From Factory to Fallout: Global Inequality Crisis and WTO at Cross Roads in the Anthropocene

The Anthropocene, marked by significant human impact on Earth's ecosystems, has intensified global inequalities, particularly through global value chains (GVCs). GVCs, which fragment production across multiple countries, have spurred economic growth but also deepened disparities, especially in the distribution of environmental and economic benefits. This paper examines how GVCs contribute to world inequality, focusing on environmental degradation, labor exploitation, and the uneven distribution of economic gains. High-income countries capture most of the value generated by GVCs, while low-income countries often remain confined to low-value segments, facing environmental harm and poor labor conditions.

The World Trade Organization (WTO) plays a crucial role in this dynamic, as it sets the rules for international trade, often prioritizing market access over labor and environmental standards. Although the WTO has launched initiatives to promote sustainable development, its overall impact on reducing global inequality remains limited. The paper argues that the current structure of GVCs, supported by WTO trade rules, reinforces existing inequalities and contributes to environmental degradation.

To address these issues, the paper recommends reforming WTO trade rules to integrate stronger labor and environmental standards, promoting fair trade practices to ensure a more equitable distribution of value along GVCs, and aligning WTO policies with the United Nations Sustainable Development Goals (SDGs) to reduce inequality and promote sustainability. These reforms are essential for creating a more equitable and sustainable global economy in the Anthropocene.