World Bank Group President Robert B. Zoellick wants the United States, India, and China to work with WTO Director General Pascal Lamy to come up with a compromise on the Doha round of world trade talks.
Brazil, a developing country that is both a major agricultural exporter and home to many poor farmers, can help, he said in a statement Monday. Indonesia and Australia may be in a position to contribute to a solution too. “As the dust settles from the breakdown of the WTO negotiations in Geneva, some parties are recognizing that there was a good package of results left on the table,” Zoellick said. “It would be a mistake for the world economy and harmful for developing countries not to retrieve it.”
He said President Lula da Silva of Brazil is right in calling on the parties not to let the WTO negotiations fail because of differences over a special safeguard for agriculture. “Given the high food prices around the world and the need for poor people to lower their cost of food, it just does not make sense for the Doha negotiations to founder upon this barrier,” he said asking the US, India, and China to come up with a compromise working with Lamy.
Suggesting ways to solve the problem, Zoellick said: “Since the purpose of a safeguard is to help cushion the effect of a significant increase in imports on local producers, an acceptable justification for the safeguard could require examination of factors in addition to increased trade flows.” “A big problem with safeguards is that once a country triggers them, it can take two years or more to challenge the grounds for imposing them,” he said. “In the meantime, the new barriers block trade. So a compromise could create a speedy due process for challenges, without appeal.” All parties seemed to agree that safeguards should not be imposed to block normal trade flows, but they disagreed on how much of a change warrants the temporary protection of a safeguard, Zoellick said.
While under current WTO practice, the economy imposing a safeguard decides how much protection is appropriate, he suggested, “this protection could be disciplined and limited. It may be understandable that tired negotiators couldn’t assemble these and perhaps other variables in a way to solve the problem,” Zoellick said. “But they should not quit trying” as with this many elements to deploy, people who want a deal should be able to achieve one.
There is too much at stake to let this problem derail a global trade package that could expand economic growth and opportunity by cutting cut subsidies drastically, lowering tariffs significantly, and opening up services markets, the World Bank chief said. “There is a good Doha deal still to be seized,” Zoellick added. (The Economic Times)