The G20 Summit in Washington which resulted in numerous pledges and a broad
consensus on the need for international co-operation to minimise the impact
the financial crisis, and lessen the repercussions of a looming global recession,
has placed renewed pressure on World Trade Organization (WTO) agricultural negotiators
to square their differences with alacrity, and hence save the Doha round
of free trade talks.
The communique released after the conclusion of the Washington Summit, though
primarily focussed on increased financial collaboration and the need for greater
international regulation, pledged specifically to seek a succesful conclusion
to the Doha round:
“We underscore the critical importance of rejecting protectionism and
not turning inward in times of financial uncertainty. In this regard, within
the next 12 months, we will refrain from raising new barriers to investment
or to trade in goods and services, imposing new export restrictions, or implementing
WTO inconsistent measures to stimulate exports. Further, we shall strive to
reach agreement this year on modalities that lead to a successful conclusion
to the WTO's Doha Development Agenda with an ambitious and balanced outcome.
We instruct our Trade Ministers to achieve this objective and stand ready to
assist directly, as necessary. We also agree that our countries have the largest
stake in the global trading system and therefore each must make the positive
contributions necessary to achieve such an outcome.”
In response to this clear commitment from the G20 nations, the chairperson
of the agricultural negotiations, Crawford Falconer, has pressed for negotiators
to move urgently. The ambassador told delegates on November 17 that “agriculture
negotiators will have to show changed positions within days — and by the
end of next week (November 24-28) at the latest — if they are to fulfil
the recent Washington summit’s pledge on the Doha Round”.
He called for movement particularly from officials of the 20 countries participating
in the November 14-15 Washington Summit.
Ambassador Falconer noted that if the leaders believed that agreement was possible
by the end of December, then their officials must have indicated to them that
it would be possible to change positions sufficiently to reach consensus. Therefore,
he urged that the time had come to reveal the shifts in position that countries
were willing to make.
Pascal Lamy, Director-General of the WTO, having
recently announced his intention to seek a second term, will no doubt be pleased
that the fight to save the Doha round has been included in such an integral
way in the G20 discussions. In recent speeches he has argued that trade should
be central to the current push for greater financial regulation in the wake
of the global financial crisis.
Whilst Mr Lamy welcomed the current enthusiasm for the building of a new Bretton
Woods Consensus, he was clear that discussions on such global subjects needed
to be as inclusive as possible.
In a recent speech to the Third Global Policy Network Conference in Beijing,
he pointed out that “trade is not the cause of financial turmoil but good
trade policies may be part of the solution. It allows unused resources linked
to the fall in domestic markets to be exported. Trade opening can also be useful,
by increasing the efficiency of affected economies, bringing fresh capital inflows
— in financial services for example — and by providing new export
opportunities. The resort to protectionism is made much more difficult for countries
that wish, in a non-cooperative mode, to shield themselves from the exports
of crisis-stricken countries.”
Mr Lamy argued that trade should once again be pushed up the agenda, specifically
the saving of the Doha round, and not be forgotten in the scramble to create
global financial regulation.
“So, trade is the low-hanging fruit in a complex set of issues requiring
collective action now, including finance, the environment and energy. The question
arises whether these issues should be tackled one by one or as some sort of
“grand bargain”. My sense is that, even if these issues have to
be solved one by one, there is a need for world leaders today to look at all
these issues as parts of one reality: the need to achieve a better redistribution
of powers between developed and developing nations and the assumption by all
nations of their corresponding responsibilities to tackle these global challenges.
All nations need to make their contribution to a global solution. The Doha Round
can be fixed now. Let’s fix it while devising solutions to the rest of
the challenges.”
He will no doubt be gratified to learn that world leaders were apparently listening.
Tax Transparency
The Washington Summit communique also urged that “tax authorities, drawing
upon the work of relevant bodies such as the Organization for Economic Cooperation
and Development (OECD), should continue efforts to promote tax information exchange.
Lack of transparency and a failure to exchange tax information should be vigorously
addressed.”
The process of increasing tax transparency is however already well advanced,
with a spate of recent Tax Information Exchange Agreement (TIEA) signings, against
the backdrop of a threatened OECD blacklist second coming. The OECD declared
itself satisfied with progress following a recent week that saw the signing
of 16 new bilateral TIEAs:
"The latest agreements represent a significant extension of information
exchange networks in place in these jurisdictions, showing their commitment
to implementing OECD’s standards of transparency and exchange of information
in tax matters," the organisation noted.
There have been 44 TIEA arrangements put in place since 2000 when the OECD
began its first offshore crackdown. The Isle of Man is leading, with 11 such
pacts; Jersey has signed 10, Guernsey nine, the Netherlands Antilles four and
the British Virgin Islands three. Bermuda also has three of these agreements,
having signed its first bilateral pact with the United States in 1986.
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