This is the main conclusion of a United Nations Development Programme report which focuses on the impact of trade liberalisation on people's lives in the region and will be released today in Phnom Penh.

The UNDP's Asia-Pacific Human Development Report 2006, titled 'Trade on Human Terms', is the first comprehensive study of the fallout from trade liberalisation in the world's most rapidly expanding region.

'The report is an attempt to demystify trade, to look at it through the human development lens,' the international organisation's Asia-Pacific director, Hafiz Pasha, said in New Delhi on Monday.

'It is the product of indigenous thinking by hundreds of people in the region, and it not only analyses the ground situation but offers a bold, eight-point agenda for dealing with the new challenges.'

The report has come up with proposals to develop a strategy that 'effectively combines trade liberalisation with the promotion of poverty reduction and human development'.

The report points out that far fewer jobs were created in the Asia-Pacific region in the 1990s - 176 million - compared with 337 million in the 1980s. As a result, overall unemployment increased from 3.9 per cent to 6.3 per cent, even though manufacturing output went up by almost 180 per cent in the 1990s.

The problem of 'jobless growth' has been acute in East Asia, especially in manufacturing, with the worst scenario in high-trade countries, such as China and Singapore, where unemployment rates rose substantially. The principal cause is the shift in manufacturing from low-tech, labour-intensive industries, such as garments, to hi-tech and capital intensive ones, such as electronics.

To make matters worse, most of the burden of unemployment has fallen on young people: in 2004, while those aged 15 to 24 made up one-fifth of the region's labour force, they constituted nearly half of the unemployed. Women too have lost out: in most countries their unemployment rates are higher than men's.

One of the most disturbing outcomes of the rapid increase in trade, says the report, has been the rise in income inequality.

'Countries which have grown faster have become unequal faster,' Mr Pasha said. 'And in China, the gap between the rural and urban [populations] has increased phenomenally.'

Nevertheless, the report shows a substantial decline in poverty: between 1990 and 2001, the number of people living on less than US$1 a day dropped by nearly a quarter of a billion. But less developed countries have had little success - 38 per cent of the population in these countries still live below the poverty line, compared with 22 per cent in the more developed.

'Two-thirds of the world's poor are in Asia,' Mr Pasha pointed out.

Liberalising agricultural markets may have helped reduce the price of food - particularly if the crops are produced with the backing of agriculture subsidies in the US and EU, says the report. But this has not translated to more food security. Many more countries had food deficits, and Asia still has more hungry people than any other region - more than 510 million.

The report takes governments in the region to task for neglecting agriculture and investing far less in rural development. The most striking evidence of this has been a serious deterioration in the balance of agricultural trade - from an overall agricultural trade surplus of nearly US$7 billion in the 1960s, developing countries in the Asia-Pacific have become net importers, with a deficit of US$11 billion, for instance, in 2001.

But unlike agriculture, the news from the textile and clothing sector has been positive. Last year, the first year without quotas, China and India have been the main winners while Cambodia, Vietnam, Indonesia, Sri Lanka and Bangladesh have been able to maintain or even marginally increase their shares.

There have been losers too - mainly the Philippines, Thailand, Nepal, and Pakistan. In numbers though, the picture is heavily tilted towards China.