DOCUMENT No.11 

Statement By Ambassador Munir Akram On Agenda Item 91(A): International Trade And Development In The Second Committee Of The General Assembly (November 03, 2003)

Mr. Chairman: The Pakistan delegation would like to convey our sincere appreciation to the Secretary General for the excellent report on international trade and development. We also wish to thank the Secretary General of the UN Conference on Trade and Development Mr. Rubens Ricupero for his contribution to the deliberation through the reports of the Trade and Development Board.

2.     We associate with the statement made by Morocco on behalf of the G-77 and China.

Mr. Chairman,

3.     This debate is taking place in the shadow of the failure at Cancun to reach a consensus on the continuation and conclusion of the Doha Round of Trade Negotiations.

4.     Many theories have been advanced to explain the Cancun failure. There are conspiracy theories, mismanagement theories and systemic theories. There are elements of truth in each of these theories. Beyond the specifics, the fact is that there is growing divergence between the WTO ‘culture’ – belief in the magic of the market place and in reciprocal liberalization – and the reality of unequal globalization – with the growing pauperization and marginalization of poorer developing countries, which cannot compete in the unequal game of international trade. The first sign of the erosion of the Washington Consensus was witnessed in the “battle of Seattle”. Since then the opposition of civil and some ‘uncivil’ society to the WTO and to unrestrained globalization has been manifested at every major economic Conference. So far, no new international consensus has emerged on international trade, finance and development.

5.     The Doha Ministerial adopted an unbalanced agenda for negotiations, once again focused on liberalization in areas of primary interest to the developed countries. Nevertheless, with an eye on a skeptical world public, the launch of a “Doha Development Round” was proclaimed – although the Doha Ministerial Declaration never mentions these words.

6.     The subsequent negotiations in Geneva confirmed that the reference to a Development Round was mostly lip service. The developing countries’ priorities were virtually swept aside. For instance, the deadlines for resolution of implementation issues and Special and Differential treatment were missed repeatedly.  Both issues have been excluded from the Doha Round’s ‘Single Undertaking’. Proposals on agriculture were modest; they ignored the ‘development box’ measures proposed by poorer developing countries. A balanced Chairman’s proposal on tariffs was sought to be diluted. The demand for negotiating new (Singapore) issues remained insistent.

7.     The draft Ministerial Declaration circulated in Geneva before Cancun confirmed the neglect of the objectives and views of the developing countries. Their unhappiness was no secret. It was in reaction to the regression by the ‘majors’ on agriculture that the Group of 21 was constituted.

8.     At Cancun, six coordinators – appointed, as usual, without adequate consultations – held meetings to evolve agreement in various areas. The focus remained on agriculture, where, due to the efforts of the G-21 led by Brazil, progress was made towards a compromise outcome. However, the revised Ministerial Declaration circulated on 13 September evoked a highly negative response from the vast majority of developing countries. They felt the text was worse than expected. Apart from reflecting the progress in agriculture, the text remained static in all other areas – despite the strong views expressed by developing countries on the Singapore issues, S&D, implementation and other issues. On the African proposal on cotton, the new text was a major reversal altogether omitting the essential aim of removing or reducing cotton subsidies.

9.     Scores of developing countries took the floor to voice their unhappiness with the text generally and on specific points of special concern to them. In the Green Room meeting next morning, the Singapore issues – rather than the concerns of the developing countries – were taken up first. Although, the EU offered, at the last moment, to take two of the Singapore issues “off the table”, the majority of the developing countries, unsurprisingly, could not buy into this unless they were assured of a response to their specific problems. They rejected negotiations on all four Singapore issues. The meeting closed without a substantive outcome.

10.   Not surprisingly, again, the blame for the Cancun collapse is being put on the developing countries – the G-21 and the G-90. Developing countries have also been warned that they will be the biggest losers if the Doha Round is not revived. The positions of the ‘major trading partners’ have hardened. The EU offer to drop 2 of the Singapore issues may be “off the table”. The US has said it will focus on FTAs. In Geneva, negotiations have been frozen. The APEC Summit has called for resumption on the basis of the 13 September “Derbez” text. Will this succeed?  Should we keep doing the same thing over and over and expect different results?

11.   It is time for an honest appraisal and adjustment of the Agenda and approach of the Doha negotiations. The most important requirement is to assure the developing countries that the Doha Round will be genuinely a “Development Round.”

12.   Four steps may be helpful in building confidence among the developing countries and enabling a positive re-launch of the Doha Round.

13.   First, the specific identification of the objectives, which will serve to make Doha a ‘Development Round’. In this context, the analysis prepared by UNCTAD of the “benefits” for developing countries of various trade objectives under negotiation in the Doha Round can serve as a useful guide in setting the specific objectives of the Doha Development Round. Of course, some development objectives are readily identifiable:

(i)    genuine resolution of the outstanding implementation issues;

(ii)   a commitment to eliminate tariff peaks and tariff escalation against developing country exports;

(iii)  operationalization of S&D provisions in existing WTO agreements and the full reflection of S&D in new agreements including non-reciprocity for low-income countries in new liberalization commitments;

(iv)  priority for the Movement of Natural Persons, (Mode 4) in services liberalization;

(v)   a reflection of the development dimension in the TRIPS and TRIMS agreements;

(vi)  a development-oriented discipline on anti-dumping actions;

(vii) promotion of specific development commitments in the areas of trade and debt and finance and trade and transfer of technology.

14.   Second, the consideration of a “down payment” for the developing countries to build confidence in the Doha Round negotiations. This could include: 

-     One, a moratorium on anti-dumping and other safeguard actions against the low-income developing countries particularly against their textile exports after complete phase-out of quotas in 2005;

-     Two, a positive response to the cotton initiative of African and other countries;

-     Three, a moratorium for 5-10 years on dispute settlement actions against low-income developing countries under the TRIPS and TRIMS agreements;

15.   Third, a visible commitment to capacity building in the developing countries to enhance their ability to expand exports and trade as a means of promoting development. Such a commitment could be manifested by the establishment of a capacity-building fund of at least $100 million to be executed jointly by the WTO, UNCTAD, UNDP and the World Bank.

16.   Fourth, an agreement to evolve a more transparent and democratic decision-making process in the WTO. For example, Chairpersons of WTO bodies should be selected more openly in full consultation with the developing countries. Draft decisions should emanate from WTO members, not Chairpersons, and should be openly negotiated without recourse to ‘green room’ procedures. The WTO Secretariat should effectively promote the development-oriented objectives of trade negotiations. It should seek inputs for its analysis and recommendations from UNCTAD and other organizations. Also, the composition of the WTO Secretariat, where developing countries are very inadequately represented, must be changed. Without this, the WTO ‘culture’ is unlikely to improve.

Mr. Chairman,

17.   We hope that consideration will be given in the on-going bilateral consultations, and especially at the 12 December WTO Governing Council meeting, to endorsing such steps to build the confidence of the developing countries and civil society in the Doha Round.

18.   However, there are several other issues outside the Doha Agenda, which need to be urgently addressed if multilateral trade is to be transformed into a potent instrument for equitable global development. These include:

One, the continuing volatility and secular decline of commodity prices. The old UNCTAD idea of commodity funds and buffer stocks needs to be re-visited.

Two, poverty alleviation through trade. Clearly, directed measures are required to utilize trade to achieve the Millennium Development Goals. Work on this should be conducted jointly by the Bretton Woods institutions, UNCTAD ad UNDP.

Three, the review and adjustment of current policies on debt and finance from the perspective of their impact on trade expansion and development in the developing countries. Again, the Bretton Woods institutions and UNCTAD could greatly contribute to analysis and policy recommendations in this area.

Four, a review of restraints of transfer of technology, which impede developing countries’ capacity in international trade and their development goals. UNCTAD has already done considerable work in this area, which can be built upon.

 Mr. Chairman,

19.   The fulfillment of the expectations of the developing countries for a fair international trading system is long overdue. When the Bretton Woods institutions were created, the proposal of Lord Keynes for a special mechanism to regulate commodity prices was ignored; it has cost the developing countries dearly. The “International Trade Organization”, also agree at Bretton Woods, was not created. Textiles and Agriculture – the two sectors of primary interest to developing countries – were excluded for 40 years from GATT disciplines. And trade liberalization has taken place – especially in the Uruguay Round – in areas where the rich are strong but not in areas where the poor are strong. The fight for fair – and open – trade is going to be long and arduous. It is a battle worth fighting and winning, because it holds the key to universal economic and social development and global prosperity.

I thank you.

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