even further when the gender impacts of technical regulations are considered. Specifically, if we can ensure standards are gender-responsive through their performance requirements, then those products and services are proliferated through trade in a way that keeps everyone safe. However, as we will explain in the next section, the vast majority of standards are not currently gender-responsive, which means that products and services are not proliferated through trade in a way that keeps everyone safe.

8.3 The Gender Gap in Standardization

Standards are powerful tools because they dictate the design, performance, and functionality of a good or a service. Therefore, the expertise of those who develop standards matters, as standards are shaped by the knowledge and experience of those who develop them. While there are often requirements for committees to ensure balanced representation of stakeholder categories, little consideration has historically been given to the personal attributes (e.g., gender) of those who develop standards. The result is that women are significantly underrepresented in standards development. At the International Organization for Standardization (ISO), only about one-third of technical committee members were women in 2020.³⁵ While you do not need to be a woman to develop a gender-responsive standard, it can be difficult to come up with solutions to problems you have not faced.

The preponderance of men, both historically and currently, participating in the development of standards does not help with androcentrism in standardization. Androcentrism is the tendency to view men as ‘representative’ or ‘default’ and women as ‘niche’.³⁶ Androcentrism privileges men’s experiences. It also results in research based solely on men being overgeneralized and applied to both men and women.³⁷ This has had unfortunate consequences. In medical research, medications have been withdrawn from the market because they were not adequately tested on women and, in fact, had serious side effects for women.³⁸

The low representation of women in standardization compounds the lack of awareness of the importance of considering gender in standardization. When ISO and IEC surveyed the leadership of their technical committees in 2020 to identify what actions were taken by the committees to consider gender, only 25 per cent of committees said they considered gender in the work of their technical committee.³⁹ While a quarter of responding technical committees had considered gender, only 13 per cent indicated that sex-specific requirements were included in their standards.⁴⁰ In other words, the vast majority of ISO and IEC technical committees do not consider gender when developing standards. Among technical committees that did not consider gender, almost 80 per cent said that gender is not relevant to their sector.⁴¹ The perception that standards are gender-neutral, or gender-blind, is both pervasive and insidious – and can have real consequences.

The fact that standards are often applied to inanimate objects, such as technologies, feeds the narrative that they are (gender) neutral in application. However, when inanimate objects are created and shaped by people, they can perpetuate biases. Artificial intelligence (AI) is a prime example of how technologies can be imbued with bias. It is now widely recognized that AI has perpetuated existing biases in hiring, credit limits, and health-care prioritization, to name a few areas.⁴² Gender bias can also be seen with physical products. For products that require a specific fit (e.g., PPE and dimensions for operator space envelopes), or require physical manipulation, do they take into account the differing size and strength of men and women? As evidenced by the survey of ISO and IEC technical committee members, there is still a significant gender gap in standardization.

8.3.1 What Are Gender-Responsive Standards?

If standards are not gender-neutral, then what would make them gender-responsive? As outlined in the UNECE guidelines for developing gender-responsive standards, a gender-responsive standard is developed with consideration for how gender impacts the content, requirements, and application of standards.⁴³ They ensure that both women’s and men’s needs, experiences, and concerns are an integral dimension in the design and performance of the product, process, or service undergoing standardization.

Gender-responsive standards should take into account both sex and gender. Biological and socio-cultural differences in men and women can impact the way men and women experience a standard. The COVID-19 pandemic provides an example of how sex and gender can differentially impact prevalence and mortality. COVID-19 has killed more men than women.⁴⁴ At the same time, in part due to prevailing gender norms, women are more likely to work in health care and there have been concerns that women health-care practitioners are at a greater risk of contracting COVID-19 because PPE has been designed for the average European or American man.⁴⁵ While researchers are still trying to understand why men are at a greater risk from contracting the coronavirus, it is clear that sex and gender can play a role in risk factors for contracting the virus and the prognosis. It is hoped that greater clarity around what constitutes a gender-responsive standard will prompt standards developers to collect the necessary data to determine whether there are gender considerations and what action needs to be taken to address them.

8.3.2 Why Does Gender-Responsiveness Matter in Standardization?

The current lack of gender-responsiveness in standards has consequences. These consequences can at times be minor inconveniences. For example, ventilation standards are based on men’s metabolism.⁴⁶ As a result, women are more likely to be cold in the workplace. Being cold at work is not merely a matter of comfort. It is associated with reduced typing speed and decreased cognitive performance.⁴⁷ In other words, the lack of gender-responsiveness in ventilation standards can be detrimental to an organization’s overall productivity and performance.

A failure to consider gender in standardization can also be fatal. Research in multiple countries has shown that women are more likely to be seriously injured or killed when they are involved in a car accident because crash test dummies are based on male anthropometry. Research on gender considerations in car accidents dates back to at least the 1960s, and yet action has been slow.⁴⁸ However, it does appear that efforts to address this gap are finally gaining more traction. In 2021, the UNECE Working Party on Passive Safety released a proposal supported by Canada, France, Germany, Japan, Netherlands, Spain, and Sweden for an informal working group to examine sex- and size-neutral crash safety. The informal working group will analyse UNECE regulations and determine if changes are needed to ensure equal safety for men and women as well as individuals of differing sizes.⁴⁹

Sector-specific research such as on crash test dummies and anecdotal evidence have pointed to the impacts of standards that are not gender-responsive. Research in the health sector also illustrates the consequences of not accounting for gender (e.g., the increased mortality of women from heart attacks).⁵⁰ However, more recently a study using data from almost 100 countries examined the relationship between standardization activity and the number of men and women who die as a result of unintentional injuries. The premise of the research is that if standards can help to ensure the safety of products, processes, and services, then countries that are more involved in standardization should have fewer people dying as a result of unintentional injuries. Indeed, research has shown that greater standardization is associated with a reduction in the number of unintentional injuries even after controlling for the wealth and education levels of the country.⁵¹

Given the lack of gender-responsiveness in standardization, it was important to consider the unintentional fatalities separately for men and women. Globally, men are more likely to die as a result of an unintentional injury.⁵² And yet, when examining the impact of standardization on unintentional fatalities for men and women, we found that there was a significant negative relationship between standardization and unintentional fatalities for men, even after controlling for wealth and education.⁵³ In other words, the more a country was involved in standardization, the less likely it was that men died as a result of unintentional injuries. When the analysis was repeated to see the impact on women, there was no significant effect. Standardization was not actively associated with reducing deaths due to unintentional injuries for women. This report was the first of its kind to demonstrate the devastating consequences of not considering gender in standardization across a sample of almost 100 countries. It highlights the need to address the gender gap in standardization because unintentional injuries are preventable. Clearly standards can, and must, do more to protect women.

8.3.3 What Is Being Done about It?

The UNECE Gender Declaration has spurred action in this area. The declaration is explicit in asking signatories to take action to develop gender action plans for their organization and track progress towards improving participation rates and gender-responsiveness in standards.⁵⁴ The authors of this chapter developed the Standards Council of Canada’s (SCC) action plan. In SCC’s action plan, the authors prioritized three areas:

1. 1. Increasing participation of women in standards development;

2. 2. Developing guidance on how to develop gender-responsive standards; and

3. 3. Contributing sound research to better understand the implications of gender on standards.⁵⁵

Many other national standards bodies have developed their own gender strategies.⁵⁶ These national strategies have been complemented by international work. The UNECE is currently finalizing guidance on how to develop gender-responsive standards. This guidance is meant to be broadly applicable to standards developers to give them the practical tools needed to help them increase representation of women in standards development and to ensure standards are gender-responsive, regardless of who is developing them.

ISO and IEC have also formed a Joint Strategic Advisory Group (JSAG) on gender-responsive standards. The JSAG has gathered data from technical committee experts to understand the degree to which gender is a consideration for technical committees. It is also developing guidance specific to ISO and IEC for how committees can ensure their standards are gender-responsive. These initiatives have received a high level of support from the leaders of the respective organizations, which will be important for implementation.⁵⁷

8.4 Addressing the Gender Gap in Standardization for More Inclusive Trade

Gender-responsive standards are essential for inclusive trade. As we have noted, currently, standards are not doing enough to protect and support women. This means that when goods and services that rely on standards are traded, they are perpetuating inequality. By ensuring that standards, including those referenced in regulation, have addressed their gender gap, we can advance equality and improve outcomes for women.

While all standards would benefit from a gender lens to ensure that products that are not as safe for women are not inadvertently proliferated, targeted standards can also be a useful tool to promote gender equality in trade. In March 2021, ISO published an International Workshop Agreement (IWA) on Women’s Entrepreneurship – Key Definitions and General Criteria.⁵⁸ By developing an accepted definition of women-owned and -led businesses, the IWA has enabled governments, businesses, statistical agencies, and non-government organizations to clearly track progress and have targeted initiatives to advance economic opportunities for women.⁵⁹

In Canada, a publicly available specification was developed in support of the Government of Canada’s 50–30 Challenge. The 50–30 Challenge aims to increase representation of women and underrepresented groups in senior management and on Canadian boards.⁶⁰ As the name states, the government is challenging companies to achieve gender parity in senior management and on Canadian boards and to ensure that underrepresented individuals comprise 30 per cent of senior management and members of Canadian boards. The publicly available specification defines how to determine whether the targets have been met.⁶¹ Measurement is imperative to track progress and target initiatives to meet the objectives of the challenge.

The WTO can also play an important role in addressing the gender gap in standardization. The WTO is one of the only places where standards and technical regulations are disciplined. As such, it has an opportunity and obligation to ensure that standards and technical regulations are used to promote equity and advance economic opportunities for women. In fact, a report from the WTO delineated the ways in which trade can promote gender equality, stating:

Trade policy itself is a critical determinant in lowering the trade costs faced by women and improving women’s access to international markets. Discriminatory trade policies that make women-dominated industries less competitive and productive than their male counterparts are widespread. Women’s market access can be increased by addressing tariff and nontariff measures that hurt women traders and consumers, improving trade facilitation that enables women to trade as safely and easily as men, and expanding access to trade finance that empowers women to connect with international markets.⁶²

The Government of Canada has explicitly stated that it participates in trade negotiations and agreements because ‘it is in the Canadian interest to do so’.⁶³ Undoubtedly, Canada is not unique in this. International trade accrues many benefits for countries and their citizens. And yet, as we have highlighted, more needs to be done so that everyone is benefited equally.

8.5 Conclusion

This chapter argues that by addressing the gender gap in standardization and ensuring that the standards included in technical regulations are gender-responsive, we will increase the safety of products for women and contribute to women’s economic empowerment. By requiring gender-responsiveness in standards and trade agreements, countries can make meaningful progress towards addressing discriminatory social institutions and improving gender equality, which will benefit everyone.

9 Mainstreaming Gender in Investment Treaties and Its Prevailing Trends The Actions of MNEs in the Americas

Renata Vargas Amaral and Lillyana Sophia Daza Jaller

9.1 Introduction

The impacts that foreign direct investment (FDI) can have on gender issues are increasingly drawing the attention of policymakers and are gradually occupying more space in the decision-making processes of companies. As we are going to demonstrate in this chapter, particularly when investing in developing countries – such as the ones in Latin America and the Caribbean (LAC) – the lack of meaningful gender policies by multinational enterprises that guarantee participation by women may lead the MNEs to miss out on the tremendous impact they could have on gender equality.¹

Gender mainstreaming is defined as ‘the process of assessing the implications for women and men of any planned action, including legislation, policies or programmes, in all areas and at all levels’.² Gender provisions can be found in regional trade agreements as far back as 1957, and their inclusion has steadily increased over the years.³ Governments seeking to foster equality between men and women can also include gender considerations and concerns in the drafting and implementation of investment agreements. Similarly, corporations can include gender perspectives in the design, implementation, and assessment of their policies and programmes to ensure that they benefit men and women equally.

The World Economic Forum’s (WEF) Global Gender Gap Report 2021 predicts that it will take another 136 years to achieve gender equality based on the current rate of progress.⁴ The estimate is more pessimistic than the one cited in the 2019 report,⁵ mainly due to the disproportionate effect the COVID-19 pandemic crisis has had on women. However, the timeline is substantially smaller for the Americas, where it is estimated that gender gaps could be closed in 60–70 years. North America comes in second to Europe with regard to progress towards gender parity, followed by Latin America and the Caribbean coming in at third place. This gives multinational enterprises in the region an opportunity to contribute to the local economy and society in general, by implementing policies that advance gender equality.

This chapter unfolds as follows. In Section 9.2, we demonstrate why women are levers of change and the opportunities MNEs have in promoting women’s empowerment within their organizations and the communities where they operate. Then, in Section 9.3, we discuss the urgency of gender provisions in investment agreements in light of the evolution observed in recent years, particularly in bilateral investment treaties (BITs). Finally, in Section 9.4, we address forms in which FDI can be the driver of necessary changes, and how public, private, domestic, and international investment policies are of fundamental importance to further women’s economic empowerment. Section 9.5 concludes.

9.2 Women as Levers of Change: The Opportunity for MNEs

Gender equality is a crucial factor for economic development.⁶ It can contribute to poverty reduction and higher levels of human capital for future generations.⁷ Companies with gender diversity in emerging markets had a 13 per cent rise in their internal rate of return.⁸

9.2.1 Current State

Many reasons support the need to address gender inequality issues in the workforce. Although participation of women in the labour market has been on the rise, it remains a challenge along with the vast gender pay gaps across all occupations.⁹ A study carried out among 278 Canadian firms found that international firms are less likely to have women in management roles.¹⁰ The authors believe that this may be based on gender bias at the time of hiring for international positions, as women may be considered less capable of entering business networks due to their restrictive schedules or to negative stereotypes in the countries where they would work.¹¹

Social stereotypes deem women less capable than men of holding positions of leadership or working in certain fields, such as those requiring degrees in science, technology, engineering, and mathematics (STEM). Additionally, women are more likely to face microaggressions that undermine them professionally, such as being interrupted or spoken over, having their judgement questioned in their area of expertise, or having others comment on their emotional state.¹² Notably, the percentage of women reporting microaggressions in the United States is higher for women in leadership as well as women of colour.¹³

Women tend to be considered responsible for unpaid labour such as homemaking and childcare, leaving them with little time to dedicate to professional development. In the United States, women are responsible for almost twice as much unpaid care and domestic work as men.¹⁴ While 54 per cent of women report shouldering all or most of the household responsibilities, only 22 per cent of the men have this additional work.¹⁵ On a daily basis, almost half of the Latina workforce in the United States spend five or more hours on housework and caregiving.¹⁶ In many cases, these women are responsible for the care of children as well as adults in the family, such as an elderly family member.¹⁷ This unequal share was exacerbated during the COVID-19 pandemic, which resulted in an average increase of over five hours on the time women around the world spend just on childcare in one week.¹⁸ In 2021, 42 per cent of female employees in the United States said they were consistently burned out and 33 per cent reported having considered leaving the workforce or downshifting their careers due to them being overburdened with household work.¹⁹

In recent years, there has been a rise in the number of female board members worldwide. However, Latin America stands out as lagging in the number of women in boardrooms.²⁰ In fact, different from the global trend,²¹ there are no known quotas to increase the number of women on corporate boards in Latin America and the Caribbean. In the United States, the representation of women in the workforce drops at every level of the corporate ladder.²² While 48 per cent of employees at entry-level positions are female, women account for only 24 per cent of C-suite leaders.²³ The figure is even more staggering when it comes to women of colour, who only represent 4 per cent of the C-suite.²⁴ The state of California has taken the lead in this regard, seeking to reap the benefits of gender diversity. In 2018, it introduced Women on Boards, a law that requires all publicly held domestic or foreign corporations headquartered in the state of California to have at least one woman on the board.²⁵ Depending on the size of the company, the law may require two or more female board members. The enactment of the law has resulted in a 10 per cent increase in the number of women on boards over a four-year period.²⁶

Gender inequality in Latin America and the Caribbean can be due to a variety of factors. Stereotypes hold women responsible for most unpaid work at home and makes it difficult for them to access new labour opportunities.²⁷ Labour segregation also places women in low-quality jobs that limit their professional development.²⁸ This results in a large number of women working in the informal sector of the economy.²⁹ Additionally, women are faced with regulatory and cultural biases and limited access to capital and information that hinder their development as entrepreneurs.³⁰

The region of Latin America and the Caribbean provides a unique opportunity for investors to finance the recovery of the region through women.³¹ Women hold only 15 per cent of management positions, own only 14 per cent of companies in the region,³² and hold the top manager position in only 11 per cent of the companies.³³ At the same time, a higher proportion of women are in lower positions (36 per cent) while only 25 per cent are in higher positions.³⁴

Participation by women predominates in areas that are usually lower-paid – or ‘soft’ (those that do not require STEM skills), according to the report.³⁵ For example, women make up 64 per cent of the workforce in human resources, and 63 per cent in communications and public relations.³⁶ In other areas, such as foreign trade, women represent less than 35 per cent of the employees.³⁷ Studies have found that throughout the Americas, women make up less than half of the workforce with STEM degrees.³⁸ However, women with the same qualifications as men find it hard to get hired, likely due to social stereotypes and discrimination.³⁹ In the United States, women with STEM degrees are more likely to work in health and education while men tend to hold positions in technology, engineering, business, and management.⁴⁰

More data on the LAC region indicates that women represent only 35 per cent of the workforce that uses advanced technologies.⁴¹ This could be due to a lack of demand, discrimination, or the erroneous idea that women are less capable of handling technology.⁴² Another reason could be the lack of women with the required skills in the labour market.⁴³ Interestingly, women-led businesses were found to be more likely to employ women in positions that use technology.⁴⁴

Finally, six out of ten companies do not provide any type of maternity leave beyond what is determined by law and only 15 per cent of companies analyse the existence of salary gaps within their organization;⁴⁵ 28 per cent of firms reported giving lower salaries to women compared to men with the same qualifications. In this regard, women-led companies stand out again, being more equitable when it comes to employee salaries.⁴⁶ However, only a third of companies surveyed in LAC have boards with at least 30 per cent of women.⁴⁷

9.2.2 What Women Offer: The Business Case for Gender Equality

Companies that integrate gender equality into their business model can expect benefits in terms of profitability and success as well as social impact.⁴⁸ According to an International Labour Organization (ILO) analysis of data from 186 countries over a twenty-six-year period, there is a positive correlation between an increase in female employment and Gross Domestic Product (GDP) growth.⁴⁹ McKinsey & Company estimates that the global annual GDP could increase by USD 12 trillion by 2025 if gender inequality is addressed around the world.⁵⁰ The report goes further and imagines a best-case scenario, where women attain full gender parity around the world, resulting in a USD 28 trillion addition to the global GDP within the same timeframe.

Women generally have characteristics that are considered ‘soft skills’, such as effective communication, empathy, and self-awareness. In a survey carried out among Fortune’s 100 Best Companies to Work for, Chief Executive Officers (CEOs) cited these skills as the most desirable attributes in employees.⁵¹ Additionally, women tend to perform better than men in emotional intelligence competencies correlated with effective leadership, such as conflict management, adaptability, and teamwork.⁵² These traits place women at a competitive advantage in the workforce and should incentivize companies to promote a gender-diverse workplace, to take advantage of the best qualities of both genders.

Profitability

Companies with higher levels of gender diversity are more profitable, particularly companies with women in leadership roles.⁵³ In a survey conducted among 13,000 companies around the world, almost 60 per cent of the respondents reported that gender-diversity initiatives improved business outcomes.⁵⁴ In LAC, almost 75 per cent of companies surveyed saw profit increases between 5 and 20 per cent as a result of improving gender diversity in the workplace.⁵⁵ Research has shown that companies with women in leadership roles have better sales figures and equity value.⁵⁶ A 2016 study carried out by Credit Suisse Research Institute analysed the impact of diversity in the boardroom and the executive suite at over 3,000 companies around the world.⁵⁷ The study showed that having more women on both levels results in higher returns without taking more risks.⁵⁸ Additionally, among the sample of companies, share price performance was higher for companies with at least one woman on the board as well as for companies with more women in senior management – particularly for companies with more than 50 per cent women in senior management.⁵⁹

Women in leadership roles provide an important perspective, leading to significant returns on investment. The evidence shows that companies with more women on boards and in leadership positions have significantly better financial performance.⁶⁰ A 2020 McKinsey report highlighted that the most gender-diverse companies are 28 per cent more likely to perform better financially.⁶¹ A rise in female board members is correlated with less excessive risk-taking and a reduction in aggressive tax strategies.⁶² Importantly, a balance between the number of men and women in leadership and board positions also has a positive effect on financial performance.⁶³ The goal should not be all-women boards or only women leaders but diversity across all hierarchical levels of the company. Research has shown that there need to be at least three women on corporate boards for gender diversity to contribute to the financial performance of the company.⁶⁴ Gender balance in boardrooms could also motivate women to aspire to positions of power and diminish negative stereotypes around women’s capabilities in the workplace.

Gender diversity in the boardroom also has been shown to result in better decision-making, likely due to the greater diversity in background, experience, and perspective.⁶⁵ Diverse teams are less prone to groupthink, allowing them to evaluate different options more carefully. In a study of 108 technology companies, Morgan Stanley also found that those that have gender-inclusive policies had better returns on equity and lower volatility.⁶⁶ Gender-diverse companies also have less regulatory and operational risks.⁶⁷ Finally, a more diverse workforce has been positively associated with higher-quality work, greater team satisfaction, and more equality.⁶⁸

9.2.2.1 Market Expansion and Productivity

A focus on female consumers leads to significant market expansion. Women are usually responsible for household purchases⁶⁹ and they account for 85 per cent of consumer purchases,⁷⁰ making them an important consumer base. Companies need to understand how to market their goods and services to female consumers, including convenient times and locations according to their lifestyles.⁷¹ Alignment with female customers’ challenges and preferences can lead to a rise in their loyalty and an increase in sales.⁷² Women involved in the design and production process of goods and services take the female perspective into account, providing insights that amplify profitability for the company.⁷³ Finally, gender integration in companies’ business models can lead to increased perception of value by consumers, and therefore increased use and adoption of the goods and services offered.⁷⁴

A rise in female employment increases productivity throughout value chains.⁷⁵ Giving women access to jobs usually reserved for men can increase the companies’ productivity.⁷⁶ Companies with male and female employees can take full advantage of the different capabilities of both genders.⁷⁷ Employment of women in sales and distribution teams can lead to increased trust by female consumers, resulting in an expansion in customer base and increased customer retention and brand reputation.⁷⁸ According to a report by the ILO, gender-diverse companies report improvements in creativity, innovation, openness, and enhanced reputation.⁷⁹ Finally, research has shown that gender-diverse teams are more likely to produce radical innovation.⁸⁰ Companies should strive to have gender balance in the research and development teams, to take advantage of what both men and women have to offer.

9.2.2.2 Social Impact

Women in higher positions foster greater gender equality within their companies, promoting the implementation of diversity policies for the well-being of women within the firm.⁸¹ Firms with a female general manager employ more women than those led by a man, and are committed to help them grow professionally through mentoring, offering equal opportunities to those given to men, and eliminating bias in employment and pay.⁸² Additionally, women managers have been shown to provide more support to their teams, in terms of well-being and workload, than their male counterparts.⁸³ Women in leadership positions may be more committed to gender equality than men, having been exposed to inequality throughout their professional careers and personal lives.⁸⁴ Furthermore, they are more in tune with the difficulties faced by women and therefore can allow more flexibility in the workplace. Companies with women board members tend to have more remote work options and flexible working arrangements.⁸⁵ An increase in the number of women in leadership positions results in a broader candidate pool, leading to more qualified women available for board nominations. Finally, companies with a female CEO tend to have a higher percentage of women in managerial positions.⁸⁶

9.3 Emergence of Gender Provisions in Investment Agreements

FDI is a main feature of economic globalization, and it indicates long-term commitment and economic ties, with different levels of impact on the social, economic, cultural, and gender structures of the region receiving the investment. FDI is, for the most part, regulated by international investment treaties (IIAs) signed between governments – the government of the country receiving the investment and the government of the home of the investor.

IIAs are categorized in two types: (i) bilateral investment treaties and (ii) treaties with investment provisions. A BIT is an agreement between two countries regarding the promotion and protection of investments made by parties from the respective countries in each other’s territory. They are international agreements establishing the terms and conditions for private investment by natural and legal persons of one state in another state. The great majority of IIAs are BITs,⁸⁷ and this section will focus on those, and in particular on model BITs proposed by governments, as those are the types of international investment agreements where relevant gender provisions are currently being developed.

There are clear linkages through which trade and investment policies and agreements can affect gender dynamics. Negotiators of international trade agreements have progressively included the discussions on gender provisions or gender chapters in free trade agreements (FTAs). Both individual provisions and chapters mostly cover issues ranging from cooperation activities to institutional arrangements, including the establishment of a trade and gender committee and consultation procedures. Other gender-related provisions can be found spread throughout the text of an FTA – in the preamble, in chapters on labour, on investment, on cooperation, on sustainable development, or on small and medium-sized enterprises (SMEs).⁸⁸ Although mostly welcome and in continuous development, so far the commitments that address gender through those instruments are mostly aspirational. It is worth noting that a few FTAs contain binding and enforceable gender-related provisions, with the US–Mexico–Canada agreement (USMCA) being the most recent one, notably in Chapter 23 – Labor.⁸⁹

On the other hand, in the realm of international investment agreements, very few model BITs currently include gender provisions. Even when they do, these provisions do not impose binding obligations on corporations. Out of eighty-four model agreements published online by the United Nations Conference on Trade and Development’s (UNCTAD) Investment Policy Hub,⁹⁰ only seven explicitly address gender, albeit through broad provisions that refer to ‘fair and equitable treatment’ between men and women.⁹¹

Among the few examples of countries that have submitted model BITs containing gender provisions are the Netherlands (model revised in 2019)⁹² and Canada (model revised in 2021).⁹³ Amid the interesting changes introduced by the Netherlands, the 2019 model agreement includes a commitment to promote equal opportunities and participation for women and men in the economy. The preamble recognizes the importance of gender equality in international trade and investment policies, and Article 6, paragraph 3 of the model agreement underscores ‘the importance of incorporating a gender perspective into the promotion of inclusive economic growth’ and that ‘Contracting Parties commit to promote equal opportunities and participation for women and men in the economy’.

More recently, in May 2021, the Government of Canada introduced its model BIT with several provisions addressing gender issues. Among the main changes included in this model, Canada highlights provisions on gender equality, including ‘a number of new provisions that aim to help women and other groups benefit more from the agreements, and to ensure that investment protections do not impede policies promoting gender equality’.⁹⁴ Special attention in that regard should be paid to Article 3 (Right to Regulate), Article 8 (Minimum Standard of Treatment), and Article 16 (Responsible Business Conduct).

The Dutch and the Canadian model BITs are relevant because they set the scene for a new generation of IIAs, as they highlight the importance of incorporating a gender perspective in the promotion of inclusive growth and equal opportunities between men and women. Previously, when investment agreements mentioned gender, they mostly focused on gender equality in arbitral dispute resolution and the gender division among arbitrators. This seems to be changing in light of the recent model BITs, but the impact of investment treaties and foreign direct investment on gender equality are notions that need to have more concrete ground in international investment treaties.

It is worth noting that having gender provisions in government model BITs is not a precondition for signatories to include gender provisions in the BITs they negotiate and sign. In fact, a quick overview in the most recently signed BITs in force⁹⁵ shows that there is little correlation between countries that addressed gender in their model BITs and countries that signed BITs addressing gender. For example, whereas Brazil stood out as one of the few countries whose recent model investment agreement did not address gender, the government addresses the issue in most of its recently signed investment cooperation and facilitation treaties.⁹⁶ Conversely, whereas Morocco’s 2019 model BIT⁹⁷ addressed gender, its most recent BIT – signed with Japan in August 2020⁹⁸ – does not.

9.4 FDI Can Be the Driver of Necessary Changes

The private sector can have a very active role in promoting gender equality, and investment policies by MNEs can be conducive to creating more employment opportunities for women.⁹⁹ FDI inflows can lead to more opportunities for women in the job market but may also exacerbate disparities. In fact, according to Blanton and Blanton, ‘traditional arguments about the linkages between socio-political factors and FDI – particularly in developing countries – anticipate an inverse relationship between the rights and welfare of women and foreign investment’.¹⁰⁰

FDI can be the driver of necessary changes and although it would be natural to believe that a rise of trade and investment in the economy would lead to more opportunities for women, studies consistently show that trade and investment policies are not gender-neutral. While the current trade and investment paradigms are supposed to increase growth, decrease inequalities and promote employment, evidence shows (especially in developing countries such as those in Latin America and the Caribbean) that a more globalized economy and a boost of foreign direct investment by MNEs may increase inequalities, ‘especially across sectors, income, gender and social groups’.¹⁰¹

When planning and implementing investments in a foreign country, MNEs can set the tone and go beyond the gender provisions where they exist in domestic legislation and IIAs. In fact, corporations’ gender policies have in many ways led the efforts to raise awareness around the inequality with which women are treated in the workforce in all regions of the world.

9.4.1 What Women Need

Implementing employment policies that create an enabling environment for men and women can improve companies’ access to talent as well as employee retention.¹⁰² Offering flexible work arrangements and using governmental programmes to promote gender equality within the organization are strong contributing factors to improve the working environment for women and to create more opportunities for them.¹⁰³

Access to training, mentorship, and professional development can help women rise, enhancing their leadership and decision-making skills.¹⁰⁴ Increased purchasing power for women leads to more women purchasing from and investing in companies that take their social impact into account.¹⁰⁵ Furthermore, companies whose workforce uses advanced technologies tend to be more equitable in terms of gender.¹⁰⁶ In a study carried out in Mexico, the introduction of computer technology helped ease the physical effort required by women in blue-collar jobs.¹⁰⁷ This led to a higher female participation rate and higher relative salaries.

9.4.2 Initiatives by Corporations in the Americas

MNEs can go beyond the requirements imposed on them by domestic legislation and IIAs. For example, by imposing their own quotas for women’s representation at senior managerial levels, their investment practices will be aligned with UN Sustainable Development Goal 5 on gender equality.¹⁰⁸ As a result of the COVID-19 pandemic, several corporations have implemented measures to address the struggle employees were facing due to the increase in their domestic responsibilities. As an example, Microsoft introduced different parental leave programmes for parents with children at home due to school closures and online learning.¹⁰⁹

Some may claim that corporations are opportunistic, using human rights rhetoric, including that of gender equality, as part of their marketing strategy.¹¹⁰ However, regardless of the intentions behind the actions of corporations, these initiatives have positive business outcomes for the company as well as social outcomes, including raising awareness about these issues. By prioritizing a diverse and inclusive work environment, MNEs can have a positive impact on the lives of women employees as well as women in the communities where the MNEs operate. Finally, these transformative actions can benefit society as a whole by driving the development of local communities and national economies.¹¹¹

An example of an MNE that is implementing interesting projects in Latin America and the Caribbean is United Parcel Service (UPS). In 2021, UPS launched its Women Exporter programme in fifteen countries in Latin America, including Mexico, Chile, and Barbados .¹¹² The corporation has committed its resources and industry know-how to empower women through the programme, assisting small or medium-sized enterprises with international trade and e-commerce. Another example is ExxonMobil, which works with Vital Voices, to support advanced training for women business owners in LAC and other regions. Since 2005, the corporation has had global gender policies to help women around the world invest in themselves and their communities.¹¹³

Unilever has had a strong presence in the region and beyond, adopting internal gender policies – it supports and works with United Nations (UN) Women in Latin America. In 2021, the corporation celebrated the fact that Unilever Colombia achieved gender balance on its board of directors, with 50 per cent of the positions held by women. Unilever also closed the gender gap in managerial roles, with 53 per cent of managerial positions covered by female talent. This is the largest representation of women in leadership positions in the history of the company in Colombia.¹¹⁴ Moreover, the corporation intends to generate better living conditions for women in its extended chain in Colombia through programmes such as Shakti – an inclusive micro-distribution project through which the company offers training and additional income opportunities. This initiative has already benefited more than 10,000 Colombian women – most of them heads of household – in 463 rural localities around the country.¹¹⁵

9.5 Concluding Remarks

The future of the international economic order is contingent on the ability of governments and the private sector to distribute the benefits of economic growth equally to all.¹¹⁶ Maximizing the benefits for women in terms of FDI by MNEs requires action from both the public and private sectors, at the national and the international levels. The mere existence of gender provisions (and maybe chapters) in IIAs does not guarantee that gender concerns will be implemented and enforced at the firm level, the policy level or through domestic legislation.

Public, private, domestic, and international investment policies are of fundamental importance to further women’s economic empowerment, creating opportunities for employment, entrepreneurship, and inclusive growth. Domestically, legal reform and enforcement of gender policies by local governments in the countries where an MNE operates is crucial. As discussed previously in scholarship,¹¹⁷ legal frameworks around the world have vastly improved in terms of the rights granted to women, but there is still much room for growth. Research shows that focused domestic legal reform leads to smaller gender gaps and higher investments, together with societal and economic benefits.

MNEs in the private sector have been leading this change around the globe in many respects. With gender policies focused on the composition of boards, for example, corporations have been changing the decision-making landscape for the past years. However, especially when talking about foreign investments in different countries, many initiatives are still needed in the private sector to create an enabling environment for women as well as opportunities to attract, train, retain, and promote women.