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Africa: Continent Needs World Trade Deal, Says WTO Chief
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INTERVIEW
7 March 2008
Posted to the web 7 March 2008
The first international trade negotiations which proclaim as one of their objectives reducing discrimination against developing countries in the global trading system are entering a critical few months.
The talks, which began in Doha, Qatar, in 2001, have long been plagued by differences over issues such as the measures which countries take to protect their own farmers, or industries, against cheaper imports from elsewhere. Developing countries want rich countries to cut agricultural subsidies, or tariffs on agricultural imports, so they can export their produce there. Industrialized countries want newly-emerging countries to cut import tariffs so they can export manufactured goods to those countries.
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AllAfrica Pascal Lamy |
Now, says Pascal Lamy – who, as director-general of the World Trade Organization, referees the talks – there is a better chance than ever before that a deal can be done which will help African and other developing countries break through into new markets in industrialized countries. Lamy was in Lesotho last week for a conference of the bloc known as the least-developed countries (LDCs). On his way back home through South Africa, he spoke to AllAfrica. Excerpts:
Last time we spoke, you compared the process of concluding the Doha Round of talks to an aircraft preparing to land. Some people now think the aircraft is going to crash; it certainly must be running out of fuel. How would you apply that analogy now?
I think we now know in agriculture which portion of the tarmac we will land on. It's still a bit less clear in industrial tariffs, which is why the coming weeks must be focused on that, but we definitely have the landing zone in sight.
What about talks on services?
Services is a more complex negotiation because it's a request-and-offer negotiation, so it takes more time. And the services negotiation is very much linked to the final conclusion of the round. There will be a result on services because services are mandated – just as trade and environment, or trade facilitation or fisheries subsidies or anti-dumping rules are.
We have kept to this principle that we have a single undertaking. If something is agreed on farm subsidies, on farm tariffs and on industrial tariffs, it will only be accepted as part of a global deal with 17 other topics. The services negotiation is one of those 20 topics and if members don't agree with what's on the negotiating table there is no deal.
What are the sticking points for Africa in each of those areas – agriculture, industry and services?
Well, it's as difficult to speak about Africa as a whole as it is to talk about Asia or Latin America as a whole. South Africa is not Kenya, Kenya is not Senegal. And in WTO we don't have one-size-fits-all. We have tailor-made solutions depending on the level of development.
On agriculture, African countries are mostly on the offensive. They want the United States, the European Union and Japan to reduce their subsidies [paid to farmers to produce certain types of crop]. They want the U.S. and EU to reduce their tariffs [on agricultural imports] and they will get that. The question now is exactly how much they will get.
On industrial tariffs, African countries are more on the defensive. But only very few of them – South Africa, Egypt, Tunisia, Morocco – will have to take tariffs cuts according to a general formula. All the other African countries, because they are LDCs or have a low number of fixed tariff rates will be exempted from cuts in industrial tariffs.
Overall… the conclusion of the LDCs' conference which took place in Lesotho – and the majority of African countries are LDCs – is that they are pushing for a deal as they are the ones in this negotiation who will gain the most from a success while paying a very modest price.
LDCs would benefit from duty-free, quota free treatment on 97 percent of their exports. Rich-country cotton export subsidies would be eliminated straight away and other forms of trade-distorting support would be reduced by an even higher percentage that the cuts on support for other crops. Cotton exports from LDCs would receive duty-free, quota free treatment.
If the round fails, it will be bad news for LDCs. This is why a Doha agreement is so important.
On industrial tariffs, they're on the defensive because they're being challenged to reduce the tariffs which they've used to protect their industries?
Well, yes, for some of them the price of a deal is that they will have to reduce some of their applied tariffs. Now the official currency in WTO is bound tariff which is the maximum tariff a country can apply. It's not the applied tariff and usually applied tariffs are lower. So it's a very complex issue because the reduction that you take is on your bound tariff but it only impacts your business or constituency if it bites into applied tariff.
It seems as if we ride this train every single year. Someone somewhere decides that it is time to talk trade again. But do we ever get anywhere? Can we ever say we will achieve “free” trade with all the global protection? And no hope for “fair” trade either. It seems as if the dance is on again in 2008. More on this in my blog at http://angryafrican.wordpress.com/2008/01/27/here-we-go-again-lies-damn-lies-and-world-trade-negotiations/
" HAVE YOU MIND JUDGEMENT TO SEE IF WORLD GLOBALISATION IS REALLY RIGHT ------- WTO BLUFFS " Up isn't down, a horse isn't a cow, slavery is not liberty and free trade will never get Africans paid. It is in short a hustle, a scam, a scheme designed to fill the pockets of an elite, residing mainly in the western world, at the expense of everyone else, especially us Africans. So how do they run this game? Simply put, through the spread of the false religion of global capitalism, known... [Read Full Text]
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