Mike Moore's speeches
Renato Ruggiero's speeches,
Round Agreement signed in Marrakesh in April 1994 to establish the World Trade
Organization ensures change within continuity: continuity in the sense that the
philosophy, culture and specificity of GATT will not evaporate or vanish, but instead will
enrich the new spirit of WTO; and change, because the deep transformations experienced by
our world in terms of technological breakthroughs, globalization and liberalization
necessitated this change. That is why together we shaped a set of dynamic rules,
disciplines and structures that take account of the changing realities of our world, and
provide a dynamic cooperation and reform.
It is therefore a good
opportunity for us to look back on our achievements and for me to briefly reflect on the
past and have together thought sharing. I know very well that not everything that we and
our predecessors have desired has been accomplished. But this is, I believe, the time to
stress our achievements and successes on which we can build our future efforts to advance
the multilateral trading system. And I strongly believe that there is a great deal that we
can all be proud of.
since 1947 has been marked by far reaching negotiating activity. Emerging from the
devastations of the second World War and from the protectionist policies that ruptured the
world trading system during the inter-war period, the GATT was a milestone in the
evolution towards a new world trading system. Eight rounds of multilateral negotiations
were directed towards a dual goal; first, the creation of a rule-based system designed to
reduce the uncertainty surrounding transactions across national frontiers; and second, the
reduction or elimination of tariffs and non-tariff barriers to imports that hindered the
growth of international trade. Together, these actions stimulated trade-related
investment, increased economic efficiency, created higher-paying jobs, and benefited
consumers through lowering the prices.
words, we have all supported these negotiations with the objective of reaching better
conditions for both producers and consumers in order to greatly improve the opportunities
for countries to achieve faster economic growth and therefore to help them to embark on
social development including raising the standard of living of their populations and to
deal with problems of unemployment and poverty, which was the main concern of the Social
Summit. The fact that we have gone through eight rounds of multilateral trade negotiations
is the best proof of our recognition of the importance of lower trade barriers, I mean
freer trade and the need to transform the world trading system into a rule-based one
guided by the principles of non-discrimination and transparency.
worthwhile noting that when it was signed in 1947, the General Agreement had only 23
members. As we moved along, we were determined to expand the GATT membership to ensure
that the benefits of the trading system could accrue to a larger number of countries.
Since a larger constituency creates a larger market for the existing and new members, from
which both sides clearly benefitted. By the end of last year, when I was Chairman of the
GATT Council of Representatives, as we were just about to close the GATT chapter, the
total number of GATT contracting parties reached 128. This clearly indicates a strong
desire to reach universality as more and more countries sought to share in the benefits
that the multilateral trading system provides.
first six rounds of negotiations under GATT, the main focus was on the reduction of
tariffs. Among the developed countries, the average tariff on industrial products was
reduced from more than 40 per cent in 1947, to around 10 per cent after the implementation
of the Kennedy Round. Once the tariff cuts negotiated in the Uruguay Round are fully
implemented, the average will be below 5 per cent. This reduction in tariffs is clearly a
great achievement. In addition, more and more countries - including a large number of
developing countries - have deepened and widened the coverage of their tariff bindings.
the expansion of the negotiations beyond tariff reduction, there was also an expansion
beyond the original focus on industrial goods. The early rounds of negotiations did not
address other areas of trade such as agriculture and services even though they constituted
a significant share in world trade. "Sensitive" products such as textiles and
clothing were also excluded. It was not, therefore, surprising that interest grew to find
ways and means of addressing these excluded sectors, until they were successfully covered
by the Uruguay Round. It is only fitting that the last round of negotiations under the
GATT was the most ambitious and most successful international economic negotiation since
of our aspirations for a better world trading system have produced tangible results. When
we look at statistics concerning the growth of world trade and world output we immediately
see the contribution we have made through our efforts to improve the world trading system.
As the Director-General already noted in virtually every year of the post-war period the
growth of world merchandise trade has exceeded the growth of world merchandise output.
Between 1950 and 1994, the average annual rate of growth of world GDP was just under 4 per
cent in real terms. In contrast, the average annual rate of growth of world merchandise
trade - at more than 6 per cent, also in real terms - was considerably faster. During
those 45 years, world merchandise output increased 5.5 folds while the world merchandise
trade multiplied by 14 fold.
provide convincing evidence of the enormous opportunities provided by international trade
and of the central contribution of the GATT to postwar prosperity. The economic growth of
many countries has been increasingly stimulated by the growth of their trade, a fact made
possible by the improved conditions for trade that we have realized through the various
rounds of negotiations.
It may be
that the bright future will require further liberal initiatives. I am thinking, for
example, of the need to consider further reductions in the tariffs on agricultural trade
and to consider expanding the range of commitments in the area of services. We are all
aware of suggestions that new initiatives may be contemplated and studied in such areas as
investment and competition policies. It is also important that our membership continues to
expand to include countries that have stayed away from the GATT/WTO system. Among those
negotiating their eventual WTO membership are China, Russia, numerous Former-Soviet
Republics, African, Arab countries and others for which WTO membership offers not only
important trade benefits, but also an opportunity to increase the credibility of the major
economic structural reforms they are undertaking. This move will ensure our call for the
universality of the multilateral trading system so the new organization would deserve its
At the same
time, it is necessary to keep in mind the challenges we face and the limitations of our
endeavours. We can create conditions that are conducive to economic growth and to the
growth of world trade. But the actual growth of trade and output will also depend on other
developments that we cannot influence in this forum. This means that our success is
closely linked to the successes of national policies and to a healthy contribution of
other factors that are crucial to economic growth, such as education and high levels of
savings and investment. What we can do is to ensure that existing WTO commitments are
fully and effectively implemented, bearing in mind the special and differential treatment
for the less developed countries and the enforcement of the decisions adopted by the
Ministers at Marrakesh particularly with regard to the least developed countries and Net
Food Importing Developing Countries. Against this background the new WTO system will be
continuously dynamic keeping pace with the globalization of the world economy.
the effectiveness and the credibility of the system it is imperative that we all implement
and respect the commitments of the Uruguay Round Agreements. This applies to the
commitments to make the best possible efforts to expand export benefits to the least -
developed countries. I would like also to stress that since the WTO only provides a
framework for trade development, we need, in order to derive the maximum benefit out of
it, to ensure the effective functioning of the WTO Dispute Settlement Mechanism. In this
respect, it is imperative that each member refrain from resorting to unilateral actions
and from employing trade distorting protective measures in an abusive or arbitrary manner.
Each party to the WTO is committed to ensure that domestic legislation corresponds to the
rules and requirements set out in the Uruguay Round Agreements.
I would like
also to underline the importance of the examination process of regional trading
arrangements. The link here with the credibility of the strengthened multilateral trading
system is obvious. And I hope that the consultations going on right now will improve this
those obligations, we can be confident that we will be making our contribution to the
economic betterment of the present and future generations. And by so doing, we will be
re-affirming our faith in the wisdom of the fundamental principles of the GATT system and
their continuing relevance to economic relations in the twenty-first century.