EU, US blamed for failure of trade talks

- Malta favoured negotiations on Singapore issues

By Julian Manduca
The European Union and the United States drove the World Trade Organisation (WTO) talks here to collapse as they refused to give real concessions to a bloc of developing countries, members of civil society have claimed.
The US on its part has ‘blamed’ some unnamed countries for not willing to reach agreement on the so-called ‘Singapore’ issues: investment, competition, transparency in government procurement, and trade facilitation.
Some delegations, notably those from the European Union and Japan, but also Malta, favoured launching negotiations immediately on all these issues. Several developing countries, however, resisted negotiations on the Singapore issues.
In his speech to the WTO delegates Malta’s representative Parliamentary Secretary Edwin Vassallo had come out in support of the Singapore liberalisation: "I would like to emphasise the fact that Malta fully supports negotiations on rules in the areas of investment, competition, trade facilitation and transparency in government procurement.

"We strongly believe that the introduction of rules in these areas would serve to strengthen the overall framework of the international trading system by facilitating the flow of investment, an important generator of economic wealth, as well as creating additional trade opportunities."
His words could not have gone down well with most third world countries.
Following the collapse of the talks Vassallo said: "the meeting was called to a close suddenly when there was insistence that there should be no link between agriculture and other issues including fair trade and the Singapore issues."
However, members of civil society said there was resistance to the new Singapore issues as these intend to liberalise investment, competition government procurement and trade facilitation, which are opposed by most developing countries.
The failure of the meeting touched off celebration among protesters and victory statements from some developing country officials. But US officials said the breakdown would hurt developing countries most by delaying world economic recovery and forestalling reduction of poverty.
The Cancun meeting did not get to discuss agriculture, expected to be a major subject of controversy with developing countries calling for EU and US subsidies to agriculture to be removed. Many agricultural products in the EU and US receive and both are looking to extend their subsidy regime beyond 2003, with most countries in the majority world opposing.
In his address Vassallo told delegates: "May I take this opportunity to emphasise at Malta is a strong believer in the gradual, yet sustained move towards further liberalisation of international trade."
Vassallo explained: "however, I believe that efforts towards further liberalisation of trade should be complemented by the strengthening of global regulations for fair world trading."
Talking about the service industry Vassallo said: "Malta is fully aware of the increasing contribution this sector is providing to global economic activity.
"Being a services-oriented economy itself, Malta supports initiatives to further develop this area whilst at the same time providing countries with every opportunity to implement effective regulation in order to attain their respective domestic socio-economic objectives."
On agriculture Vassallo had this to say: "we believe that any trade liberalisation attempts for this sector should be fair and orderly and should allow scope for the provision of the necessary financial assistance to operators in this field to effectively restructure.
"We also want to reiterate our belief that agriculture has special features given the important contribution which it provides to socio-economic structures and development.
"We therefore continue to support a multifunctional approach to negotiations in this sector, one that takes full consideration of issues such as rural development, environment protection and animal welfare."
Following the breakdown of talks and the closure of the meeting Vassallo said: "the different groups of countries should re-examine their positions and show greater flexibility so that negotiations can continue and an agreement be reached before December 2004, as was mandated at Doha."
US Trade Representative Robert Zoellick, however, expressed doubt that the WTO negotiations launched at Doha, Qatar, in 2001 could be completed on schedule by the end of 2004. He added that the United States would vigorously continue negotiating free trade agreements with willing partners.
Civil Society is less enthusiastic for an agreement and Friends of the Earth International Trade Co-ordinator Ronnie Hall said: "No deal is better than a bad deal. Despite intense pressure from the business lobbies and bullying by the European Union and the US, developing countries have stood their ground. This is a great development for people, small businesses and the protection of the environment."