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LDCs Seek Mini Trade Deal

Sanjay Suri

ISTANBUL, May 11 2011 (IPS) - Leaders from the Least Developed Countries are making a strong push in Istanbul for a mini trade deal for their 48 impoverished nations – ahead of any worldwide agreement under the Doha Round.

Valentine Rugwabiza, deputy director general of the World Trade Organization (WTO) speaks with IPS. Credit: Sanjay Suri/IPS

Valentine Rugwabiza, deputy director general of the World Trade Organization (WTO) speaks with IPS. Credit: Sanjay Suri/IPS

“That is one of the options that is being discussed,” Valentine Rugwabiza, deputy director general of the World Trade Organization (WTO) told IPS in an interview Wednesday. “But there are a number of options that are being discussed, and beyond discussions of those options, there will now also be a need to have agreement among members.”

Leaders from the Least Developed Countries (LDCs) are said to be looking for some kind of deal to fall in place by the end of the year – they aim to secure a pledge of commitment towards that goal at the Fourth U.N. Conference on the Least Developed Countries (LDC-IV) under way in Istanbul this week. The conference is held every ten years, and the LDC leaders consider this a critical moment to secure their demands.

These demands have been put across strongly, says Rugwabiza, who is from Rwanda – an LDC. “They are frustrated about the length of these (WTO) negotiations. A clear sign of that is that they are saying that if the round cannot be completed this year, then we need something, we need results for the LDCs.”

The Doha Round of multilateral trade negotiations was launched by the WTO in November 2001. The talks have now slowed to almost a halt, and the rise of emerging Southern economies has made the donor-client rhetoric of many players increasingly irrelevant.

LDC leaders, Rugwabiza says have sent a “clear and strong message” that they are “frustrated by the current situation, by the impasse, and by the prospect that in 2011 maybe they will not get the big package that they wanted”.

But at the same time, she said, there is a “clear resolve that we are not ready to accept no results. Because we are also members of this organisation (WTO), and we will simply not accept no results.”

Rugwabiza sums up the arguments being made by heads of many of the LDCs. “[They say] after all we represent only one percent of global trade. If because of disagreements among major players – developed or emerging developing countries – that we cannot reach an agreement this year, we cannot afford to continue to wait infinitely. Because time does not have the same cost on our and your economies.

“We are not at the origins of this impasse, we are not the ones preventing the round from progressing, but we are the ones who are going to pay the highest cost. In an environment which is deteriorating not because of us, but because of the crisis that was not of our making.”

Rugwabiza says the LDCs are emphatic that they want a multilateral trade agreement and that regional and bilateral deals are no substitute for that.

“A number of presidents are coming with a very clear and loud message that the multilateral route is their avenue for multilateral trade rules. They are not ready to leave the multilateral platform of negotiations.”

That affirmation seems to have come with veiled warnings.

“There is at this stage a broad consensus around the specific circumstances LDCs are faced with – but there is also an interest of all members to maintain LDC commitment to the system,” says Rugwabiza. “[They say] their involvement and commitment has been very useful, they have contributed in a very constructive manner, they have put a number of proposals that are today a part of the Doha Development Agenda. Proposals on disciplines regarding cotton, proposals on more flexible and simplified rules of origin, that are much more of a barrier than tariffs for a number of LDCs.”

The LDC leaders are saying they clearly have had enough. Their argument, says Rugwabiza, is that they have so far struggled “in an environment that was not necessarily the most conducive, the most supportive, in an environment where we still have a number of barriers, a number of disincentives to adding value to our products, in an environment where we still have tariff peaks, we are still faced with tariff escalation, in an environment where we are still faced with subsidies, and in an environment where we are still faced with lack of predictability.”

Zambian President Rupiah Bwezani Banda, for instance, told a meeting on trade that the “concerns of ACP [African, Caribbean and Pacific states – many of them LDCs] have not been fully addressed, though discussions have reached a critical stage”. In private meetings with WTO officials, many leaders are reported to have been far more blunt.

Many critical rounds of talks have been held between LDC leaders and WTO chief Pascal Lamy in Istanbul. The LDC meeting is not formally a part of WTO negotiations, but trade has been at the heart of talks here.

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