Trade talks are now more urgent, WTO’s chief
Jan 31, 2007
THE World Trade Organisation (WTO) director general, <b>Pascal Lamy</b>, will be in Uganda from February 2 to 3. With contention high among members over trade relation, Lamy is holding consultations to help beat off a stalemate. We spoke to him about the visit.
THE World Trade Organisation (WTO) director general, Pascal Lamy, will be in Uganda from February 2 to 3. With contention high among members over trade relation, Lamy is holding consultations to help beat off a stalemate. Joe Namspoke to him about the visit.
QUESTION: What brings you to Africa and to Uganda?
ANSWER: My visit to Uganda is part of my ongoing consultations with WTO members on how to move the WTO trade talks forward. Uganda has one of the most dynamic economies on the continent and has demonstrated leadership throughout these negotiations. I am here to consult on how we can bring the Doha Round to a successful conclusion that will secure the developmental benefits to Africa and Uganda in particular.
Two weeks ago, I was in Addis Ababa attending a meeting of African Union trade ministers, who reiterated the importance that Africa attaches to the Doha Development Agenda and the potential for trade to contribute towards the achievement of the continent’s developmental goals.
WTO has been described as a non-democratic body used by rich nations to further their interests. What is your view?
The WTO currently has 150 members and about two-thirds of these are developing countries.
Decision-making is by consensus and as such, the possibility of any one country or group of countries imposing their will on the majority is practically impossible.
The WTO does not have a Security Council. Obviously, consensus building amongst 150 countries, with sometimes conflicting interests, is not easy and requires a lot of time and diplomatic efforts.
Legitimacy may have a cost for efficiency but that is the price for democracy, and I believe it is worth paying it.
Why did the Doha Round talks collapse?
We reached a deadlock in the negotiations, in particular on the reduction of agriculture subsidies and tariffs.
We then decided to suspend the negotiations to give the trade ministers time out to reconsider how they can narrow out positions. The US will have to make further moves in cutting agriculture subsidies.
The European Union (EU) will have to cut agriculture tariffs beyond their current offer and Brazil and India will also have to make their own contribution.
During this period, we have witnessed a lot of discreet diplomacy between these key players (US and EU) which I believe will soon translate into moves in their positions.
In the meantime, political leaders around the world, and in particular those in Africa, have warned of the serious consequences of failure.
They have clearly told the major players that a collapse of the Doha Round is not an option for Africa.
What is the way forward for the WTO?
At this stage, we need to see further moves from the EU, the US, Japan, India and Brazil.
It is now a question of weeks and not quarters or semesters. There has to be progress in agriculture and industrial products and on trade in services. All these areas have a strong development potential which needs to be tackled.
Take the issue of duty-free and quota-free treatment for exports from the world poorest countries. Or the slashing of subsidies and tariffs on cotton exports. Or the new rules to improve customs procedures and cut red tape.
All this will need to be part of the package.
The sooner, the better. At the same time, the parallel agenda to boost aid for trade, to address capacity bottlenecks is also progressing. 2007 needs to be a defining year for the WTO trade talks.
What is your view on the imminent agreement between the European Union and African Caribbean Pacific Countries under the Economic Partnership Agreements EPAs?
The EU-ACP negotiations under the EPAs are a bilateral issue among some WTO members.
Therefore, as a matter of principle, I cannot pronounce myself on this issue. My mandate only covers multilateral trade. There is no problem as long as they comply with multilateral rules.
What message do you bring for leaders and policy makers in this region?
The Doha Agenda is a development round: Africa has much to gain from it and Africa would be by far the biggest loser if it fails. Failure to reduce the trade distorting agriculture subsidies of the rich countries will mean a missed opportunity to boost the expansion of agricultural production in Africa.
This is particularly the case for cotton exporters that have witnessed a significant decline in production over the past years as a result of distortions in the cotton export market.
The reduction of agricultural tariffs whether in rich or emerging countries will also benefit African exports, particularly in those sectors where Africa has a comparative advantage including in cereals, vegetables and horticulture.
Addressing high tariffs and tariff escalation which affects African exports of processed agricultural products and undermine efforts to diversify agriculture exports will also be beneficial for this continent. Disciplines on fisheries subsidies will bring under control fishing practices of rich countries that have led to the current over fishing.
Any other message?
Trade is not enough to alleviate poverty on its own. But combined with a comprehensive aid-for-trade package such as the one currently under discussion in the WTO and well structured domestic policies, it can be an important instrument at the disposal of developing countries, Africa in particular. We must seize this opportunity.
QUESTION: What brings you to Africa and to Uganda?
ANSWER: My visit to Uganda is part of my ongoing consultations with WTO members on how to move the WTO trade talks forward. Uganda has one of the most dynamic economies on the continent and has demonstrated leadership throughout these negotiations. I am here to consult on how we can bring the Doha Round to a successful conclusion that will secure the developmental benefits to Africa and Uganda in particular.
Two weeks ago, I was in Addis Ababa attending a meeting of African Union trade ministers, who reiterated the importance that Africa attaches to the Doha Development Agenda and the potential for trade to contribute towards the achievement of the continent’s developmental goals.
WTO has been described as a non-democratic body used by rich nations to further their interests. What is your view?
The WTO currently has 150 members and about two-thirds of these are developing countries.
Decision-making is by consensus and as such, the possibility of any one country or group of countries imposing their will on the majority is practically impossible.
The WTO does not have a Security Council. Obviously, consensus building amongst 150 countries, with sometimes conflicting interests, is not easy and requires a lot of time and diplomatic efforts.
Legitimacy may have a cost for efficiency but that is the price for democracy, and I believe it is worth paying it.
Why did the Doha Round talks collapse?
We reached a deadlock in the negotiations, in particular on the reduction of agriculture subsidies and tariffs.
We then decided to suspend the negotiations to give the trade ministers time out to reconsider how they can narrow out positions. The US will have to make further moves in cutting agriculture subsidies.
The European Union (EU) will have to cut agriculture tariffs beyond their current offer and Brazil and India will also have to make their own contribution.
During this period, we have witnessed a lot of discreet diplomacy between these key players (US and EU) which I believe will soon translate into moves in their positions.
In the meantime, political leaders around the world, and in particular those in Africa, have warned of the serious consequences of failure.
They have clearly told the major players that a collapse of the Doha Round is not an option for Africa.
What is the way forward for the WTO?
At this stage, we need to see further moves from the EU, the US, Japan, India and Brazil.
It is now a question of weeks and not quarters or semesters. There has to be progress in agriculture and industrial products and on trade in services. All these areas have a strong development potential which needs to be tackled.
Take the issue of duty-free and quota-free treatment for exports from the world poorest countries. Or the slashing of subsidies and tariffs on cotton exports. Or the new rules to improve customs procedures and cut red tape.
All this will need to be part of the package.
The sooner, the better. At the same time, the parallel agenda to boost aid for trade, to address capacity bottlenecks is also progressing. 2007 needs to be a defining year for the WTO trade talks.
What is your view on the imminent agreement between the European Union and African Caribbean Pacific Countries under the Economic Partnership Agreements EPAs?
The EU-ACP negotiations under the EPAs are a bilateral issue among some WTO members.
Therefore, as a matter of principle, I cannot pronounce myself on this issue. My mandate only covers multilateral trade. There is no problem as long as they comply with multilateral rules.
What message do you bring for leaders and policy makers in this region?
The Doha Agenda is a development round: Africa has much to gain from it and Africa would be by far the biggest loser if it fails. Failure to reduce the trade distorting agriculture subsidies of the rich countries will mean a missed opportunity to boost the expansion of agricultural production in Africa.
This is particularly the case for cotton exporters that have witnessed a significant decline in production over the past years as a result of distortions in the cotton export market.
The reduction of agricultural tariffs whether in rich or emerging countries will also benefit African exports, particularly in those sectors where Africa has a comparative advantage including in cereals, vegetables and horticulture.
Addressing high tariffs and tariff escalation which affects African exports of processed agricultural products and undermine efforts to diversify agriculture exports will also be beneficial for this continent. Disciplines on fisheries subsidies will bring under control fishing practices of rich countries that have led to the current over fishing.
Any other message?
Trade is not enough to alleviate poverty on its own. But combined with a comprehensive aid-for-trade package such as the one currently under discussion in the WTO and well structured domestic policies, it can be an important instrument at the disposal of developing countries, Africa in particular. We must seize this opportunity.