WTO chief claims Vajpayee supports new round

by C. Rammanohar Reddy

Madras, 19 May 2001 -- More than 18 months ago the Seattle ministerial meeting of the World Trade Organisation collapsed, in part because of unbridgeable differences on the agenda for a new round of negotiations for further trade liberalisation.

These differences have not been narrowed very much in spite of a flurry of activity at the WTO headquarters in Geneva and in the capitals of some countries. But that has not prevented those interested in a new round to claim that there is more support for the proposal than is the case.

The latest example of the “creation” of such reports is the statement of Mr.  Mike Moore, Director-General of WTO, who in an interview in Paris to the AFP news agency said, “...the ASEAN ministers, the G7, the Prime Minister of India, the Chinese want a round.”

Mr. Atal Behari Vajpayee (Prime Minister of India) will be surprised to hear of his supposed support for a new round for he has never said anything on those lines. And the response of government officials is that there is no change in India’s position of first wanting the imbalances in the Uruguay Round agreement corrected before discussing the proposals for a fresh round of negotiations.

In the present context of widespread fears and hostility towards the WTO in India, Mr. Vajpayee and his Government are hardly likely to change their stand.  The European Union has been consistent in campaigning for a new broad-based round of WTO negotiations that will include new items on the agenda such as a global pact on the rules for foreign investment. The EU hopes that this round - potentially as ambitious and therefore as controversial as the Uruguay Round of 1986-93 - will be launched at the WTO ministerial meeting to be held in Doha this November. The US under Mr. George Bush views a new round with more favour than the Clinton administration. However, Mr. Bush is yet to submit a request to US Congress to give him the “fast-track” authorisation that is essential for the US to meaningfully negotiate such a round at the WTO. And at the OECD ministerial meeting earlier this week, the ministers of this rich country club issued a call for a new round of multilateral trade talks at the WTO.

But at Geneva itself, after more than a year of discussions, member-countries are no closer to narrowing their differences that resulted in the collapse at Seattle in November 1999. Although much noise has been made about the need to address developing countries’ concerns about what are called the “implementation problems” in the Uruguay Round deal, there has been no progress after two years of talks. With close to 85% of the WTO membership - the developing countries - either strongly opposed to a new round or at best ambivalent towards the proposal, the support that the WTO chief sees for the idea is not yet founded in fact. It is indeed possible that tiredness and pressure tactics will work in Doha as they did during the Uruguay Round and a new set of trade talks will be launched there. But for now the differences remain. Hence the need for Mr. Moore, who has been travelling from country to country whipping up support for a fresh WTO round with an ambitious agenda, to proclaim that a fresh momentum for the launch of fresh negotiations was being generated.

It is possible that the WTO chief in his interview confused Mr. Vajpayee with his Finance Minister, Mr. Yashwant Sinha. A reporter from an Indian daily had reported from Washington during last month’s spring meetings of the International Monetary Fund and the World Bank that Mr. Sinha said that the developing countries were now in favour of a new round at the WTO.

That was a major turnaround but Mr. Sinha later denied having said anything on those lines. And since no other media had attributed such a statement to Mr.  Sinha, the denial is more likely to be the truth. But neither Mr. Vajpayee nor Mr. Sinha is going to take kindly to Mr. Moore citing their alleged support for this controversial proposal.

(* The above article first appeared in The Hindu of 18 May, and is reproduced with acknowledgement and permission. Mr. Ram Manohar Reddy is the Deputy Editor of The Hindu, a leading newspaper of India.) – SUNS4900

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