May 20, 1998
WTO HEAD ADVISES AGAINST PROTECTIONISM
Geneva, May 18 (IPS) -- World Trade Organisation chief Renato Ruggiero Monday warned nations to resist protectionist pressures, saying a strong multilateral trading system represented a "force for stability and cooperation" for the agency's 132 members.
Speaking at the start of a three day meeting called to fete the 50 years of the General Agreement on Tariffs and Trade (GATT) -- the trade agency which preceded the WTO -- Ruggiero said world trade ministers must give a "strong signal" that they intend to keep markets open despite the financial turmoil in Asia.
"Keeping trade open is the main road to renewed growth," the WTO chief insisted. Ruggiero also called for complete free trade in goods exported by the world's poorest nations.
The WTO director general, backed by EU trade commissioner Sir Leon Brittan and to a lesser extent United States trade representative Charlene Barshefsky, is using the WTO encounter to press for further trade liberalisation.
All three argue that in addition to ensuring the 'full and faithful implementation' of agreements reached under the Uruguay Round of trade liberalisation talks under the GATT in 1994, WTO members must also continue to tear down barriers trammelling free trade.
Trade officials say a final statement to be issued by Ruggiero on May 20 will underline the need for 'further liberalisation which is sufficiently broad-based to respond to the range of interests and concerns of all members'.
Not everyone wants to go that far. The Geneva meeting has also turned into a forum for those who believe that free trade is doing more harmthan good to people in developing nations.
"There's nothing to celebrate," stresses Myriam Vander Stichele of the Amsterdam based Transnational Institute. "All over the world, people experience that they cannot benefit from a trading system that is dominated by multinational companies."
Speaking at a meeting of the World Health Organisation in Geneva earlier in the week, Cuban president Fidel Castro also lambasted the WTO for following the "blind and uncontrolled laws of the market".
Moreover, for over two days, the streets of Geneva have been crammed with over 5,000 anti-free trade protestors who share Castro's disdain for trade liberalisation -- but have been expressing it in a more direct manner.
"Most developing countries feel that their plate is full already," insists Martin Khor head of the Penang-based Third World Network. "But, despite this, they are being pressed to sign up for a new agreement which will be even more significant than the Uruguay Round."
Khor said that the next global round -- which the EU hopes will be launched on January 1, 2000, and called, aptly, the 'millennium round' - will cover a host of new and old topics which continue to preoccupy WTO members.
The EU and the U.S. will be pressing developing countries to accept a discussion on liberalising cross-border investment flows, after having failed to get a quick decision on the subject at the Organisation of Economic Cooperation and Development in Par is, NGO trade experts predict.
The round will also focus on competition policy, government procurement, labour standards and the environment, Khor says. But, such negotiations will not be in developing countries' interest, he warns. "Our analysis is that even implementing existing agreements will create tremendous problems and lead to future social crisis in the developing world," Khor says.
The only reason, the system hasn't broken down yet, he says, is because developing nations have been given so-called 'grace periods' of up to four years to translate their Uruguay Round commitments into action. "But, there will be pain and screams of agony in a few years," Khor warns.
The response from governments in developing countries has also been cautious. India's commerce minister Ramakrishna Hegde told the meeting that the WTO and trade must be seen as an "instrument for development". The pace of change and liberalisation, he insisted, must be "carefully calibrated to take account of the differences between nations. Hegde also lashed out at the EU and the U.S. for using protectionist actions to restricts goods and services produced i n developing countries.
The Philippines' Secretary of Trade and Industry Cesar Bautista also criticised Western countries for delaying the effective liberalisation of world textiles trade.
"By pushing the bulk of restrictions for elimination to the end of the ten-year transition period -- the longest in the WTO -- the willingness of importing countries to undergo industrial adjustments through increased competition becomes questionable," he said.
Jamaica's deputy prime minister Seymour Mullings insisted that the WTO must not overlook the problems facing smaller nations as they struggle to attract investments and expand exports.
Despite the appeals for caution, trade officials say it will be difficult to stop the drive for further trade negotiations.
Under commitments made in the Uruguay Round, WTO members must start negotiations by 2000 at the latest on further liberalisation in the fields of agriculture, services and intellectual property rights.
The EU insists that these negotiations will be more rewarding for everyone if countries can barter concessions made in one sector in favour of advantages gained in another.
Trade officials say that U.S. president Bill Clinton will tell the WTO later on Monday that he wants to host next year's ministerial meeting, thereby effectively launching the new global trade talks.
The invitation is likely to be welcomed by WTO members who remain wary of Washington's commitment to the multilateral trading system.
But, for many in the south, it means months of preparations and hard work. "The WTO is not a win-win situation for developing countries," warns Martin Khor. "Some are going to lose and some are already losing."