GENEVASpeak up, developing countries. Stop dwelling on past inequities and
recognize where your future interest lies. The World Trade Organization badly
needs political backing if its November ministerial meeting in Doha, Qatar, is
not to end in a Seattle-style flop, without the riots.
That means getting an agenda for a new
round of negotiations on liberalization agreed upon by the end of July. That in
turn means capitals giving their ambassadors in Geneva authority to stop
wrangling over obscure points and cut deals. Or perhaps Director-General Mike
Moore and his successor Supachai Panitchpakdi should not wait for a consensus
but hammer out what they see as a workable agenda and persuade states to sign
For sure, nothing can happen without the
European Union and the United States. Both are in theory in favor of a new round
but have concerns, about labor rights and competition policy in particular, that
go beyond what is acceptable to others in a body where decisions are reached by
consensus through horse-trading.
A consensus now among major developing
countries about the need to press ahead would improve the chances of the round
taking place and put them in a stronger position to influence the outcome.
Developed countries are dragging their
feet partly because they see no domestic political advantage. The
anti-globalization protests in the West may not have mass support but they have
made governments defensive. The developing world needs to dissociate itself as
far as possible from anti-WTO activists in rich countries, the protectionists
who masquerade as supporters of the poor under the guise of defending labor
rights and the environment.
Developing countries' wariness of the WTO
is understandable. Many are still bogged down trying to figure out, let alone
carry out, some of the Uruguay Round commitments. They continue to resent the
shocking distortions of farm trade, to be harassed by developed countries'
anti-dumping measures, to resent the persistence of protectionism on textiles,
in which they are strong, while being forced to open up service industries in
which they are weak. They rightly blame over-rapid liberalization for financial
sector instability. They resent the lack of input that they have had into past
But they still have more to gain than to
lose. They, not the demographically challenged old rich, are the future of world
The WTO is not an organization that can
stand still. Either it progresses or it retreats. Moving now is important
because conditions will probably become less favorable.
If the United States goes into recession,
trade tensions will increase. Next year elections are due in many rich countries
that will delay decision-making. China should finally be a WTO member, and its
huge presence will make consensus more difficult.
Now is a good time because agricultural
disasters have made it easier for Europe to accept the need for radical policy
reform. Meanwhile, European business, as represented by the European Roundtable
of Industrialists, recently told a meeting of the Evian Group, a high-powered
trade policy forum, that it favored a new round even if the agenda is not as
comprehensive as Brussels has demanded.
Some of the more influential developing
states ought to have particular reason to want a new round without waiting for
issues left from Uruguay to be resolved. One reason is the forward march of
regional pacts, which may have a trade liberalizing effect but will be dangerous
if the WTO agenda cannot keep up.
That would be particularly damaging to
some influential players. India belongs to no significant regional grouping.
Brazil, given the importance of its trade with Europe and South America compared
with that with North America, should be more interested in global arrangements.
East Asian countries may hanker after an
Asian regional bloc, but, given Japan's negative stance and China's dependence
on the U.S. market, it is unlikely to emerge. Asians anyway need global markets
where their competitiveness can shine.
It should not be beyond the wit of WTO
delegates to construct a realistic agenda. Labor and environment could get a
mention - but subservient to the respective UN bodies which deal with them.
Complex new issues like competition policy could be left to major developed
countries to discuss among themselves.
Freer trade in goods is irrelevant to
many developing countries which lack the means to participate. But for the
majority who do, China most conspicuously, it is time to take a more forceful
and flexible approach to see that the West does not let the WTO process stall.