WTO chief Pascal Lamy upbeat about global trade talks
The Hindu, India
WTO chief Pascal Lamy upbeat about global trade talks
Sushma Ramchandran
Expects better offers from EU and Group of 20 too
24 June 2006
New Delhi: The World Trade Organisation chief Pascal Lamy is upbeat about global trade talks, with the U.S. having indicated that it will go further to cut trade distorting farm subsidies. He is also expecting better offers from all the other major players in the round, including the European Union and the Group of 20 that includes India, Brazil and China, during the mini-ministerial conference next week in Geneva.
Speaking to a small group of international journalists in an hour-long conference call from Geneva, Mr. Lamy commented on India’s focus on livelihood concerns in the agriculture sector. He said the WTO secretariat would examine the bilateral free trade agreements (FTA) being signed by India to determine whether these sensitivities were also being kept in mind while entering into these tie-ups.
He reiterated his view that bilateral FTAs would always work to the disadvantage of smaller developing economies, which would be in the hands of "elephants" such as the E.U., the U.S., China and India.
Mr. Lamy spoke on these issues just before the draft agriculture text was released with numerous brackets indicating areas where agreement has yet to be reached.
Though the release of the draft has been considered disappointing because of the huge number of brackets, the WTO chief remains positive as he feels the three sides of the "triangle" now have a better possibility of movement.
He was referring to the three main issues of market access in agriculture and non-agriculture areas as well as trade distorting farm subsidies. "The close of the agriculture deal is much nearer than ever before."
The WTO chief, felt U.S. President George Bush was himself "engaged in trade". Conceding that Mr. Bush was not very much aware of the subtleties of trade negotiations, such as the Swiss formula on tariffs, Mr. Lamy said he did believe that trade opening is good and that developing economies have to trade their way out of poverty.
He pointed to Mr. Bush’s comments after the E.U.-U.S. summit in Vienna, which gave signals of flexibility in his approach to the key issue of agricultural subsidies. At the same time, he pointed to the political reality that such issues had to be explained to the domestic constituencies.
On the U.S. proposals, he said the G-20, as well as the E.U., have been urging the U.S. to make real cuts in the trade distorting subsidies which is a point that has evidently been recognised.
Explaining the U.S. scenario, he said out of the overall domestic support of $ 90 billion, the trade distorting component was estimated at $ 19.5 billion in 2005.
But with the various flexibilities available, he said, the U.S. had offered a 60 per cent cut and yet ended up with a higher figure of $ 22.5 billion of domestic support. The other major players, such as the G-20, which have been asked to make real cuts in industrial tariffs, were saying, " be serious". This was a point the U.S. had recognised.
In this context, he stressed that what was on the table from all players was not sufficient to meet the requirements of the Doha round. These offers need to be "topped up and not down compared to what is on the table."
As far as the Indian stand was concerned, he felt Commerce and Industry Minister Kamal Nath had made it abundantly clear that livelihood issues related to agriculture and the consequent sensitivities were critical for the country.
He noted that India had signed several bilateral trade agreements.
These would be studied by the WTO secretariat to find out whether concessions given in these are in line with the sensitivities being highlighted in the multilateral negotiations.
Mr. Lamy did not agree with those who suggested the Doha round be put in the freezer for two years and then revive it when the U.S. administration changes.
