Developing countries work to lower trade barriers

Ever since President Clinton left office the US has lost its leadership role in the movement towards liberalized global trade.  Yes American politicians publicly talk about their support for free trade, but for the last nine years American (and European) politicians have thrown their support behind narrow regional interests rather than behind the interests of the nation (or continent) at large.  Agriculture and manufacturing lobbies in developed countries especially have successfully opposed trade agreements which would give all consumers more choice and bring much needed capital to developing countries.

So I am happy to see a group of developing countries buck the developed world and work towards liberalizing trade without us.  According to Reuters:

As the World Trade Organisation’s Doha round stumbles into its ninth year with no end in sight, a group of 22 developing countries are poised to clinch their own deal to cut tariffs and boost trade among themselves.

The deal to expand the General System of Trade Preferences (GSTP) could be announced during the WTO’s own three-day ministerial conference starting Nov. 30, when trade ministers from most of its 153 members will be in Geneva.

The 22-member GSTP includes heavyweights such as Brazil, India and South Korea, as well as some of the poorest countries including North Korea and Zimbabwe. China and South Africa are not involved.

The GSTP is one of the few forums where both North and South Korea sit and negotiate together.

Trade officials and diplomats said the likely deal would involve countries cutting their actual, or “applied”, tariffs by 20 percent or more, on 70 percent of goods.

This outline deal, or formula, known in trade jargon as “modalities”, would then be implemented in the coming months in detailed work applying the tariff to individual products.

Countries could also negotiate deeper cuts with each other that would then be available to the whole group.

A study by the United Nations Conference on Trade and Development (UNCTAD), which is providing technical assistance to the GSTP talks, estimates that a 30 percent cut in tariffs by the 22 countries would boost their exports by $11.7 billion, while a 20 percent cut would increase them by $7.7 billion.

Read the full story below:
Developing countries ready tariff deal without WTO


Comments are closed.