.contact us |.about us
News > Business News ...
WTO facing tough decisions in Cancun
( 2003-09-10 08:12) (China Daily)

The very weight of the World Trade Organization (WTO) justifies the enormous challenges facing negotiators at each round of trade talks.

Yet, decisions to be made at the Fifth WTO Ministerial Conference that opens today in Cancun, Mexico, will be crucial to translating the development promise of the Doha Agenda into reality.

The main task of the five-day Mexico summit is to take stock of progress in negotiations and other work under the Doha Development Agenda. These negotiations are expected to conclude by the agreed date of January 1, 2005.

The Doha round of trade talks was launched in the Qatari capital city in late 2001 with the primary goal of giving developing nations bigger benefits from trade.

Developing countries account for three quarters of the 146 WTO members, but their concerns were largely being ignored until the latest round of world trade talks - dubbed the "development round."

Though the WTO adopted an one-vote-for-each-member mechanism in trade talks, developed countries have capitalized on their political and economic might and negotiation skills to tilt the field in their favour.

The Doha Agenda responded to the unfairness in the global trade order, but failures of negotiators to meet early deadlines on agriculture and other issues important to developing countries have evoked strong suspicion about whether or not the development commitments made in Doha will ever bear fruit.

Such failures are an expensive error for long-term development of the world economy which, to a large extent, hinges on the reduction of inequities in international trade.

Developed countries' stubborn resistance to making substantial concessions is the main reason for the lack of progress in trade talks.

However, some recent changes in rich members' stance toward the Mexico summit give more than a ray of hope to proponents of the world trading body.

The possibility that the Cancun talks may turn out to be a milestone in the course of globalization seemed far-fetched just a month ago when rich countries were still wrestling with each other to avoid sharp cuts to their farm subsidies.

Many developing countries have complained European farm over-production fed by huge state subsidies distorts world prices and undercuts their agricultural goods.

Nevertheless, in the run-up to the Cancun talks, efforts to quell scepticism and rekindle free trade talks were suddenly gaining ground.

In mid August, the two heavyweight WTO members - the EU and the United States, which last year increased its farm subsidies by US$57.1 billion, or 67 per cent, over six years - agreed on a joint plan to cut farm payments, subsidies and tariffs.

And a deal the WTO reached at the end of last month that made it easier for poor nations to import cheaper generics made under compulsory licensing was another good omen for the Cancun talks. Such a historic agreement proves not only the WTO's capacity to serve mankind, but also its members' willingness to compromise for the overall progress of world trade.

With such new-found faith in the WTO, it is therefore urgent for all negotiators to make last-ditch efforts with adequate flexibility to build on the momentum of fair trade liberalization.

At the heart of the success of the Cancun talks is a long-anticipated breakthrough in farm talks which is expected to lower barriers on global trade while granting enough protection for the poorest states.

For that to happen, participants must beat the odds to make firm compromises between each other.

Admittedly, conflicts of interest between developing countries and rich ones remain so huge that the difficulties confronting negotiators are no less daunting than those in previous trade talks.

But at present, the WTO does not have the luxury of doing nothing. Rich nations must not be allowed to respond to problems with excuses instead of action.Time for a new global trade accord to be achieved by 2005 is running out.

Adoption of a framework approach to modalities in agriculture and non-agricultural market access is a much-needed effort to save the stagnated Doha round of trade talks.

A report the World Bank released earlier this month highlighted the potential rewards of a successful new world trade agreement.

The World Bank estimated that eliminating tariffs on all goods would boost world income by US$832 billion, with 65 per cent of that benefit flowing to developing countries.

It also forecast that a good deal to liberalize trade could lift 144 million people who earn less than US$2 a day out of poverty.

Given the fact that a cow can lap up US$2.5 a day in subsidies in some developed countries nowadays, the needs of developing countries should, by no means, be seen playing second fiddle to rich nations' protection of their farmers.

A freer and more fair trade environment will prime the global economic pump and thus benefit all WTO members.

Granted, establishing a fair global trade order takes time, and changes to the existing trade rules cannot be done overnight.

For the moment, it is important that developing countries' interests find representation and are protected in and beyond the Cancun talks.

  Today's Top News   Top Business News
+The next great leap after Shenzhou V
( 2003-10-21)
+Hu calls for balanced development
( 2003-10-21)
+Report: SARS not airborne virus
( 2003-10-21)
+Japan urged to resolve weapons issue
( 2003-10-21)
+Int'l AIDS group opens Beijing office
( 2003-10-21)
+Home-appliance giants want wheels
( 2003-10-21)
+Exchange-rate reform under study
( 2003-10-21)
+Health insurance sector called for
( 2003-10-21)
+SanDisk teams up to open outlets
( 2003-10-21)
+Housing prices start to sag in Shanghai
( 2003-10-21)
  Go to Another Section  
  Article Tools  
        .contact us |.about us
  Copyright By chinadaily.com.cn. All rights reserved