WTO breaks stale­mate to agree in his­toric trade deal

The Star Early Edition - - BUSINESS REPORT - Tom Miles

THE WORLD Trade Or­gan­i­sa­tion (WTO) adopted the first world­wide trade re­form in its his­tory yes­ter­day, after years of stale­mate, months of dead­lock and a fi­nal day’s de­lay fol­low­ing an eleventh-hour ob­jec­tion.

The agree­ment means the WTO will in­tro­duce new stan­dards for cus­toms checks and bor­der pro­ce­dures. Pro­po­nents say stream­lin­ing the flow of trade will add as much as $1 tril­lion (R11 tril­lion) and 21 mil­lion jobs to the world econ­omy.

“We have put our ne­go­ti­a­tions back on track,” WTO di­rec­tor-gen­eral Roberto Azevedo told a news con­fer­ence held after trade diplo­mats applauded the end of their 19-year wait for a deal.

How­ever, he said WTO mem­bers needed to find a way to speed up ne­go­ti­a­tions in the fu­ture. “We can­not wait an- other 17 or 18 years to de­liver again,” he said.

US trade rep­re­sen­ta­tive Michael Fro­man said the agree­ment could sub­stan­tially re­duce trans­ac­tion times and costs, and would un­lock new op­por­tu­ni­ties for both rich and poor coun­tries.

He said it was a “par­tic­u­larly im­por­tant win for small and medium-sized busi­nesses in all coun­tries”.

Still, the agree­ment is just a frac­tion of the orig­i­nal Doha Round of trade talks be­gun in 2001, which even­tu­ally proved im­pos­si­ble to agree on. The WTO cut back its am­bi­tions and aimed for a much smaller deal.

Even that was blocked by a four-month stand-off caused by In­dia, which had ve­toed adop­tion of the re­form pack­age as the orig­i­nal dead­line passed at mid­night on July 31.

In­dia de­manded more at­ten­tion be given to its plans to stock­pile sub­sidised food, in breach of the WTO’s usual rules. A com­pro­mise on word­ing reached by the US and In­dian gov­ern­ments broke the dead­lock. In­dia’s WTO am­bas­sador An­jali Prasad de­clined com­ment.

The re­form pack­age adopted yes­ter­day was agreed at a WTO meet­ing in Bali in De­cem­ber last year. Its pas­sage is widely seen as open­ing up progress to­wards fur­ther global ne­go­ti­a­tions, the con­tent of which is due be laid down by July 2015.

That should re­as­sure smaller na­tions in the 160-mem­ber WTO. Many had feared In­dia’s tough stance would prompt the US and the EU to turn their backs on the WTO and con­cen­trate on smaller trad­ing clubs in­stead, end­ing hopes of trade re­forms ben­e­fit­ing all.

Euro­pean trade com­mis­sioner Ce­cilia Malm­strom said the agree­ment had con­firmed the WTO’s role at the cen­tre of in­ter­na­tional trade pol­icy.

“In short: the WTO is back in business.”

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