On 19th September, Zeinab Badawi, Presenter of World News Today at the BBC, had a one-to-one 90 minute interview with WTO Director-General Pascal Lamy at last week’s WTO Public Forum. Ms. Badawi took the opportunity to ask the Director-General about what challenges the Doha round would need to overcome in order to dispel accusations that negotiations have reached a stalemate.
Mr Lamy admitted that the WTO members recognised that talks had reached a point from which a clear outcome is difficult to predict. One possible explanation for the situation he gave was that too many topics are trying to be discussed and resolved at once. It is his view that industrial tariff reduction is the largest obstacle and where the deadlock lies.
Mr Lamy identified the rapid rise of the ‘emerging’ economies, and in particular the BRIC countries, that have given the round a new context today compared to when it started. These countries with their growing economic weight are now in a position in which they can demand better conditions for their citizens. Trade deals can no longer simply favour rich countries. Trade Out of Poverty would argue that if anything the deals should favour the least developed countries, and the BRIC nations should play their part in achieving this.
Mr Lamy pointed out that one of the threats from the current global economic crisis will be the temptation from governments to implement protectionist policies in response to high unemployment rates. A reaction that Lamy believes would not yield the desired results.
Lamy reaffirmed his belief in “open trade” rather than free trade. TOP also believes in “open” trade, even though the normal procedure under WTO rules is for tariff reductions to be reciprocal. However, it is important that rich countries open up their market to the poorest unconditionally – without requiring them to open up their markets to exports from the industrialised world.
The poorest countries represent a fifth of the world’s population but they account for less than one fiftieth of world trade. The export industries of the poorest countries are small in scale, unsophisticated and often specialised in products which cannot be produced easily or competitively in the developed world. By no stretch of the imagination are they a ‘threat’ to the industries of the developed world.
Since the poorest countries take less than 2% of the rest of the world’s exports it is frankly of minimal significance to rich countries whether those markets are opened wider or not. By contrast the rich countries represent the market for over 90 % of the exports of the poorest countries so the barriers we impose are absolutely crucial to them.
The Director-General pointed to the examples of India and China, among others, where trade has led to growth which will help to alleviate poverty and speed up development. Trade has been and will continue to be the engine that breaks down the barriers restricting poor nations. Let’s just hope Mr Lamy will provide the platform to allow this to happen.
In an interview on 19th September, WTO Director-General Pascal Lamy attempted to shed some light on the future of the Doha Development Round, and reaffirms his belief in “open” rather than “free” trade.