Developing countries are key to a successful new trade round
By Maria Livanos Cattaui
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| Developing countries want better access for their agricultural products |
Paris, 27 July 2001 - All the big players want an ambitious new global round of multilateral trade negotiations if the pledges coming out of the United States, the European Union and Japan are anything to go by. But that will not be enough to guarantee success when the World Trade Organization meets in Doha, Qatar, in November.
While little can be achieved without the determination of the US and the EU to contain transatlantic trade disputes and to strengthen the rules-based multilateral trading system, they are by no means the only ones who have to show willingness.
The world cannot afford a repetition of the failure of the previous WTO meeting in Seattle at the end of 1999. That would put at risk the trading system itself, which has driven economic growth and integration over more than half a century. Since 1950, all countries have benefited from a 17-fold rise in world trade and a six-fold rise in world output as the trade barriers came down at the behest of eight successive trade rounds.
Power relationships in trade diplomacy have changed. Almost three out of four of the 141 members of the World Trade Organization are from the developing world. They want to be sure that they get a square deal - something most are convinced that the previous Uruguay Round did not give them. They are resolved to be more assertive than in the past in pursuit of their interests, and who can blame them?
If the developing countries are to sign on to new multilateral trade negotiations, they will do so only if they can be confident of gaining more generous access to the markets of the industrialised countries, especially for products in which they have a competitive advantage, like agricultural products and textiles. And they will expect help in implementing undertakings they made under the previous Uruguay Round.
As the world economy falters, the shot in the arm that further progress on trade liberalization will bring is badly needed. Commitments to launch a new trade round voiced jointly by President George W. Bush and European leaders at the Gothenburg summit last month need to be borne out by flexibility at the negotiating table and a willin
gness to accept trade-offs. That is why the International Chamber of Commerce and other business organizations are pressing for a broad-based round with sufficient scope for bargaining.
All WTO members will have to muster political will and readiness to compromise over the next few weeks, for time is running out. The not-so-small matter of an agenda remains to be thrashed out before the Qatar ministerial meeting. Getting the agenda right will be crucial to the success of any new negotiations, whether or not they are graced with the name of a "round".
How ambitious should the agenda be? Should it focus on market access for agricultural and industrial goods and for services, or should it be extended into trade facilitation, rule making for investment and other potentially contentious areas? Governments should aim for a manageable agenda that can bring concrete results within two to three years.
Pending the outcome of the preliminary work by trade diplomats in Geneva, everyone concerned should be mindful of broader considerations beyond purely trade and economic issues. Peace and economic progress in vast areas of Africa, Asia and Latin America will be strengthened by a new trade agreement that enables the developing countries to take full advantage of global economic integration and reduces the sense of marginalization that many of them feel.
This is not to say that trade is a magic bullet that will vanquish wars and revolutions, lawlessness and misrule. But it is surely true that trade and investment are far more potent than aid - which anyhow is declining - in helping developing countries to overcome poverty, the root cause of so much political instability. The link between trade and economic progress is undeniable - witness a recent WTO study showing that the poor countries that are most open to trade are the ones having the greatest success in catching up with rich nations.
If new trade negotiations lead to an agreement that covers the aspirations and interests of the developing countries as well as those of the industrialised world' heavy hitters, the entire world community stands to benefit. Qatar has to succeed.