4:48 AM Mar 21, 1994
HIERARCHY WITHIN THE 'MARKET TRINITY'?Geneva 19 Mar (Chakravarthi Raghavan) -- While the GATT secretariat is pushing to equate the proposed World Trade Organization with the Bretton Woods institutions, and for the three to function as the Trinty of global economic policy-making, the International Monetary Fund is unhappy and wants to ensure that its supremacy within the trinity will be legally recognized via the WTO. The IMF is reported to be unhappy with the WTO treaty which, unlike the General Agreement of 1947, will be a definitive treaty and subject to normal rules of international treaty interpretations. The WTO text, as adopted, provides for the WTO to 'cooperate as appropriate' with the IMF and the World Bank in order to achieve greater coherence in global economic policy-making. Another provision makes clear that in any conflict between the WTO agreement and any other multilateral trade agreement, the WTO provisions will prevail. The IMF apparently wants the WTO text, in the stage of legal rectification, to make clear that in the event of a conflict between the IMF's Articles and the obligations under WTO of any country, the IMF articles would prevail. However, since the IMF and the World Bank have no control over the major industrialized countries (and in fact carries out the decisions taken outside of the G-3 or the G-7), but only over the developing world and the former socialist bloc or the 'economies in transition', the assertion of the IMF supremacy would really mean tightening the IMF control over these countries, with the WTO playing a subordinary role of ensuring that the trade policy instruments carry out IMF policies. It is not very clear how the IMF desires can be met or should be met in the present stage. The changes it seeks are by no means 'technical corrections', but the Uruguay Round processes have been used flexibly to meet the demands and desires of the major power structures in the world economy.