New Vision (Kampala)

Uganda: Aid to Poor Nations to Continue

Berlin — THE European Union will continue to support developing countries as part of the solution to end the global financial crisis, its leaders have said.

This pledge came shortly after African finance officials called on the West to help them cushion their economies from the global economic recession.

The European heads of state and government meeting in Brussels, Belgium to map strategy for a key G20 summit in a fortnight, said they would honour commitments to increase development assistance despite growing budget deficits.

"We reaffirm our commitment to deliver on the Millennium Development Goals, meet our aid-for-trade pledges and give duty-free and quota free-access to the least developed countries," they said in a statement last week.

The regional body also called on least developed countries to remove trade barriers and open their markets to pave way for economic recovery.

The call comes amidst heightened fears over moves towards protectionism due to the global economic meltdown.

Already developed countries, in a bid to stabilise their economies from the impact of the recession, have unveiled stimulus packages with trade barrier clauses.

These include the "Buy American" provisions in the US stimulus package, export subsidies for dairy producers by the European Union and a French package for ailing carmakers.

Pasal Lamy, the World Trade Organisiation director general, earlier this month observed that "several new barriers to trade like increases in tariffs or in trade-distorting subsidies, were legal.

"Because countries may not have been using, in the past, their tariff and subsidy entitlements to their fullest capacity," he said, adding that if used such entitlements could greatly affect world economy and trade.

"And it is much of these unused entitlements that the Doha Round would have helped eliminate," Lamy said.

EU leaders in 'Brussels last week pledged to reach a swift agreement on eight-year old trade talk that started in 2001 in the Qatari capital of Doha in 2001, saying they would "keep markets open and avoid all forms of protectionist measures." Catherine Ashton, the EU trade commissioner said separately that no economy had ever grown sustainably without some kind of economic engagement.

"For me fair trade means trade that helps build European prosperity without making other counties worse off and which actively helps lift people out of poverty wherever it can.

Ashton said trade policy would be "more important than ever" to developing world, adding, "we need to share prosperity and growth more widely and create a fairer trading environment where emerging economies can grow, supported by our development programmes and aided by our trade."

Last year negotiations for a new global trade agreement-the so called Doha Development Talks - failed when poor nations wanted the US and EU to cut farm support before opening their markets. In response, the big economies demanded developing countries to remove barriers to farm imports referred to as special safeguard measures on agriculture.


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