(U.S. trade representative op-ed article in Financial Times)
(1110)
(This column by Robert Zoellick, who is the
U.S. trade representative, was published in the Financial
Times September 22 and is in the public domain. No republication
restrictions.)
The final minutes of the World Trade Organisation
[WTO] session in Cancun were symptomatic of the whole meeting:
we stalled after representatives of the least developed,
African, and Caribbean countries reported that their colleagues
had rejected any negotiation to update the 1947 rules on
customs procedures.
The breakdown occurred over measures that
would have simply facilitated trade and helped land-locked
countries by ensuring prompt release of goods, publication
of procedures, and timely and fair rulings on customs questions.
These commonsense steps are in the interest of all; their
rejection was a political statement. Sadly, this decision
was emblematic of a broader culture of protest that defined
victory in terms of political acts rather than economic
results.
As Luis Ernesto Derbez, Mexico's foreign
minister and chairman of the meeting, closed the session,
representatives of influential developing countries finally
rushed forward to say they wanted to keep going. They correctly
recognised that the draft text offered an excellent opportunity
to press the European Union [EU] to eliminate agricultural
export subsidies; to achieve big cuts in farm subsidies
in the US, EU and other countries; to impose a ceiling on
unbelievably high Japanese tariffs; and to open agricultural
markets for developed and developing countries alike. Yet
they were too late.
The previous evening, country after country
had scorned the draft text, the negotiating process and
other countries. The United Nations General Assembly has
its role, but it does not offer an effective model for trade
negotiations. A few ministers pointed out that increasingly
radical rhetoric would make it harder for all -- especially
developing country groups with many smaller members -- to
consider realistic compromises. Countries that feel victimised
are unlikely to agree to anything.
Cancun could have followed a different course.
Only weeks before, we had worked together to resolve the
difficult issue of ensuring that poor developing countries
could gain access to low-cost, life-saving medicines while
protecting intellectual property. But at Cancun the naysayers'
tactics thwarted those who would have cut agricultural subsidies
and tariffs, triggering reform of farm policy in the US,
EU, Japan, Canada and elsewhere. They passed up an opportunity
to open developing country markets gradually to other developing
countries. They stymied global sourcing and production networks,
which integrate developed and developing country businesses
to mutual benefit. And they walked away from rules on openness
and transparency that fight favouritism and corruption.
Key mid-level developing countries employed
the rhetoric of resistance as a tactic both to put pressure
on developed countries and to divert attention from their
own trade barriers. India's average bound agricultural tariff
is 112 per cent, Egypt's 62 per cent and Brazil's 37 per
cent -- compared with a US average of 12 per cent. Their
average bound tariffs on manufactured goods are at least
10 times larger than the US average of 3 per cent. We should
be able to reduce these barriers while protecting the poorest
nations and providing flexibilities for special sensitivities
in the bigger countries.
After the US pressed the EU to develop an
agricultural framework that could achieve farm subsidy and
tariff cuts far beyond those achieved in the last global
trade negotiation, we asked Brazil and other agricultural
powers to work with us. Brazil declined, turning instead
to India, which has never supported opening markets, so
as to emphasise north-south division not global agricultural
reform.
Smaller developing countries resisted the
reduction of US and EU tariffs because they calculated that
they would lose the advantages offered by special US and
EU programmes that eliminate tariffs only for their exports.
Unfortunately, these well-meaning trade preference programmes
have undermined the push for two-way openings, perpetuating
dependency.
Four African countries insisted on "compensation"
of between $250 million and $1 billion ... annually, and
unilateral elimination of cotton subsidies. Over the course
of 50 years, global trade negotiations have progressed because
countries could trade off cuts across products and even
sectors to achieve a balanced result. The US has no export
subsidies on cotton and proposed the elimination of all
export subsidies. We committed to cut domestic cotton subsidies
as part of an overall package that would also have reduced
European and Chinese cotton subsidies, along with all agricultural
subsidies. Instead of making cotton a symbol, we wanted
to make development a reality through concrete results for
cotton farmers, exporters and manufacturers of cotton products,
along with all farmers.
The tactics of confrontation included an
assault on one of the few devices that the WTO can use to
prod its 148 members towards consensus: presenting a chairperson's
text for discussion and negotiation. Brazil, India and others
refused even to work off an agricultural text drafted by
the Uruguayan WTO chairman and forwarded by the WTO's Thai
director-general. Even after Singapore's tireless minister
had worked non-stop with all parties to prepare a new agricultural
draft reflecting a balanced compromise, Brazil and its colleagues
presented a massive list of required changes. If they were
serious about negotiating a compromise for 148 countries,
they overplayed their hand by failing to signal that intention.
They returned home without any cuts in subsidies and tariffs.
As Chairman Derbez closed the Cancun meeting,
he asked countries to reassess prospects by December 15.
We know well what developing countries are demanding, but
have not heard whether more competitive developing economies
will cut their high barriers. We do not know whether other
developing countries that blocked action in Cancun will
now accept packages that ask little or nothing of them.
The US stands ready to work with the draft text across the
full agenda. As the Doha negotiations drift into next year,
however, we recognise that a new European Commission may
reflect different perspectives.
Many countries -- developing and developed
-- were dismayed by the transformation of the WTO into a
forum for the politics of protest. Some withstood pressure
to join the strife from larger developing neighbours. Of
course, negotiating positions differed. But the key division
at Cancun was between the can-do and the won't-do. For over
two years, the US has pushed to open markets globally, in
our hemisphere, and with sub-regions or individual countries.
As WTO members ponder the future, the US will not wait:
we will move towards free trade with can-do countries.
(Distributed by the Bureau
of International Information Programs, U.S. Department of
State. Web site: http://usinfo.state.gov)
