Building capacity to utilize trade policy for human development

Research areas: Social Transformation

Duration: December 2009 - March 2010

Achieving high rates of economic growth is not the only condition to improve the welfare of people. According to the human development concept, the improvement of quality of life (access to the basic health service and education), the nature of income distribution (evenness of distribution, the share of low-income categories of people), ensuring of fundamental freedom and human rights, providing everyone with the individual choice in all aspects of life are also crucial aspects. Along with the level of real per capita income all the factors mentioned above matter in defining the real welfare of the population.

Thus, the restructurization of the economy, the change of volume and structure of foreign trade could serve as the most significant fact in achieving long-term sustainable rates of economic development, real income and human development indicators. The low share of goods with high value added in total volume of exports of the country does not only prevent the growth of the real per capita income, but also causes the macroeconomic vulnerability on the volatile world prices of the commodity goods, which in turn, could have a negative impact on human development indicators.

Therefore, it is important to assess the effectiveness of trade policy as one of the factors of human development. The objective of the study is to analyze the impact of foreign trade policies on human development and to determine main directions of its improvement to achieve the increase of human development indicators.