While the last decade of the 20th century saw great economic progress in many parts of the world, it also witnessed stagnation and setbacks. An estimated 1.2 billion people still live on less than one US dollar a day. A fifth of the world’s people living in its richest countries share 86 per cent of its GDP, the poorest fifth just 1 per cent – and the gap between them continues to increase. These differential effects of trade and investment on development and poverty reduction show that while economic growth is of central importance, its quality is the key for sustainable development. Both the sources and the patterns of growth also shape development outcomes.

National and international policy frameworks need to be broadened to integrate the social, economic and environmental dimensions of sustainable development, in a democratically accountable and equitable way.

The links between trade and the environment are important, but multiple and complex. The growth and liberalization of trade are neither necessarily good nor bad for the health of the planet. They can cause resources to be used more efficiently and create wealth that can be used to protect the environment. However they can also increase trade-related pressures that contribute significantly to natural resource depletion and environmental degradation.

The challenge is to manage the processes of trade liberalization and globalization in a way that promotes environmental sustainability and equitable human development. In short, the more integrated environmental, trade and other economic policies are, the more sustainable will be economic growth, and the more positive will be the contribution of globalization to the environment and sustainable development.