Changes in global trade patterns increase global inequality towards Sustainable Development Goals

Abstract

Reaching the UN's sustainable development goals (SDGs) is influenced by a country's position in global value chains and its involvement in international trade. Here, we assess how changes in global trade patterns (CGTP) during 2004 and 2014 impacted 13 SDG indicators in 141 countries/regions which are further divided into four income groups. Trade pattern is characterized by the direction, composition, and magnitude of trade, indicating an economy imports what types (composition) and magnitudes of goods or services from where (direction). We find that CGTP aggravated socioeconomic and environmental inequality between countries in two ways: 1) the amount of indicators that significantly worsened due to CGTP decreased from 8 indicators (2004–2007) to 1 (2011–2014) for high-income and upper-middle-income countries, but increased from 5 to 14 for lower-middle-income and low-income countries; 2) CGTP led to a coupling of value added with most natural resource consumption and environmental pollution indicators for low-income countries, while they strengthened decoupling or reducing coupling for other countries. The findings imply one key to achieving SDGs is to address the inequality between rich and poor countries through implementing policy interventions that influence import and vertical supply chain thereby shifting the trade patterns towards environmental-economic decoupling in poor countries.