Johannesburg, August 02: A $250 billion financial package to revive a global trading system crippled by the credit crisis is starting to bear fruit, especially in Asia, the head of the World Trade Organisation (WTO) said on Saturday.
“Oil is (returning) to the various mechanisms of world trade,” WTO Director-General Pascal Lamy said in South Africa.
“My sense — but it’s a qualitative feeling at this stage — is that notably in regions like Asia, because countries like China stepped in very vigorously, things are picking up,” he said.
Despite this cautious optimism, Lamy said the Geneva-based body was maintaining its forecast of a 10 percent contraction in global trade this year as a result of world recession and the freeze-up in trade credit precipitated by financial crisis.
Lamy also said WTO members acknowledged South Africa’s argument for special treatment in the current Doha round of trade talks because of relatively deep cuts in industrial tariffs made under apartheid, which ended 15 years ago.
During white minority rule, South Africa was treated in trade terms as a developed country, rather than the developing status it now enjoys.
“South Africa had to take, at the time, tariff reductions commitments that were more stringent than other developing countries,” Lamy said.
“This is recognised. South Africa will, at the end of the negotiations benefit from specific flexibilities. That’s now recognised. How much of that is still to be negotiated,” he said.
The Doha round of talks to draw up a new framework for world trade was launched in Qatar in 2001 specifically to help poor countries.
However, a meeting collapsed a year ago and little progress has been made since then, with fundamental disagreements about farming subsidies and the United States and big emerging countries such as China and India pitted against other.
In the last 12 months, political leaders across the spectrum have talked at length of the need to revive the talks, leading Lamy to say the goal of wrapping up the mammoth negotiations some time next year was “do-able”.
Diplomats and trade experts in Geneva are now on the northern hemisphere summer break, but Lamy said he expected renewed energy come September, especially since an apparent rapprochement between Washington and New Delhi.
“From September on, following a number of positive political signals, notably from the US and India, my hope is that … the negotiating activity will move up,” he said, adding that the technical issues of concluding such a complex series of negotiations would remain a challenge.
He also said all WTO members, including the United States, accepted the need for major cuts in cotton subsidies. The so-called C4 West African countries of Benin, Burkina Faso, Mali and Chad argue the US subsidies depress world prices and rob their farmers of export sales.
“Everybody knows that cotton trade-distorting subsidies will have to be very substantially reduced. The US knows that. It’s just a question of when they confront their domestic constituency,” Lamy said.
U.S. trade representative Ron Kirk said on Friday Washington would only cut its annual support to U.S. cotton farmers as part of a wider deal whereby developing countries such as India and China opened up to US cotton exports.
The issue is likely to feature prominently on a trip by Kirk to Kenya, Ethiopia and Senegal this week.
Bureau Report
Johannesburg: A $250 billion financial package to revive a global trading system crippled by the credit crisis is starting to bear fruit, especially in Asia, the head of the World Trade Organisation (WTO) said on Saturday.
“Oil is (returning) to the various mechanisms of world trade,” WTO Director-General Pascal Lamy said in South Africa.
“My sense — but it’s a qualitative feeling at this stage — is that notably in regions like Asia, because countries like China stepped in very vigorously, things are picking up,” he said.
Despite this cautious optimism, Lamy said the Geneva-based body was maintaining its forecast of a 10 percent contraction in global trade this year as a result of world recession and the freeze-up in trade credit precipitated by financial crisis.
Lamy also said WTO members acknowledged South Africa’s argument for special treatment in the current Doha round of trade talks because of relatively deep cuts in industrial tariffs made under apartheid, which ended 15 years ago.
During white minority rule, South Africa was treated in trade terms as a developed country, rather than the developing status it now enjoys.
“South Africa had to take, at the time, tariff reductions commitments that were more stringent than other developing countries,” Lamy said.
“This is recognised. South Africa will, at the end of the negotiations benefit from specific flexibilities. That’s now recognised. How much of that is still to be negotiated,” he said.
The Doha round of talks to draw up a new framework for world trade was launched in Qatar in 2001 specifically to help poor countries.
However, a meeting collapsed a year ago and little progress has been made since then, with fundamental disagreements about farming subsidies and the United States and big emerging countries such as China and India pitted against other.
In the last 12 months, political leaders across the spectrum have talked at length of the need to revive the talks, leading Lamy to say the goal of wrapping up the mammoth negotiations some time next year was “do-able”.
Diplomats and trade experts in Geneva are now on the northern hemisphere summer break, but Lamy said he expected renewed energy come September, especially since an apparent rapprochement between Washington and New Delhi.
“From September on, following a number of positive political signals, notably from the US and India, my hope is that … the negotiating activity will move up,” he said, adding that the technical issues of concluding such a complex series of negotiations would remain a challenge.
He also said all WTO members, including the United States, accepted the need for major cuts in cotton subsidies. The so-called C4 West African countries of Benin, Burkina Faso, Mali and Chad argue the US subsidies depress world prices and rob their farmers of export sales.
“Everybody knows that cotton trade-distorting subsidies will have to be very substantially reduced. The US knows that. It’s just a question of when they confront their domestic constituency,” Lamy said.
U.S. trade representative Ron Kirk said on Friday Washington would only cut its annual support to U.S. cotton farmers as part of a wider deal whereby developing countries such as India and China opened up to US cotton exports.
The issue is likely to feature prominently on a trip by Kirk to Kenya, Ethiopia and Senegal this week.
–Agencies