Increased trade brings development

During the November 2001 World Trade Organisation (WTO) meeting in Doha, Qatar, the WTO member- states agreed to place development issues at the forefront of the new round of trade liberalisation negotiation.

The decision to focus on development, popularly known as the “Doha Development Agenda,” was premised on the consensus that removing global barriers to trade is the best manner to promote worldwide growth and foster prosperity in developing countries. Trade ministers are meeting in Cancun, Mexico, September 10-14 to conduct a mid-term review of the progress in the negotiations, and to provide negotiators further guidance to conclude the negotiations by the end of 2004. Roughly two years down the road, the importance of focusing on trade as the principal means to ensure growth and development is ever more apparent. Expanded trade brings jobs, investment, and expertise into developing countries, and through increased integration into the global market, allows developing countries to benefit from the rising tide of global prosperity. Open markets also produce important social and political benefits. As President George W Bush stated in his first address to the US Congress, “free trade brings greater political and personal freedom.”

This month’s Cancun Ministerial Meeting represents a critical midpoint in the negotiations to promote economic growth, development and opportunity around the world. The negotiations are far from over. In Cancun, we hope that Ministers from WTO member countries will create a framework within which ambitious negotiations can take place as we move toward the scheduled conclusion of the Round at the close of next year. One very important issue for developing countries has already been resolved — access to medicines for the poorest countries. By addressing that top priority, the WTO has set a positive foundation for the talks in Cancun. The United States is pleased that WTO members struck the proper balance to provide the poorest countries access to medicines to fight HIV/AIDS, malaria, tuberculosis and other epidemics while ensuring that the global intellectual property system that fosters the development of life-saving drugs is not abused. The Doha Round offers the world a once-in-a-generation opportunity to remove barriers to trade and thereby stimulate economic growth in developed and developing countries alike. A dedicated effort by all WTO members is necessary to invigorate the trade liberalisation process that fosters the formulation of a more open, peaceful, and prosperous world. At the core of the Doha Development Agenda is market access: agricultural reform, reduction and elimination of trade barriers on consumer and industrial goods, and liberalisation of trade in services.

The reform of agricultural trade is a priority in Cancun. The United States has led by proposing ambitious agriculture reform to increase market access, reduce global trade-distorting domestic support by more than US $100 billion annually, and eliminate export subsidies. In response to requests from other WTO members, the United States and the European Union circulated a shared proposal that would advance each of those pillars. This framework was intended to galvanise the negotiations and reflects movement by both the United States and the EU. It is not a final negotiating document, and we will be working with other members to address the issues in the framework at Cancun. Indeed, other members have put forward proposals using a framework approach. Though virtually all WTO members agree that agriculture is key to success at Doha, we cannot overlook the importance of the much larger trade in non-agricultural products and services. Collectively, these issues are critical to the long-term health of the trading system. Liberalisation in services and non-agricultural market access will provide substantial benefits to our own economies, and in aggregate to the world economy. All countries must cut tariffs on goods and lower barriers to trade in services. Seventy percent of the tariffs the developing world pays are to one another. Within the negotiations, there is certainly room to address the special sensitivities of the developing world. However, the biggest gains will go to those who open themselves to the opportunities the globalised world provides — increasing trade, investment and economic integration.

As the World Bank has noted, the developing countries that most widely opened their markets to trade in the 1990s grew three times faster than those that did not. The United States and its trading partners have worked closely in this and previous trade rounds to achieve our common objectives, lowering barriers to trade, promoting economic growth and development and providing greater hope and opportunity to the world’s farmers, workers, consumers and businesses. We must continue to create opportunities for open trade, and ensure that the world’s developing societies share its benefits. We all recognise that, in striving to achieve these opportunities, we all must assume our collective and mutual responsibility for making sure the multilateral trading system continues to deliver further openness. By enabling developing countries to diversify their exports and promote their economic integration into the world economy, WTO members will go a long way toward ensuring a brighter, more secure economic future for all.