Trade Works, Says WTO Head, But Only If Right Policies, Transparent Trade System In Place

The annual World Trade Organization Public Forum opened today with a plenary session on making trade work more inclusively. The Doha Round, agriculture, and environmental technologies were part of the conversation.

The 2015 WTO Public Forum is taking place from 30 September – 2 October, and its theme is “Trade Works.”

WTO Director General Roberto Azevêdo introduced the forum and the opening plenary and said it marked the 20^th anniversary of the institution and was a time for reflection on what the WTO has accomplished and what it has not.

Trade works, he said: it leverages economic growth, connect economies and lifts people out of poverty. However, he said, the 2015 theme is missing a word: “if”. Trade works if a number of conditions are met, he said, such as the right policies, capacity building, and a transparent system of trade rules agreed on by all.

Azevêdo’s remarks are now available here.

Lilianne Ploumen, minister for foreign trade and development cooperation of the Netherlands, underlined the importance of trade in meeting the newly adopted United Nations Sustainable Development Goals.

Being part of the global value chain is key for developing countries, she said, adding that many people are still excluded from the benefits of the global trading system, for multiple reasons, such as the absence of infrastructure, the lack of access to finance, and “blatant discrimination.”

Yuejiao Zhang, WTO Appellate Body member, said all should get equal opportunity and an equal footing in competition. She said it is important to maintain the cornerstone of the WTO special and differential treatment provisions for developing countries, and to enhance local capacity building as well as encouraging the transfer of technology.

Anabel González, senior director, Trade and Competitiveness Global Practice at the World Bank Group, said trade is key to eradicating poverty and trade should benefit everyone everywhere, in particular people living in rural areas, in conflict zones, and women. As a way to achieve that goal, she suggested to reduce trade costs and addressing existing barriers.

Azevêdo said smaller economies cannot be ignored simply because they are not as attractive as larger markets. Those smaller economies have to be part of the setting of the agenda, he said. They need to be sitting at the negotiating table. Some 80 percent of the companies in developing countries are small and medium enterprises, he said, underlining the challenges faced by those SMEs to penetrate the global trade flow.

Challenges for Africa, Doha Round, Agriculture

Amina Mohamed, cabinet secretary for foreign affairs and international trade of Kenya, said trade has pulled people out of poverty in Africa, and trade will pull people out of poverty much faster than anything else. However, one of the issues still to be tackled is the political will and courage of African nations to “bring down the walls” and open up Africa so that people and products can go freely across borders, she said.

The Doha Round of trade liberalisation talks started in 2001 spurred a discussion among speakers. Mohamed said the Doha Round is extremely important, while Susan Schwab, former United States Trade Representative, said the Doha Round acted as a brake on resolving some issues at the WTO, such as agriculture subsidies and market access for developing countries and least developed countries (LDCs).

Mohamed underlined the importance of the Doha Round for African countries. Agriculture has always been the “elephant in the room,” she said. Agriculture is important for Africa, she added, but the only way Africa will be able to industrialise itself is by being allowed to have the policy space to add value to what the continent produces.

Africa has been exporting raw products and importing processed products and it is important that the continent is able to add value to those raw products by processing them, Mohamed said.

Ploumen said it was “amazing” to consider how little loved was the Doha Round after being around for so long, and called for a change in the process. She said the Netherlands is in favour of doing away with agricultural subsidies.

Zhang said subsidies have existed for a long time. The system is unfair for developing countries trying to enter the global market, she said and current rules ought to be reviewed.

González remarked that some internal barriers also are an issue for trade inclusiveness, such as the high cost of transportation within countries, the lack of information for farmers or on how to manage risks.

Azevêdo remarked that this was the “soft, very polite, very diplomatic” format of what he hears every day at the WTO. Everybody agrees that agriculture is a big issue, he said, adding that subsidies are a problem as they distort trade and are a difficulty in particular for enabling small producers to compete. However, the issue is more complicated than it seems, he said.

In particular, details – such as what kind of subsidies, from where, how much, under what premises, and how fast – render discussions difficult, he said. But the issue is not going to disappear. “We will have to deal with this,” he said.

Climate Change Technology, Too Expensive for Africa, IP

On climate change technology, Mohamed said there is a need to look forward but also to consider the reality on the ground. Technologies required to move into the green world are so expensive it makes it almost impossible for countries to move forward in this field, she said.

This issue needs to be addressed, she said. It is extremely expensive to move from easier means to producing energy to a cleaner production, she said. Higher green standards in exports market effectively shut African manufacturers from those markets because they cannot meet those standards for lack of access to new technology, she said.

Asked by Intellectual Property Watch about the role of intellectual property in the lack of access to green technology, González said intellectual property has an important role to play in terms of fostering new technologies and a balance needs to be struck between protecting IP rights and access.

Besides the price of technology, increased access also relies on strengthening capacity building, and the ability to absorb technology, she said.

 

Image Credits: Catherine Saez