By Charlotte Denny, Larry Elliott and David Munk
GuardianSeptember 16, 2003
The European Union yesterday urged a radical overhaul of the World Trade Organisation after the embarrassing collapse of trade liberalisation talks for the second time in four years. With Washington threatening to extend its "go it alone" strategy in global politics to trade deals, Pascal Lamy, Europe's trade commissioner said that although the break down in Cancun, Mexico, did not mean the negotiating round was dead, it was in need of "intensive care".
Warning that there was now a grave risk of the negotiations overrunning their deadline of January 1 2005, Mr Lamy said the WTO was a medieval organisation in urgent need of reform. "The procedures and rules of this organisation have not supported the weight of the task," he said. "There is no way to structure and steer discussion among 146 members in a manner conducive to consensus. The decision-making needs to be revamped. The EU will continue to work in this direction, within the WTO."
The risk of the US, the world's largest economy, pursuing a unilateral approach to trade deals was underlined by its trade representative, Robert Zoellick. "The United States has an agenda on multiple fronts," he said. "We are going to keep opening markets one way or another. People know the formula. It is on the table. People will have to decide whether they want to engage in it. We will always be there to engage in it, but we are not waiting forever. We are going to move elsewhere."
As the WTO began to assess the damage caused by the impasse at the talks in Mexico, its director general, Supachai Panitchpakdi, called on its 146 members to put aside national interest for the sake of the fragile global trading system. "I have said, time and again, that in order to make this a successful effort we need to do it collectively," he said. "We need to be flexible, be ready to give and take and from time to time to rise above our national interest and look at the larger multilateral cause to give us returns many times over."
Brazil, the leader of a powerful group of 21 developing countries which faced down the EU and US with its own demands for radical reform of western farm subsidies, insisted that the alliance would return to the negotiating table in a constructive spirit. "We will not abandon the WTO," the Brazilian foreign minister, Celso Amorim, said. "This is not a failure of the WTO."
African states, which make up some of the WTO's smallest members, prompted the breakdown when they refused to accept Mr Lamy's last-minute concession to drop the controversial new issues of investment and competition from the talks altogether. Led by Botswana, they insisted that the other two new issues - cutting red tape on trade and clearer rules on how governments buy goods and services - be removed as well. "We have said we don't want to negotiate on these issues," said Jayen Krishna Cutteree, the Mauritius trade minister, speaking on behalf of the African Union.
Although it was the refusal of African countries to bow to Europe's demand for talks which forced Mexico's foreign minister, Luis Ernesto Derbez, to declare the talks irretrievably deadlocked, Mr Zoellick lashed out at the Group of 21. "If large members of the WTO want to continue doing negotiations through tactical rhetoric, as opposed to negotiations, I think it is going to have a hard time reaching results," he said. "I hope this will be salutory. Their tactics and their logic didn't produce anything for them."
He added: "One of the problems we ran into was that a number of countries just thought they could make any points they suggested, argue and not offer a view. Now they are going to face the full reality when that strategy comes home with nothing."
More Information on the World Trade Organization Cancun Ministerial 2003
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