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> Lamy takes part in Hong
Kong Roundtable Forum
Ladies and gentlemen,
What a pleasure it is to be in Hong Kong China — the host of the WTO's
6th Ministerial Conference. When the location for the WTO's 6th
Ministerial meeting was decided, I was still Trade Commissioner for the
EU. And I can tell you that choosing Hong Kong China was one of the
easiest decisions that negotiators had to take in the so called “July
package!” In fact, it was one of the few decisions that hardly required
any negotiation at all! When this location for our meeting was chosen,
Hong Kong China's Permanent Representative to Geneva — Tony Miller —
promised us a wonderful time. He called on everyone that will be
attending the December meeting to come early and leave late. His
specific words were:
“If you are an athlete or antiquarian; gambler or gourmet; scholar or
sybarite; shop-alcoholic or otherwise addicted, Hong Kong China has
something to offer and to stimulate your appetite.”
I have only been here a day and half, and I can already confirm that he
Ladies and gentlemen, I am grateful to have an opportunity today to
discuss with civil society the expectations for the WTO's upcoming
Ministerial meeting. I have already said this in Geneva, and I say it
again now. For a successful conclusion of the Doha Development Round,
the Hong Kong Ministerial meeting must take us 2/3ds of the way. If it
does not accomplish that target, we may very well miss the end 2006
deadline that we had set for these negotiations. That deadline of course
corresponds to the end of the negotiating mandate of one of our Members
— the United States, whose Trade Promotion Authority would be expiring.
When I called for this 2/3ds target, I was mindful of the large amount
of technical work that would remain after the Ministerial Conference,
and which we cannot underestimate. That work will consist of translating
Members' promises into binding commitments in the WTO.
The WTO, as you all know, is the successor organization to the GATT,
which was created in 1947 to establish a fair, transparent and
predictable basis for international trade. In fact, to understand the
WTO's future, we must begin by remembering its past. GATT was the
outcome of the great depression and the second world war; a time in our
history where countries mistakenly believed that they could solve their
problems by living in isolation. The Hawley Smoot Tariff Act that had
raised US tariffs to their highest protective levels ever, had set in a
motion a trade war. The net result of that war was a sharp decline in
international trade, and a loss of welfare of massive proportions. But
from the mistakes of our past, came an important lesson for our future.
We need multilateral institutions that can make the world a more orderly
place. Hence our common responsibility to strengthen the WTO.
The WTO is far from being a perfect instrument. I myself have said this
on a number of occasions in my previous positions. But in addressing its
imperfections we must be careful not to repeat the mistakes of our past.
We need the WTO, and our goal should be to work together to make the
organization better reflect our aspirations. While this might sound to
you like a cliché, some of the WTO's greatest imperfections, like its
slow pace of negotiations, stem from its most positive attributes. Were
the WTO to not be democratic, the Doha Round may have been finished by
now. But that is not how the WTO operates. The WTO is a “consensus”
based organization, and only when consensus fails does it resort to a
With its total of 148 member states, the WTO votes on the basis of one
country, one vote. In so doing, it balances the interests of the big and
the small, the rich and the poor. Of course such inclusiveness in
decision making costs us time and effort, but it gives far more
legitimacy to the results that are reached. We must also remember that
WTO rules, and any changes that are made to those rules through rounds
of trade negotiations, must be ratified by Parliaments. That is a
process which must also run its course.
Since I have joined the WTO, I have been asked by representatives of
civil society on numerous occasions what the WTO does for, quote
unquote, “development”? I have sounded out 3/4 of our members, which are
the developing nations since I started. What every single developing
country has asked for is greater market access, and rules that are more
fair and balanced. Opening markets to products of export interest to
developing countries is in fact the greatest contribution that the WTO
can make to a country's development. But we must not forget in that
equation that imports are just as healthy for a country's economy as
exports. It is through greater competition that countries become more
efficient at what they do. Imports make them more competitive and enable
them to export. In fact, imports and exports are two sides of the same
Futhermore, rules that significantly reduce trade distortion in sectors
of interest to developing countries, and that simplify and improve
customs procedures — what we call “trade facilitation” in our jargon —
are also high on the agenda of developing countries.
This is why this round has been called the Doha “Development” Agenda.
“Development” therefore is not an island of its own in these
negotiations. It is the engine that drives the negotiations, in all of
its facets, forwards. What stands as testimony to this are the very
powerful developing country alliances that have formed. In fact, the
“Cotton 4,” the “G20,” the “G33” and the “G90” have succeeded in placing
their interests at center stage. Agriculture negotiations are now seen
as a key ingredient of the Doha Round, and that is primarily because of
the importance of this sector to developing nations. After all, 73% of
the poor in developing countries live in rural areas.
Benin, Chad, Mali and Burkina Faso, whose economies are heavily
dependent on cotton, have called for all trade distorting policies in
the cotton sector to be addressed in the Doha Round. These countries
have seen the international price of cotton fall by some 40% in recent
years, in part due to the subsidies that the rich hand out to their
farmers. Needless to say, this has had a serious impact on their
I am glad that last week saw several new proposals on agriculture. The
US and EC have shown a willingness start compromising, and developing
countries will eventually be called upon to reciprocate. Tariffs and
domestic support must be brought down. As for export subsidies, we must
now set a date for their complete elimination.
Developing countries will also need greater market access for their
industrial goods, for their services and for their ideas. We must help
them meet their aspirations through this Round.
Some people mistakenly think that the developmental aspects of the Doha
Round consist of its “special and differential treatment” components.
Special and differential treatment, which can take the form of longer
implementation periods, or lower reduction commitments, is indeed an
important element of the Round. Its importance lies in the fact that it
can facilitate the implementation of new rules by developing countries.
But it is not special and differential treatment that will itself
deliver developmental benefits for a country. Special and differential
treatment is simply there to remind us that developing countries
approach these negotiations from a different starting point.
Important to bear in mind in the Doha Round, is that any negotiation is
a “give and take,” and hence developing countries will themselves have
to do some opening. That opening, as I said earlier, does not hurt them
— in fact, in the long run it can only make them more stronger. There is
of course the problem of supply side constraints, particularly for least
developed countries. Because of these constraints, developing and least
developed countries may find themselves unable to benefit from the new
market access opportunities offered by the Doha Round. I am therefore
looking at the development of a substantial “Aid for Trade” package —
i.e. a program that would help boost the trade capacity of developing
countries and reduce the costs of commercial transactions. It would
translate theoretical trade gains into real ones.
In addition to tackling developmental issues in that very broad sense,
the WTO is also looking at a very specific set of developmental
questions. TRIPS and health is one of them. In these negotiations,
developing countries have already succeeded in obtaining the right to
import the generic equivalents of patented drugs for national health
emergencies. At issue now is how to enhance the legal certainty of the
agreement that was reached. The WTO is also looking at the relationship
between the TRIPS Agreement and the Convention on Biological Diversity.
There, developing countries are seeking to protect their traditional
knowledge. They also with to ensure that their “prior informed consent”
is obtained before the use of genetic materials that fall within their
territories. And there are many other developmental issues of course;
the list goes on.
The environmental aspects of the Doha Round are equally important. In
this Round, Members are exploring the relationship between multilateral
environmental agreements and WTO rules: for instance the Montreal
Protocol for the protection of the ozone layer. The objective there is
to ensure that WTO rules do not stand in the way of legitimate
environmental objectives. Members are also looking at how trade rules
could discipline environmentally harmful practices, such harmful
fisheries subsidies. In addition, they are exploring the liberalization
of trade in goods and services that can be useful for the environment,
such as catalytic converters and air filters. Such liberalization would
enable countries to access these goods and services cheaper, making them
more widely available to all.
As the Doha Round progresses it is vital that the WTO continue to engage
civil society. For me, civil society and governments are both important
interlocutors. I have only made two entries so far in my diary for trips
to Hong Kong China. One, was to meet you, and the next will be to meet
The WTO engages civil society in a variety of different ways. Through
the annual Public Symposia that it organizes, governments, the WTO
Secretariat and civil society have the opportunity to interact. But
civil society interacts with the WTO in other ways too. For instance,
members of civil society can send amicus curiae briefs (which are
“friends of the court” briefs) to Panels and the Appellate Body in the
context of the dispute settlement. This is in recognition of the
importance of civil society's views.
In fact, last month the WTO witnessed an important evolution in its
dispute settlement process with its first “public” hearing. In a dispute
between the US, Canada and the EC on hormone-treated beef, the parties
agreed to open the doors of the WTO court house for the broader public
to see. Such a decision, which can only be taken with the agreement of
the parties, was an important step towards greater transparency. It is
in that spirit that I will end now, and listen to your views. They are
important to me.
I thank you for your attention.