Bridges Weekly Trade News Digest • Volume 8 • Number 16 • 5th May 2004
Mixed Feelings On Trade As EU Enlarges
‘MICRO-MINISTERIAL’ DEBATES WAYS TO MOVE TRADE TALKS
Key trade ministers met in London on 1 May to consider how to break the deadlock in trade negotiations, focusing their talks primarily on how to move in agriculture. EC Trade Commissioner Pascal Lamy, Kenyan Trade Minister Mukhisa Kituyi, South African Trade Minister Alec Erwin and Brazilian Foreign Minister Celso Amorim attended the meeting, which was organised by US Trade Representative Robert Zoellick. The ministers discussed ways to agree on a package of proposals that would appeal to both developed countries and the group of 90 developing nations before a "window of opportunity" is closed by the US presidential election and a changeover in the European Commission in November this year. Following the meeting, EC spokesperson Arancha Gonzalez said ministers left feeling convinced they would be able to agree on a blueprint for negotiations by the end of July, including a framework for talks on agriculture and industrial tariffs, cotton subsidies and special & differential treatment for developing countries. A slightly broader mini-ministerial gathering, to be chaired by Mexico, will take place on the sidelines of the council meeting of the Organisation for Economic Cooperation and Development (OECD) in Paris on 14 May. Trade ministers from around 30 countries, including all the major trading powers, are set to attend.
On the eve of the "micro ministerial," a number of business organisations called on trade ministers to "fulfil their responsibilities" and exert joint leadership to ensure progress in the WTO trade talks this year. The 35 organisations, including the US Chamber of Commerce, requested "bold outcomes" on trade in industrial goods and services, particularly among developed and middle-income countries. The "Call to Leadership" petition also requested the elimination of all forms of export subsidies and trade-distorting domestic support "concomitant with substantial liberalisation of major agricultural markets worldwide".
To access the "Call to Leadership" petition visit http://www.nftc.org/default/trade/doha%20round/Joint%20Business%20Petition%20on%20the%20Doha%20Agenda%20April%202004.pdf
"WTO diplomats urge ‘meaningful effort’ to progress stalled trade talks," AFP, 2 May 2004; "Intl Trade Ministers Meet To Discuss Treaty Deadlock," DOW JONES, 1 May 2004; "Zoellick to host ’select’ dinner in attempt to meet Doha round target," FINANCIAL TIMES, 30 April 2004; "World Business Groups Call on Governments To Ensure Progress in WTO Talks This Year," INTERNATIONAL TRADE DAILY, 3 May 2004.
On 1 May, ten new member states joined the EU, adopting the Common Commercial Policy. The EU now comprises 450 million citizens, 18 percent of world trade and more than 25 percent of the world’s Gross Domestic Product. As the new member states joined the EU, trading partners provided a varied response, highlighting the benefits and disadvantages of enlargement. "The EU expansion is mixed baggage," said Nagesh Kumar, Director General of Research and Information System (RIS) for the Non-Aligned and Other Developing Countries. "The potential advantage of a bigger, expanded market would be diluted by the fact that labour-intensive goods from India would be at a disadvantage as new member countries would enjoy duty-free access," noted Kumar. For certain groups of countries such as MERCOSUR (Southern Common Market — Argentina, Brazil, Paraguay and Uruguay), the enlargement represents ”an opportunity, not a threat”, according to Argentina’s Deputy Foreign Minister Martín Redrado. ”The offer of improved access to the EU markets takes into account the greater European demand resulting from the expansion,” he added. Pakistan, on the other hand, has filed a provisional claim with the WTO seeking compensation to cover possible losses due to decreased Pakistani exports of rice, leather and other items following the accession. The new EU member states are: Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, the Slovak Republic and Slovenia.
"Pakistan to seek compensation via WTO for possible EU losses," ASIA PULSE, 29 April 2004; "Mercosur Trade Bloc Does Not Fear EU Expansion," IPS, 30 April 2004; "Expanded EU seen as bringing both opportunities, challenges," BUSINESS NEWS INDIA, 4 May 2004.
CSD-12 FOCUSES ON IMPLEMENTING TARGETS
The twelfth session of the Commission on Sustainable Development (CSD), which took place from 14-30 April in New York, was widely welcomed as an important opportunity to move forward on the implementation of the sustainable development targets set out in the Millennium Development Goals and the World Summit on Sustainable Development. The Commission meeting was the first to focus more on substantive issues and progress of implementation — in particular related to water, sanitation and human settlement — than on negotiating text. Chair Borge Brende, Norway’s Minster for the Environment and Chair of CSD-12, called on delegates to begin a "decade of keeping promises", envisaging the CSD to become the "watchdog" of progress on implementing global sustainable development goals. Discussions at CSD-12 reaffirmed the WSSD’s emphasis on poverty eradication as a central element of the sustainable development agenda. While many countries were found not to be on track to meet the water, sanitation and human settlement targets, these goals were thought to remain achievable with the proper means of implementation, including financial assistance, capacity building and technology transfer. In his opening speech, however, UN Secretary-General Kofi Annan warned that the recent emphasis on terrorism and the war in Iraq had diverted high-level political attention away from sustainable development, calling for balancing these concerns with a greater focus to environmental protection, social progress and economic growth.
CSD-13, tentatively scheduled for 2-13 May 2005 and to be chaired by John Ashe of Antigua and Barbuda, will again focus on water, sanitation and human settlement. For further information on CSD-12, see http://www.un.org/esa/sustdev/csd/csd12/csd12.htm.
ENB Vol 5, No 211, 3 May 2003; " Terrorism, Iraq Sap Energy From Sustainable Development," ENS, 28 April 2004.
US DROPS CHINA LABOUR RIGHTS CASE
On 28 April, the Bush administration rejected a call by domestic labour groups to investigate labour standards in China. AFL-CIO, the largest US labour federation, had filed a trade complaint with the US Trade Representative on 16 March asking the administration to impose economic sanctions on China (see BRIDGES Weekly, 18 March 2004). According to AFL-CIO, China was brutally repressing workers’ rights in order to gain a competitive advantage over the US, and this constituted an unfair labour practice under the US Trade Act. The Bush administration, however, responded that engagement was a more effective way to press for change than sanctions were. Robert Zoellick, US Trade Representative, said "We do not need to conduct a year-long investigation to know there are serious concerns with labour rights and working conditions in China as there are in many other developing countries. This administration believes that trade and economic growth, combined with the use of leverage to pursue mutual interests under agreed upon international rules, will move China faster and further toward achieving real results than a retreat into economic isolationism and the raising of barriers that block trade".
"US Won’t Investigate China On Alleged Labor Rights Abuse," DOW JONES, 29 April 2004; "Bush refuses probe into claims against China," FINANCIAL TIMES, 29 April 2004.