Arancha González: ITC connects trade policy and field work
Arancha González, a Spanish national, served as Chief of Staff to Pascal Lamy, Director-General of the World Trade Organization, from 2005 to 2013. She was appointed Executive Director of the International Trade Centre (ITC) by United Nations Secretary-General Ban Ki-moon on 15 August. ITC is an organization whose main purpose is the economic development of small and medium-sized enterprises in the South.
Interview with Arancha González in her Geneva office.
How do you connect yourself with Geneva?
I enjoy living and working in Geneva because this city is both local and international. The lake reminds me of the Cantabrian Sea in the San Sebastian area of the Basque Country, the rural and mountainous area that I come from. Throughout my career, I have lived in small cities, as well as cities with strong regional and global influences. I attended the University of Navarra and the University of Carlos III in Madrid before I began working in Brussels for the European civil service. And then in Geneva, I gained a global vision of the challenges that affect countries around the world.
I think the gap between international Geneva and local Geneva is overestimated, a bit like the divide between the banks of the Rhone River or Pâquis and Genthod. But it is true that Swiss culture is not necessarily easy to penetrate. Expatriates also have a tendency to stay among themselves, which is a normal trend in human societies.
One could think of Brussels as more of an international city, but it is European above all. Geneva, by comparison, is more cosmopolitan. I realized this when I arrived at the World Trade Organization (WTO) General Council for the first time: I saw all the countries, brightly coloured clothing, all these people coming from different backgrounds. In Brussels I would have been working with the Finns and people from Luxembourg, but here, I was conversing with the Chinese and people from Burkina Faso!
What did you do before you started as head of ITC?
I started my career in the private sector, working for a law firm in Brussels in the field of consulting. I was primarily involved in trade law, international trade and public funds. At the time, there were many links between Germany and Spain because many Germans would purchase or merge with Spanish companies (like Volkswagen did for SEAT). This is where I had my first taste of economic reality and I became acquainted with market mechanisms and the business world.
Then I spent five years at the European Commission, in the field of anti-dumping. I travelled a significant amount and learned about the business world and the economics of different industries in Europe. In 2002, I became the spokesperson for Pascal Lamy, who was the European Union Trade Commissioner at the time. By taking that opportunity, I discovered a whole new world: the media world! It was a fun detour that showed me the power of a good story and how to use media to position public opinion. This was during the time of the Boeing litigation, growth hormones for beef and the steel disputes.
I also worked as an adviser for the European Union during the Iranian negotiation under Mohammad Khatami and for trade agreements with Latin America. I learned a lot when I was working for the European Union.
How did you end up in Geneva?
When Pascal Lamy was appointed as the Director-General of the WTO, he asked if I would become his Chief of Staff. Up to that point in my life, I had been to Geneva three times, once for litigation and twice with Pascal Lamy when he was European Commissioner. I never thought I would live there!
On 1 September 2005 I took my position at the WTO. I remember that day very well: I had driven from Brussels to Geneva the day before and I was wondering what on Earth I was doing. But I enjoyed working with Pascal Lamy so much that I wasn't going to miss that opportunity.
What do you think of the clichés about the United Nations?
I am a sincere believer in the civil service and it is not true that the United Nations is only slow, inefficient and bureaucratic. It can also be fast, efficient and of good quality. I have worked in both the private and public sectors, so I know both. I don't accept it when people say the public sector is ineffective. It's a question of attitude. We manage other people's money, so it is fully normal that there are checks and balances and rules.
How does ITC take action?
ITC is a hidden gem – too well hidden, as it is. It's a shame because ITC deserves more visibility. This organization is doing an amazing job, and it has a universal calling and willingness to work with all countries.
I would say that ITC connects trade law with field work. We are a development agency that promotes the economic development of small and medium-sized enterprises (SMEs) in the South. We are not in charge of regulating trade (as the WTO is) and we are not a think tank (as UNCTAD is).
We use public funding to increase the competitiveness and volume of SME exports in developing countries. Half of our work is in sub-Saharan Africa. To accomplish this, we provide market-intelligence tools and information about procedures to help SMEs better seize trade opportunities. We contribute to trade promotion through local chambers of commerce. We are working to improve SME competitiveness.
Do you have any concrete examples of field impact?
We turn good ideas into a reality. As part of the Ethical Fashion Initiative in Kenya, Ghana, Haiti and Burkina Faso, for example, we train women so they can become entrepreneurs. By providing support for accounting and tax matters, we enable artisans to become micro-entrepreneurs. Then we connect them to markets by working with brands or designers such as Stella McCartney or Vivienne Westwood.
Another example: in Ethiopia, we have two projects related to the leather industry. Twenty-five percent of the material comes from Africa, but only 12% of processed leather comes from the continent. So the question is: how to go from 25% to 12%? Well, it turns out that 13% of the pelts remain in remote communities because they slaughter the animals in a way that makes pelts useless. In terms of the final product, only 3% of the profits remain in Africa. There is a huge potential for development in this sector.
So: ITC works for development through trade?
What I want people to understand is that creating an entrepreneurial class using public funds is not charity. It is economic empowerment, with products from the South finding markets in the North and, increasingly, in the South, as well. This is about turning a good idea originating from the South into an industrial activity, allowing it to foster growth and reduce poverty.
Our mission stems from the trade and growth objectives of the post-2015 development agenda. We intend to assist SMEs in their development in order to increase economic growth and employment, with the ultimate goal of reducing poverty. The question that ITC asks is: what are the needs of our beneficiary countries? These are defined through dialogue with governments and local actors.
ITC complements microfinance. We provide tools, but no funds. I believe in platforms and clearing houses between entrepreneurs and transnational companies.
As Executive Director, what are your priorities?
I am landing in an organization that already has 50 years of history, activities and expertise. There have already been great achievements. I am not coming here to start a revolution. The challenge is to adjust supply to a growing demand.
I think SMEs from the South are an underused source of growth. We need to innovate in the solutions that we offer to develop SMEs in services, for example. One possibility is to further develop partnerships with emerging countries and the private sector. The purpose is to identify enterprises from the South that can be of interest for entrepreneurs and buyers from the North, and vice versa.
I would also like to increase ITC's visibility and give the floor to the beneficiaries, and explain our activity on the basis of people's histories and the reality in the field. I really think it is possible to turn traditions into economic activity – take the Ethical Fashion Initiative, for example. Entrepreneurs are tomorrow's actors, and they have the power to transform their lives through better knowledge of markets. We must learn how to communicate this.
One of your objectives is to strengthen ties with the private sector. Why?
Our donors are states and governments, and their budgets are under pressure. We therefore need to demonstrate more clearly than ever the impact of our work. Anything related to trade involves the private sector – and this is an area in which ITC has developed considerable expertise. About 300 people are working on this in our Geneva office. This is a sector that by definition believes in investment and economic empowerment. Tapping new markets is our way of thinking, and it has nothing to do with charity or philanthropy.
Corporate social responsibility has been on the rise for some time. Some call it the good conscience of companies. I am very pragmatic: whatever the motivation, it is the actual contribution that counts. In the corporate world, there are many efforts in this direction that can't necessarily be seen from the outside. Take, for example, the work that Zara and Danone have done. There are solidarity efforts, concrete projects for development. For example, the Qatar Foundation offers us sales channels for jewellery wrought in Jordan with our support.
I think that when the private sector becomes more conscious of opportunities to partner with businesses in the South, it will be a win-win situation for everyone. In Switzerland, the private sector could become more sensitive to the commercial challenges of the South. I will do my best to help.