Plenty of jobs if trade barriers would fall

If all countries were to reduce supply chain barriers, world GDP could increase by 2.6 trillion dollars or by 4.7 per cent and world trade by 1.5 trillion dollars or 14.5 per cent. Using empirical employment simulation models, consultants from Bain & Comany and the world bank claims that such a 4.7 per cent increase in GDP could also produce a global rise in employment of up to 110 million jobs— even a more modest GDP increase of 2.6 per cent could potentially generate up to 23 million jobs.

Trade regulations such as rules on local content, different export/import licenses and delays at border crossings disrupt the smooth flow of goods. The result is wasted resources. Obstacles are especially acute for small and medium-sized businesses that don't have the money to cover upfront costs or don't sell enough overseas to justify the investment needed to understand different nations' regulations. If nations worked together to reduce barriers and standardise regulations then the study from Bain says freer flow of trade could increase world exports by 14.5 per cent, or an additional 1.6 trillion dollars.

(03|2013) Source: Bain