> Roberto Azevêdo’s speeches
Ladies and gentlemen, it’s a pleasure to be here.
The UK has a special place in WTO history.
It was, as you know, one of the eight founding members of the General Agreement on Tariffs and Trade, which is the precursor of the WTO.
In fact the second round of GATT negotiations was held in the UK — in Torquay — in 1950, and successfully reduced tariffs by around 25% on 1948 levels.
But even before that the UK was playing a very important role for the multilateral trading system.
At the famous Bretton Woods Conference of 1944 which launched the IMF and the World Bank, John Maynard Keynes and his colleagues recognised the need for a comparable international institution for trade — to be known as the International Trade Organization.
A preparatory committee charged with creating this body was established. And in 1946 it held its first meeting here in London — in Church House — just a few meters, I understand, from where we are now.
There were many twists and turns along the way, but that meeting constitutes a crucial chapter in the creation of the WTO and I am happy to acknowledge that the UK’s commitment to the multilateral trading system has remained strong and unequivocal.
I’d like to thank the ICC and CityUK for arranging this event.
But I’d also like to take this opportunity to thank you all for your support in delivering the Bali package in December.
The business community in the UK — and around the world — played an absolutely crucial role in creating the conditions in which a deal could be struck.
And the significance of Bali bears repeating.
For one, Bali demonstrated for the first time that the WTO can reach multilaterally agreed outcomes. It was the first such deal since the organization was created in 1995.
It announced to the world that the WTO is back in business. And it also demonstrated that we can deliver for business in a big way.
Once implemented, the Bali Package will provide a shot in the arm to the global economy, delivering growth and jobs.
The Prime Minister himself called it an historic agreement, which would be a lifeline for the world’s poorest people. But, moreover, he pointed to the boost that Bali could provide to British businesses.
It is estimated that Bali was a trillion dollar deal for the global economy, and a billion dollar deal for the UK. By cutting trade bureaucracy the deal could reduce advanced economies’ cost for doing business internationally by 10%.
And, significantly, it will help SMEs, which account for almost half of private sector employment in the UK, to become exporters.
It will cut costs for bigger companies as well that is for sure — but multinationals are geared up to deal with the complexities of breaking into new markets.
SMEs don’t have that capacity. This deal will lower the barriers that SMEs face, helping them to export and access new markets — therefore helping them to grow and create even more jobs.
And the evidence shows that export-focused jobs are generally higher quality jobs — and the wages clearly have a premium over wages in other areas.
It is an interesting time in the global debate on trade.
Bali has put the spotlight back onto the WTO, but there is still a lot of focus — in the government and in the private sector — on the large regional trade initiatives which are currently being pursued, including the Transatlantic Trade and Investment Partnership between the EU and the US.
I think this approach is borne out of a clear understanding that the different tracks — regional, plurilateral and multilateral — are not mutually exclusive. They do exist together, they can exist together and in fact they complement each other.
The 1947 General Agreement on Tariffs and Trade itself was effectively a multilateralisation of the network of previous reciprocal trade agreements that existed at the time.
The multilateral system grew out of these other initiatives — and it has always allowed for new ones. Both the GATT and now the WTO have specific rules providing scope for such agreements.
In my view the current work that is going on at the plurilateral and regional level is positive and welcome. Those initiatives have a clear role to play. These blocks help to build the edifice of global trade rules and trade liberalization.
But they must coexist with the multilateral system — not only because there are some issues that you cannot negotiate in a non-multilateral environment but also because of the geographic coverage. The most dynamic areas of the world economy for example are outside these regional agreements.
In terms of the substance, the Trade Facilitation agreement in the Bali package, for example, was successful in the WTO because it simply makes no sense to adopt regulations to streamline customs bilaterally — if do it for one country, you do it for everybody.
Similarly financial regulations or telecoms regulations can’t be truly liberalized for just one player. There may be minor things that you can do but it is clearly much better to negotiate services trade-offs globally in the WTO.
Other examples include farming subsidies or fisheries subsides — they cannot be tackled in bilateral deals. Another example is disciplines on trade remedies like anti-dumping or countervailing duties — you cannot negotiate them bilaterally.
The simple fact is that the major global challenges for trade can only be addressed globally; can only be addressed multilaterally.
And I think this has been quite well-recognised.
Since Bali I’ve been travelling around the world to build on the momentum that the deal created — and ensure that the WTO can deliver even more in the future. In recent weeks I visited the US and talked to President Obama. In the EU I talked to Presidents Barroso and Van Rompuy. I talked to President Dilma in Brazil, President Mujica in Uruguay, and many other political leaders both north and south.
And everywhere I go I sense that there is very strong support for the multilateral system and the WTO
This afternoon I will be talking to the government here in the UK to discuss precisely how we can continue to advance the WTO agenda.
So as we talk about the WTO agenda, where are we today? What are we doing now? How do things stand after Bali?
I think in Geneva there is a tangible feeling of momentum. There is new energy and purpose, that’s clear in the conversations we’re having. Bali has noticeably changed the game.
We now have two very significant tasks before us in Geneva.
First and foremost, we have to harvest the benefits of Bali and the way to do it is by fully implementing the decisions and agreements reached at that Ministerial Conference.
Second, as was instructed by ministers in Bali, we must prepare, by December, a clearly defined work program to conclude, once and for all, the Doha Development Agenda.
And there are some really important issues on the table at this point in time.
I am increasingly of the view that whichever approach we take, we will need to tackle the really tough areas upfront: agriculture, non-agricultural market access (or industrial goods), and services. These are the toughest areas simply because they are where the big outcomes will come from.
Negotiations have already gone on for too long. These three issues have not been discussed in nearly 6 years. So now it is time to bring them back into play. We cannot avoid them anymore — we have to look at them. If we make progress there, everything else falls into place, I have no doubt. If we don’t make progress there, if there is progress elsewhere it is going to be very, very limited.
I’m not suggesting that we should increase or decrease our ambition for the Doha agenda — what we must have is a new approach to deliver results. In many ways this is a new Doha round.
Our aim now should be nothing less than to complete the round — and to do it quickly.
Just yesterday I addressed the whole WTO membership and signaled that we need a new phase in our deliberations. We are moving into a more purposeful stage at this point in time — focused not only on how we feel about what went wrong but also on proposing and testing new ideas and solutions.
I was very pleased with the response from members.
But that’s enough for now about the process in Geneva.
We should take a moment to remember why all these things matter.
I have a feeling that I am speaking to the converted here. I often argue that trade is a force for growth and development — but I don’t have to say that to you. Or that it stimulates innovation and competitiveness, but I don’t have to say that to you. Or that it supports the creation of good quality jobs, and access to the most dynamic centres of growth around the world; that it lowers prices and the cost of living, brings in new products, and improves the quality of people’s lives.
Of course, the UK knows all of that.
You rightly have a reputation as a great trading nation — and as a world-leader in trade finance.
But it’s worth looking at how this came to be the case.
If you look at the history then you see the importance of the private sector in some of the crucial moments.
In the 1820s, when the protectionist attitudes of the 17th century Navigation Laws were being challenged, merchants and manufacturers were at the forefront of the debate, calling for a different approach.
Merchants in the big trading cities of London, Manchester and Glasgow petitioned the House of Commons for the abolition of all duties — starting a process which ended up, as you recall, with the repealing of the Navigation Laws and the Corn Laws. And this led to the UK’s longstanding commitment to free trade.
I learned on the way here that it is currently Export Week in the UK so I am very happy to be here at this moment and to be marking this week with you.
The support of Her Majesty’s Government for our work in Geneva is crucial — and we believe that, in turn, our work at the WTO is also crucial for the UK government’s efforts in promoting growth at home and promoting development and multilateralism globally.
But, in fulfilling this mission this year we are going to need advocates in business.
As I said at the outset, the combined voices of business leaders in the UK, and around the world, were pivotal to our success in Bali.
So, I urge you to keep your voices raised in support.
Bali delivered a great deal in itself — but even more significantly it created an opportunity to deliver even bigger gains in the future — an opportunity which we now have to seize.
Your support will be even more crucial in this next stage.
Thank you for listening.