World Trade    WT/MIN(96)/ST/6

    9 December 1996



    Original: English


Singapore, 9-13 December 1996


Statement by Mr. Poul Nielson

Minister for Development Cooperation

    I would like to thank you and the Government of Singapore for hosting this historical Conference. You have offered us a privileged opportunity to observe the admirable progress achieved by the people of Singapore, and to enjoy the warm Singapore hospitality as well as your perfect arrangements for this important Ministerial Conference.

    It is of the utmost importance that the Singapore Conference send a clear signal that the WTO has taken off with success. Implementation of the Uruguay Round result is proceeding. The Singapore Conference will endorse a forward-looking work programme. The strengthened dispute settlement system has turned out to be - as we had hoped - a strong asset for international trade.

    Denmark is among the staunchest supporters of liberalization in the framework of the multilateral trading system. We are a small and open economy. Danish exporters and importers are active in all regions of the globe. We trade across a wide range of goods, services and intellectual property rights. For many countries foreign trade corresponds to around 10 per cent of GNP. For Denmark the figure is as high as 35 per cent. The importance which Denmark attaches to trade liberalization is a reflection of these facts.

    It is also because of these facts that we push for the WTO to be forward-looking. The world is changing, and the issues facing international trade are changing as a result. In the interest of trade liberalization the WTO has to keep up with these changes.

    I am going to highlight two topics on which the WTO must focus in the future in order to maintain its pivotal role.

    First: trade and developing countries. It is of great satisfaction to my Government to witness the large number of developing countries which have recently acceded to or are currently in the process of acceding to the WTO. Full participation in the multilateral trading system - including the special and differential treatment which the WTO offers - is a fundamental tool for economic development. But as we know, integration of developing countries into the system is not easy (for which there is a variety of reasons).

    My point is that the issue must be at the centre of the WTO's attention. I pledge my Government's strong support for efforts aiming in this direction. This Conference will take a step along that path. But much remains to be done. Market access and technical assistance are among the instruments at our disposal. Denmark advocates a substantial use of both. We are in favour of zero tariff on industrial goods from LLDC's, and we are among those who are ready to go further. Denmark also supports better market access in agriculture and fisheries. A year ago my Government offered to WTO Secretariat financial support in its endeavours in the field of technical assistance. I take this opportunity to renew our offer.

    The second topic I want to highlight is the consumer. The consumer is becoming increasingly powerful in international trade. That trend will continue. Let me give you an example: earlier this year a major European company was interested in investing in a factory in a different part of the world to supply that geographic region. A decision on the location of the factory had been made. The company had to change its mind. Why? Because consumers in Europe threatened a boycott of the products of the company. Consumers felt that the country which was to be the export base for the region did not respect fundamental labour rights. The consumer forced the company to make the investment in a different country.

    If the consumer feels that the WTO takes no interest in his main concerns, the WTO and the aim of liberalization of trade will lose public support. That is a key reason why Denmark - one of the staunchest supporters of the multilateral trading system - urges the WTO to move ahead on environment and fundamental labour rights.

    The outcome of two years work in the WTO on trade and environment is disappointing. If the WTO is to maintain its credibility it will have to make an appropriate response to a public concern of the highest priority.

    Work will continue on the basis of the result which has been achieved. Denmark will continue to give trade and environment our fullest attention. The EU proposal on Multilateral Environmental Agreements will be a priority topic. The time has come to expand discussion of environmental principles, as for instance the precautionary principle.

    I want to emphasize that restricting trade flows is not normally the most efficient means to protect the environment. Response number one is and remains national environmental policies. But in certain cases trade will have to make a contribution.

    Trade liberalization is a necessary condition for promoting economic growth and better living standards. In this way the WTO contributes to promoting fundamental labour rights. However, for the reasons I have already mentioned the WTO has to do more. It is my conviction that the WTO should set up a working party to analyse the link between trade and fundamental labour rights. I would emphasize that as a nation dependent on free trade we would refuse any discussion of comparative advantages. For the same reason we would reject the notion of sanctions.

    What I have said about environment and fundamental labour rights also applies to investment and competition:

    For the WTO to remain the leading force in trade liberalization the organization must deal with the issues confronting international trade. An operational response is required in relation to investment and competition.

    The aim of our endeavours is global trade liberalization. The vehicle for this, first and foremost, is the WTO. A key role in the WTO is that any regional trading arrangement must be WTO-consistent. An arrangement which is not complementary to and supportive of the multilateral trading system is an obstacle to global trade liberalization. Denmark is, of course, also in this area in favour of giving special treatment to developing countries.

    One of the greatest strides forward made in the Uruguay Round was the inclusion into the multilateral trading system of trade in services. A key task for future WTO negotiations will be further liberalization in this field. With the rapidly growing importance to world trade of the services sector our ambitions must be high. An agreement in any one sector which does not entail a real liberalization defies the purpose. We must give full attention to the ongoing negotiations on basic telecommunications and I believe that we will be successful. Likewise we must give full attention to the upcoming negotiations on financial services.

    Another major achievement of the Uruguay Round was laying the foundations for future liberalization of international trade in agricultural products. Being a major producer and trader in this sector Denmark is ready for substantial improvements.

    The traditional area of work for the multilateral trading system - market access of goods - is an undisputed success story. But work remains to be done. In the area of Information Technology more must be done in order to keep pace with the new technologies. An agreement to bind tariffs on information technology equipment at zero would be a major step, beneficial to all parties - exporters and importers. Such an agreement would demonstrate the ability of the WTO to keep pace with the information society.

    The number of members of the World Trade Organization is likely to increase further. Denmark welcomes this development. In particular we are pleased to note the interest expressed by developing countries and countries in transition. We look forward to seeing close neighbours, including the Baltic States, in the membership as well as partners which are close in trading terms albeit a little further away geographically speaking.

    Let me close by joining those who have expressed the hope that the Singapore Ministerial Conference will mark the continuation of 50 years of multilateral trade liberalization in a spirit of openness to the challenges ahead of us. Better lives for billions of people are in the balance.