World trade issues update

14/10/2003

First of all, I want to assure you that I and the Labour Government are committed to reforming the rules of world trade so that they work in the interests of developing countries. That is why we signed up to the current round of world trade talks in Doha in November 2001, and that is why we will continue to work for its success.

All countries stand to gain from a completion of the Doha round of trade talks, but the poorest stand to gain the most. For that reason, the failure of the 146 countries of the WTO to reach agreement at the Cancun summit in September was a setback. But it is not the end of the round of talks, and it is certainly not the end of the WTO itself.

We now need to lift our sights once more to the prize that is on offer if we can get the round back on track. Calculations by the World Bank indicate that if all barriers to trade in good were eliminated, then 300 million people could be lifted out of poverty by 2015.

The WTO agreed a new deadline of 15 December to try and resolve the issues we could not sort out at Cancun. Patricia Hewitt, Secretary of State for Trade and Industry, has already spoken to the Director General of the WTO, Dr Supachai Panitchpakdi, about how we in the UK can help to drive this forward.

Significant steps have already been made during the course of 2003 that will help an eventual agreement:

• Earlier this year, an agreement was reached on access to medicines for developing countries. This still stands and must now be built upon, particularly through the Global Fund for HIV/Aids, TB and Malaria.

• In June, the EU Agriculture Council agreed significant reforms to the Common Agricultural Policy – reforms that will mean substantial cuts in the trade distorting support and export subsidies we give to our own farmers and which do so much damage to the farmers of the developing world. This has long been an aim of the Labour government in Britain and is not conditional on agreement at Cancun.

• We saw at Cancun the formation of the G21 and other strengthened developing country groupings. This is wholly to be welcomed – indeed the UK helped it to happen through the £110m we have given to trade related capacity building and technical assistance since 1998 – with an additional £50m announced in September 2003.

Furthermore, at Cancun itself, real progress was made in discussions on agriculture and other vital issues. There is no doubt that an agreement was closer by the end of Cancun than at the beginning. In particular, Commissioner Lamy, on behalf of the European Union, offered to completely abandon negotiations on two of the so-called ‘Singapore Issues’, investment and competition, a position that was fully supported by the British government.

Action Aid welcomed this development, stating:

Action Aid welcomes the statement of the UK government confirming that this is now the new position of the EU, and calls on the government to ensure that this change is permanent.

In the words of Oxfam:

The UKÂ’s support for the four West African cotton-producing countries in advancing their case at Cancun was significant, especially as this issue came to symbolise the unfairness of existing world trade rules. We are pleased that in her statement to the House of Commons, Patricia Hewitt wholeheartedly welcomed the emergence of a stronger voice for poorer nations. Similarly we welcome her acceptance that post-Cancun, WTO agreements on investment and competition are off the EUÂ’s agenda.

This government values its dialogue with campaign groups on trade issues and will continue to listen to what they have to say as we strive to make trade rules work better for the poorest of the world.

GREG POPE MP

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