SUNS4509 Thursday 16 September 1999

Trade: "I won't dissuade North against new issues," says Moore

Marrakech 14 Sept (Martin Khor) -- The new director-general of the World Trade Organization, Mike Moore, told a press conference at the G77 Ministerial Meeting here that he would not attempt to persuade industrial countries not to take up new issues in the forthcoming WTO Seattle Conference.

The press conference was jointly by the heads of UNCTAD, WTO and the International Trade Centre.

Moore was answering a question whether, if he wanted to help developing countries in the WTO, he would ask developed countries not to insist on new issues in the current WTO negotiations. Developing countries were already unable to cope with the problems of having to implement the existing Agreements and their
interests would be damaged if they also had to negotiate new agreements proposed mainly by the North.

Mr Moore was also asked to comment on the call by the Chairman of the G77, Guyana Foreign Minister Clement Rohee, to make the next Round focus on a "Review, Repair and Reform" of the WTO, without
developing countries having to give in to new issues in return.

Moore, who in the opening plenary had pledged his commitment to helping developing countries in the WTO, somewhat lost his cool and replied that he would not attempt to persuade the developed countries against taking up new issues because issues such as trade facilitation and the needs of least developed countries
would be to the benefit of developing countries.

It was not clear how Moore came to the view that needs of least developed countries was a 'new issue' -- given the repeated phraseology in every agreement about the special needs and promises of benefits to the LDCs.

And informal exchanges and consultations at the WTO in Geneva have made clear that the US and the EU, in promoting 'trade facilitation' are aiming at further opening of developing country markets to their corporations, and not really the other way round.

"I will not influence the developed countries against new issues," Moore reiterated, adding that the world economy is not standing still. He cited the example of electronic commerce, which he said a few years ago electronic commerce was not a major medium.

He agreed however that developing countries were facing problems trying to absorb policy changes. "There are real problems of implementation for developing countries and we should focus on this."

Another journalist asked whether it was not true that the WTO had become a voice of industrialised countries and how could the WTO achieve development goals.

Moore said the WTO is not GATT. The WTO reflects a new number of countries and his responsibility was to ensure the voice of the WTO represents the wide reach of Members.

He added that during the Asian crisis, the North did not protect their economies, and the trade system held firm and thus contributed to the Asian economies bouncing back.
"We need a new Round taking into account small economies," said Moore and added that a more transparent regime for government purchases is in the interests of developing countries.

This remark evoked a question as to whether trade liberalisation itself had contributed to financial crises in developing countries, since UNCTAD studies had shown that trade liberalisation had widened the trade deficits of many developing countries, and made them dependent on inflows of capital that helped cause financial crises.

UNCTAD Secretary-General Rubens Ricupero replied that when UNCTAD was organised in the 1960s the slogan then was "trade not aid."

"We now need a new slogan, Exports, not Hot Money!" he said.

Developing countries, Ricupero said, need market access to the North, and not the wide trade deficits that have to be financed by short-term finance. Developing countries had developed trade deficits which when too big required short-term and volatile finance to cover.

"We should strive for trade negotiations where we provide more export opportunities to developing countries," he said. In textiles and clothing, there is a need to reduce the high tariffs and not just remove the quotas; in agriculture, there is no justification at all for the high export subsidies; and in industry, there is a need to reduce tariff peaks and escalation (especially for processed foods, clothing and metal articles).

"Everyone knows where the problems are. What is needed is to give priority to these practical matters. Then developing countries don't need to be dependent on short-term finance. I don't see any other way."

A Moroccon journalist said it appeared UNCTAD is shaped by the poor and the WTO is shaped by the rich countries. How then could there be talk of a common agenda?

Ricupero said UNCTAD had defined a relationship with WTO in a mutually reinforcing way.

"We help developing countries prepare for negotiations. We don't meddle with the WTO's core duties, rule making, rule implementing and dispute settlement. We work harmoniously together."

Both Moore and Clair Short (UK minister) had said the next Round should give priority to development.

"To meet this goal, the ball is in the developed countries' court. There is not much we can do. Most developing countries have liberalised much more quickly in the last few years than developed countries, which have liberalised at a slow pace.

"For agriculture, the transition period is over 50 years now and it is not complete yet. Developing countries are also much more fragile. For further liberalisation, developed countries need to make tough decisions in the heart of protectionism, which is agriculture, textiles, footwear etc."

Moore, in his reply, said two significant events had just taken place: he was the first non-European WTO director general, and he was the first D.G. to come to the G77 Ministerial Meeting.
"I get irritated when people say the WTO is a rich man's club," he said. "Globalisation has shown that living standards in a country depends on the living standards of neighbours."