World Bank President Makes Statement Regarding Doha WTO Negotiations

by Ulrika Lomas, for LawAndTax-News.com, Brussels

21 August 2008

The World Bank's Group President, Robert B. Zoellick, spoke out on Tuesday to issue a statement regarding the current state of the Doha WTO negotiations.

Mr Zoellick announced:

"As the dust settles from the breakdown of the WTO negotiations in Geneva, some parties are recognizing that there was a good package of results left on the table. It would be a mistake for the world economy and harmful for developing countries not to retrieve it.

"President Lula of Brazil has called on the parties not to let the WTO negotiations fail because of differences over a special safeguard for agriculture. He is right," Zoellick added.

Last month, the World Trade Organisation's (WTO's) Director-General, Pascal Lamy, announced that ministers attending trade talks in Geneva had failed in their efforts to agree on blueprint agreements in agriculture and industrial products.

He told a press conference after speaking to members that out of a to-do list of 20 topics, 18 had seen positions converge but the gaps could not narrow on the 19th — the special safeguard mechanism for developing countries.

According to Mr Lamy, some countries wanted a high “trigger” (a large import surge needed to trigger the tariff increase) in order to avoid the safeguard being triggered by normal trade growth, while others wanted a lower trigger so that the safeguard could be easier to use and more useful.

Zoellick continued:

"Working with WTO Director General Pascal Lamy, the United States, India, and China should come up with a compromise. Brazil, a developing country that is both a major agricultural exporter and home to many poor farmers, can help. Indonesia and Australia may be in a position to contribute to a solution too.

Zoellick suggested three ways in which this problem could be solved:

"A big problem with safeguards is that once a country triggers them, it can take two years or more to challenge the grounds for imposing them. In the meantime, the new barriers block trade. So a compromise could create a speedy due process for challenges, without appeal.

"All parties seem to agree that safeguards should not be imposed to block normal trade flows. But they disagree on how much of a change warrants the temporary protection of a safeguard. Since the purpose of a safeguard is to help cushion the effect of a significant increase in imports on local producers, an acceptable justification for the safeguard could require examination of factors in addition to increased trade flows.

"Under current WTO practice, the economy imposing a safeguard decides how much protection is appropriate. But this protection could be disciplined and limited."

The World Bank President went on to observe that: "It may be understandable that tired negotiators couldn’t assemble these and perhaps other variables in a way to solve the problem. But they should not quit trying. With this many elements to deploy, people who want a deal should be able to achieve one."

He concluded that: "There is too much at stake to let this problem derail a global trade package that could expand economic growth and opportunity by cutting cut subsidies drastically, lowering tariffs significantly, and opening up services markets. There is a good Doha deal still to be seized.”

According to Lamy, the failure of the talks does not mean the end of the Doha Round.

Recommended