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The London G20 Summit is an opportunity to tackle urgent issues related
to the impact of the global crisis on international trade and the multilateral
trade system. On the trade front, the Summit should show that G20 countries
are prepared to avoid protectionist measures and practices, and that they
will continue working together to strengthen the WTO system. But at the
same time, it is important for G20 participants at the Summit to recognize
that effective cooperation on trade-related issues can only be achieved
through the collective capacity and mobilization of as many countries
as possible. As is true for the EU members of the G20, it should be assumed
that other participating emerging countries are, at least to some degree,
expressing points of view that stem from consultations with non-participating
developing countries from the same region. This would contribute to the
international legitimacy of the G20 and strengthen its capacity to impact
global realities.
What then are developing countries’ views on how global governance
goals support their development interests? Likewise, what are the most
critical challenges related to their participation in the multilateral
trade system? From a developing country perspective, some of the more
urgent challenges are:
- To improve access to reliable and up-to-date diagnoses on the evolution
of the global economic competition and its impact on actual or potential
competitive advantages;
- To mobilize the energies and capacities of developing country societies
to compete at the global level and to attract productive investments
from as many national and foreign sources as possible;
- To establish national strategies based on particular local conditions
that help developing countries to harness and benefit from the opportunities
presented by global markets and the multilateral trading system;
- To promote at the regional and sub-regional level, flexible, sustainable,
and WTO-consistent economic integration processes. In this regard, developing
countries need to contribute by promoting productive investments, enabling
better access to technical progress, increasing their capacity to negotiate
at the international level, and strengthening their influence on the
definition of global governance goals and mechanisms.
Reforming the governance of global trade and the multilateral trading
system will be a long term and non-lineal process. It will depend largely
on the future power distribution among nations and it will take some time
to stabilize. In the best scenario, the London G20 Summit could be a step
forward in achieving a more development-friendly multilateral trading
system. Four immediate steps of particular interest to developing countries
are:
- To obtain concrete and certain compromises regarding new market access
to developed nations;
- To reduce the negative impact of economic and trade policies (i.e.
agriculture subsidies) that distort global trade;
- To promote greater flexibility in WTO disciplines to allow developing
countries with long term national development strategies to temporarily
adopt limited emergency trade measures (along the lines of the opt-out
schemes suggested by Dani Rodrik in his 2008 book “One Economics
- Many Recipes”); and
- To promote an Aid for Trade strategy-wherein aid is understood as
a systemic upgrade of developing countries’ ability to compete
at the global level-with significant financial resources, which could
be managed through a consortium with the participation of the main development
oriented agencies (i.e. the UN Industrial Development Organization (UNIDO),
the United Nations Conference on Trade and Development (UNCTAD), the
International Trade Centre (ITC), and multilateral development organizations)
under the leadership of the World Trade Organization (WTO).
Emerging countries participating at the London G20 Summit have an important
opportunity. They should aim to obtain a strong political commitment to
strengthening the WTO as a development-sensitive and rules-oriented multilateral
global trading system. Top priorities should include
- To establish a concrete deadline for concluding the Doha Round (i.e.
December 2009) and simultaneously launching a process that will enable
member countries to engage in a new action plan and roadmap to advance
a development-oriented global trade expansion;
- To convene a WTO Ministerial Conference in Geneva in December 2009,
with the intent of launching a new process for the negotiation of multilateral
trade agreements - not necessarily a new Round - with a strong development
orientation, including necessary institutional reforms of the global
trading system. This Ministerial Conference should be prepared through
regional meetings and parallel multi stakeholder seminars, with strong
participation from civil society representatives. This would also provide
an opportunity for potential WTO reforms, including innovative negotiating
methodologies (critical mass, variable geometry, multiple-speed formulas,
among others) can be explored and discussed previous to the Ministerial
Conference; and
- To stimulate and support the monitoring capacity of the WTO Secretariat
regarding those trade policies, measures, and practices that could produce
negative effects on the expansion of global trade (i.e. through protectionism).
Eventually this capacity could be strengthened through a non-governmental
online database, which could be freely created and edited with the active
participation of all interested parties (a kind of Wiki-trade surveillance
facility).
Some specific institutional reforms could contribute to strengthening
the multilateral trading system and the WTO. Both the G20 Summits and
the 2009 WTO Ministerial Conference could function as a space to launch
a debate that could later lead to concrete action toward those reforms.
Such reforms could include:
- To strengthen the WTO’s capacity to evaluate a wide-range of
trade preferential agreements as well as protectionist and trade-distorting
measures and practices (including those originated at the business sector).
The creation of a body composed of high level independent experts, along
the lines of the approach taken for the WTO’s dispute settlement
system, could be explored. A kind of global trade and development ombudsman
within the WTO structure could also be considered. The ombudsman could
be an independent official charged with the investigation of complaints
by citizens of Member countries that eventually could lead to non-binding
recommendations.
- To promote the capacity of the WTO Secretarit to undertake evaluations
and make proposals regarding the evolution of global trade and its relation
to development goals (one option, for instance could be the publication
of joint reports with other relevant development international institutions
and agencies);
- To develop mechanisms - jointly with other relevant international
development institutions and agencies - that enhance the capacity of
interested least developed countries (LDCs) to take full advantage of
all the instruments provided by the multilateral global trading system,
particularly of its dispute settlement system. Such mechanisms could,
for example, include trilateral cooperation programs with the participation
of emerging economies in the same region as the beneficiary country.
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