COMMONWEALTH OF DOMINICA  
Statement by the Honourable Edison C. James,  
Prime Minister

The 50th Anniversary of the establishment of the multilateral trading system provides the opportunity for an evaluation of the achievements and shortcomings, as well as the challenges and opportunities facing the global economy.  We recognize the crucial role that was played by the GATT and its successor, the WTO, in encouraging open trade regimes and dismantling tariffs and non-tariff barriers in the trade in goods and services.  The primacy of a transparent, fair and equitable rule-based multilateral trade system under the WTO, including the development of regional trading agreements can safely be reaffirmed by all countries.

This is not to say that all countries have seen the benefit of the system.  In fact throughout these 50 years there have been clear evidence that a large number of countries, all of them developing countries, and particularly least-developed countries, have been falling behind.  In the four years since the establishment of the WTO even clearer disturbing signs have emerged of trends that point in the direction of exclusion rather than inclusion and of marginalization rather than integration.  Moreover, these trends are beginning to have quite serious negative effects on confidence in countries which only a short time ago were viewing their future prospects with some considerable optimism.

Developing countries, and particularly the least-developed, have derived the least benefit from trade liberalization in spite of measures taken in the GATT, beginning in the 50s, to assist these countries, including the adoption in 1979 of the “Enabling Clause” which made the principle of special and differential treatment for developing countries a part of the GATT legal framework.

We welcome the initiatives that have been taken within the WTO framework in the implementation of the Plan of Action for Least-Developed Countries agreed at in Singapore.  The High Level Conference held last October demonstrates that the WTO is conscious of the needs of the least-developed countries.  We congratulate Member Countries, both developed and developing, as well as the cooperating International Agencies for their important contributions to the Plan and hope that it will be implemented expeditiously.

But I speak for a Country and a Region which do not fit easily into any of the WTO classification of countries.  They are those other categories of developing countries caught between the emerging economies and the least-developed, the needs of which are being overlooked.  I make specific reference to small developing economies such as Dominica, which are facing the challenge of building their export and institutional capacities to allow them to become effective participants in the new highly competitive global environment and thus avoid marginalization.

If small developing economies are to be able to attract investment, expand production, improve product quality, meet standards, in short compete effectively and grasp the opportunities presented in the WTO Agreements, then it is imperative that their need for adequate transitional periods and for support be also recognized.

But, while we press for more attention to be paid to our particular concerns, we recognize that it is up to us to identify our problems, and articulate these in the WTO and other international organizations, working with them to ensure that we rise above our constraints.

One very troubling area is the recent experience we have had in the resolution of the dispute on the EU banana import regime.  It has had an adverse impact on trade with our trading partners and undermined confidence in the WTO process.  We believe that there are some important principles and procedures requiring improvement as we begin the review of the Dispute Settlement Understanding (DSU).  The so-called “systemic” complaints raised by a major trading partner, not only run the risk of upsetting the balance of rights and obligations, but also undermining the balance of benefits to developing countries, laboriously negotiated during the Uruguay Round.

We are particularly concerned about the blind and insensitive application of WTO Rules which could have the effect of nullifying all the efforts being made to prepare the economies for integration into the World Economic System.

I say these things not to sound alarmist bells but because I speak for a country whose economy has traditionally depended on a single crop, bananas.  This crop is well suited to conditions in my country as well as in all of the Eastern Caribbean and other countries in the Caribbean Community.  In the case of the Winward Islands, it accounts for well over one half of all export earnings and about a fifth of GDP.  The industry is the major source of employment, and the majority of households receive an income, directly or indirectly from the production and marketing of bananas.  It is a rural industry in which almost the entire rural community is engaged, producing bananas on predominantly small family plots, often situated on hill sides.  A substantial number of the banana farmers are women.  At the moment, there is no system more guaranteed to ensure that a cash income reaches the neediest in the society or to address the special problems of the rural poor.  In addition to its contribution to economic development the banana industry is, therefore, a significant guarantor of social and political stability not only in my own banana producing country but in the entire Caribbean Region.  I cannot therefore assess 50 years of the multilateral trading system, especially its evolution since the establishment of the WTO, outside of the context of its treatment of the trade in bananas and its impact on our countries.

In a small island economy the development options are not many.  The reform process is painful and the diversification process difficult.  More over, all of these initiatives depend for their success on increased financial resources to fund infrastructure, training, and to gain access to technology.  Increased financial flows, in turn, depends on a stable economic and political environment.  It is therefore not sufficient to talk about the non-discriminatory character of WTO.  The institution must also promote and defend an orderly trading system that seeks to spread the benefit of global economic growth and trade to all countries, irrespective of their size or level of development.  It may well be that the task is beyond the WTO acting alone.  In this case, in addition to the Geneva based institutions, it might be necessary to engage other institutions whose development missions may be more all embracing.

Thus as we structure the agenda and define the work programme for the period ahead we will need to bear in mind certain important considerations that have not so far been allowed to inform earlier deliberations and decisions.

It will bear repetition that because of their inherent deficiencies some countries are not now able to take advantage of the many opportunities being presented as a result of the liberalization process in spite of the tremendous efforts that they are making to position themselves to obtain at least some of the benefits of the system and in spite, also of their enormous commitment to reform.  It is simply a fact that the WTO membership consists of countries at varying levels of development and different trading interests.  The system must be able to respond to the different needs, in order that all countries among them, prominently, small island developing States could derive some benefit.  Above all it is important to recognize that the necessary adjustments to a global economy will not proceed at the same pace in all countries nor have the same effect in all places.

In this regard, as we look to the period ahead the focus of the WTO, should be on implementation of the existing agreements and the built-in agenda, and on closing the gap which exists between its Member States.

An essential requirement of this work programme should be an evaluation of the impact of the implementation of the agreements to determine the benefits to or adverse effects on developing countries.  Specifically, there should be an evaluation of the Agreement on Agriculture to determine the extent to which countries are meeting their reduction commitments and the impact on Net-Food Importing Developing Countries especially with regard to the Ministerial Decision on the possible negative effects of the reform programme on least-developed and net-food importing developing countries.

In relation to new negotiations a point which cannot be stressed too often with regard to new issues, is the ability of small developing countries to cope with the WTO's present and future work programme, which will involve negotiations.  The inability of national administrations to adequately prepare for negotiations could adversely affect the level of their participation.

We propose that machinery be established within the WTO to examine the special circumstances of small States, particularly islands, given their recognized fragility and vulnerability, with a view to determining how the rules could be structured to take into account these disadvantages.

As our countries increase efforts to implement the WTO Agreements, due recognition should be given to the need for adequate transitional periods and for support of our efforts at the national level.  In this regard, we would emphasize the need for continuing and increasing the technical assistance provided by the WTO, UNCTAD, ITU and relevant agencies to enable our countries to participate more effectively in the WTO arrangements.  

I think the period ahead is an exciting one for multilateral cooperation in trade, investment and other areas, and the Caribbean Community is doing all it can to position itself to participate fully in the global process.