TRADE-DEVELOPMENT: WTO Will Try Not To Forget The Small Traders

By IPS Correspondents Reprint | | Print |

Shada Islam

GENEVA, May 20 1998 (IPS) - World trade ministers Wednesday agreed to step up plans to further free up global markets, but promised not to forget that some nations lack the economic strength to keep up with the pace of change forced by the major trading powers .

The World Trade Organisation’s 132 countries issued a carefully- worded declaration that tried to balance the interests of trading giants like the United States and the European Union with the demands made by the agency’s less commercially powerful member s.

The short statement celebrated the 50 years of the multilateral trading system but — in response to complaints made by developing nations and non-governmental agencies — admitted that more needed to be done to “enable all the world’s peoples to share fully and equitably in these achievements”.

After three days of discussions, world trade ministers also pledged to keep their markets open and said they would not be imposing customs tariffs on goods and services traded on the Internet.

Ministers voiced their “deep concern over the marginalisation of least-developed countries and certain small economies” and also recognised the urgent need to address the chronic foreign debt problem facing many of them.

Significantly, for the first time, the WTO also acknowledged the important of “enhancing public understanding of the benefits of the multilateral trading system” and said it would try and improve the “transparency” of its operations.

For most of the three days, WTO members debated the pros and cons of launching a new market-opening round, with the European Union (EU) and the U.S. insisting that there must be a new trade liberalisation push worldwide but disagreeing on whether this sh ould be done through separate sectoral discussions or within a comprehensive global round.

The EU used the meeting to campaign for a so-called ‘millennium round’ of trade liberalisation talks while U.S. president Bill Clinton warned that Washington wanted to keep any future talks short and sweet.

Most developing nations, meanwhile, warned against the opening of a new round, saying their first priority must be to implement existing commitments.

Given the divergences, the final compromise does not talk about starting a new trade round, with ministers only stressing the need for “further liberalisation” and promising that this will be “sufficiently broad-based to respond to the range of intere sts and concerns of all members.”

“Every option has been left open,” WTO Director General Renato Ruggiero told a final press conference. The WTO chief admitted that for many of the agency’s members, “there must be an emphasis on implementation before the launching of a new trade initi ative.”

There was also no common position on the issues that would be discussed in the new talks, Ruggiero said. Most developing countries agree that there must be new liberalisation talks on agriculture and services, following commitments made in the Uruguay Ro und which ended in 1994.

But, there is opposition to opening talks on subjects like investments, competition policy and government procurement that are being dealt with by WTO working groups following the ministerial meeting held in Singapore in December 1996.

EU officials, however, voiced their determination to use the months ahead to convince developing nations that launching a new broad-based trade round was in their interest.

Preparations for the new round will start at a WTO meeting in September 1998. But the final decision on launching the new trade talks will only be taken at a special ministerial meeting of the WTO to be held in autumn 1999 in the United States.

Martin Khor of Third World Network warned that developing nations would have to work very hard to resist renewed market-opening pressure from the EU and the United States.

“The momentum can be stopped but developing nations will have to get their act together,” Khor warned. “If they can’t they will only have themselves to blame.”

Khor insisted that governments in the south would have to “pour resources” into preparing their position ahead of the future WTO meetings. If not, they risked being bullied into making concessions, Khor warned.

Trade union groups and ecologists are insisting that labour standards and environmental norms should also be raised in the new talks.

“We will be looking for concrete results within the next six months on increased transparency and environmental reform at the WTO,” Sabina Voogd of Greenpeace International told reporters.

The International Confederation of Free Trade Unions said that calls made by Clinton, South African leader Nelson Mandela and British prime minister Tony Blair for closer WTO scrutiny of labour standards must also be followed up rapidly.

“These leaders have thrust labour issues to the fore of the world trade debate,” Bill Jordan, general secretary of the ICFTU insisted. Ruggiero told reporters that he would be consulting regularly with the International Labour Organisation on promoting respect for workers’ rights.

Ruggiero also promised more transparency in the agency’s operations, saying he understood there was a pressing need for a “dialogue with civil society.”

He admitted that demonstrations by anti-free trade activists during the three day talks had helped draw WTO attention to the need for closer consultation with non-governmental organisations.

But, Ruggiero warned that organising such a dialogue would not be easy given the “number and complexity” of the people that were demanding a say in WTO operations.

Both Mandela and Clinton insisted in their speeches to the WTO that the agency must assume a more “human face” and take its free-trade case to people across the world.

Despite some initial resistance, developing countries agreed with proposals from the United States, Japan and the European Union to keep electronically-traded goods and services free of tariffs and duties.

Trade officials said the tariff “standstill” on electronic transactions would be reviewed at the WTO ministerial meeting next year.

They also said that future WTO negotiations on establishing firm rules for electronic commerce would take account of the economic, financial and development needs of the world’s poorer nations.

Several non-governmental agencies, however, denounced the cyberspace deal, saying the EU and the U.S. had “sneaked in” the Internet agreement which “jumped over” the interests of developing countries.

Activists also warned against bringing discussions on liberalising the cross-border flow of investments into the WTO.

Negotiations on a so-called “multilateral agreement on investments” stalled at the Paris-based Organisation for Economic Cooperation and Development last month, largely because of opposition from citizens’ groups.

But, non-governmental trade experts said there was a danger that the EU would try and push the subject on to the WTO agenda.