US urges emerging powers to open markets
Big emerging countries such as China, India, Brazil and South Africa must do more to open their markets to secure a new global trade deal, the United States trade chief said on Wednesday.
US Trade Representative Ron Kirk, who took up his job in March, was speaking after two days of intense talks with US trade partners at the World Trade Organisation (WTO), and said his reception could not have been better.
Kirk said both he and President Barack Obama were committed to reaching a deal in the WTO’s long-running Doha round.
“We see it not only as a critical component of what the president believes should be an overall worldwide response to the current economic crisis, but it’s also critical to the sustenance of many of our least developed countries,” he said.
But he told a news conference—in a clear message to the big emerging powers—that a deal required more than participation by the US.
In his talks, Kirk met representatives of more than half the WTO’s 153 members, including African and Latin American countries and the European Union—the biggest US trading partner—as well as with WTO Director General Pascal Lamy.
Kirk said the economic crisis was hurting nations like China and the US but causing unbearable pain to the poorest countries, who Washington believes should not be asked to make further sacrifices to reach a deal on Doha.
With the US market already fully open to 98% of goods from least developed countries, their next opportunities would come from the big emerging countries, who should open up their markets to create a “win-win-win” deal, he said.
The Doha round was launched in late 2001 to help poor countries prosper through more trade in food, goods such as cars and clothing, and services like telecoms and banking.
But to sell a deal back home, US negotiators will need to point to new opportunities for American businesses too, and the former Dallas mayor said a Doha deal would have to bring meaningful gains in market access for all countries.
He said the US did not want to throw away the work that had gone into the Doha talks over the past seven years, but clearly the process was not working, and Washington is looking for new ways forward.
One possibility under consideration is to drop the effort to agree on a general formula for cutting tariffs and subsidies, known in trade jargon as “modalities”, and go straight into “scheduling”—negotiating cuts in import duties and other moves on a bilateral basis. Kirk did not rule this out.
It would have the advantage of letting US businesses—whose support is critical to getting a deal pushed through the US Congress—see quickly what they are getting, but is likely to be resisted by developing countries who fear they could be strongarmed into a deal.
Kirk’s visit was part of a trade policy review by the new White House, and he is expected to give details of his thinking in a keynote speech on Monday at the US Chamber of Commerce.
He professed delight with his reception, the “frank, candid but useful” talks and the enthusiasm of US partners at the new administration’s willingness to re-engage with the world. The trade review should be seen as part of that process, he said to dispel fears that Washington could come out with new demands.
Christopher Wenk, senior director of the chamber of commerce, said that by visiting the WTO ambassadors early in his tenure, Kirk had sent an important signal.
“Hopefully his trip has built up enough goodwill among our key trading partners to consider whether we need to pursue a new way forward to achieve a successful outcome to the Doha Round,” he told Reuters.
Kirk reiterated the administration’s support for Russian membership of the WTO, but said the next moves were up to Moscow—including reversing its import ban on US and Canadian pork, imposed after the outbreak of H1N1 influenza known as swine flu.
Kirk said there was no scientific evidence that eating properly prepared pork could expose people to the flu, and warned other WTO members not to exploit legitimate health worries for financial gain through pork import bans that added to protectionist pressures when trade is already slumping.—Reuters