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Ladies and Gentlemen,
Pleasure to be here, and thank you for the
opportunity to speak to this symposium, for which I applaud Mike
Moore's initiative. I would very much like to stay for the whole
thing, but I am being despatched with indecent haste to Brazil,
though not on this occasion to Puerto Allegre.
As I was preparing to come here and speak to the
participants in this forum, I looked up some facts on the history of
the relationship between the WTO and NGOs. For some, it is an
institutional novelty borne out of international negotiations
themselves, what Sylvia Ostry has described with her usual wit as
"conference-building measures". Indeed the way to survive
at international conferences is to use Sylvia’s best lines before
she gets anywhere near the platform. But in fact, as Sylvia
recognises, NGOs and the world trading body go back a long way. Some
of you may recall the now defunct plans existed for International
Trade Organisation, which contained a section about the involvement
of NGOs – almost 40 years before the WTO was launched.
And here we are, in the early years of the new
Millennium, trying to find the right way to tackle new questions,
such as environmental regulation and consumer protection. One thing
is now clear, however, and that is that the so-called new issues are
not just deeply embedded in the institutional infrastructure of an
economy, but also reflect the collective preferences and moral
choices of society. Take the whole debate about trade and core
labour standards, for instance: public support for the trading
system is becoming frayed. We have to respond constructively to
those who fear that core labour standards are being undermined, and
to those who want reassurance that they are being properly applied.
These issues cannot, and will not, be left to
meetings behind closed doors. We need a broad public debate about
the way in which the trading system should develop, and NGOs
obviously have a contribution to make to this debate. So, the
question is not whether there should be a relationship
between the WTO and NGOs, as in this excellent symposium, but how
this relationship should be structured.
In terms of future relations between the WTO, its
members and the NGOs, we need to recognise that some NGOs
want more transparency, participation, and influence on
decision-making than some WTO members are willing to accept.
But I think we should be able to move forward on the basis of two
essentials:
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Responsibility. Decisions are made by governments, and
responsibility for those decisions rests there, with the
peoples' representatives. I have said this before: NGOs should
have a voice – but not a vote.
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Openness. We must take active steps to look for processes and
approaches which enable NGOs to contribute wherever useful.
These considerations are not new, and indeed the
EU has put forward ideas along these lines here in Geneva. But these
two points allow us to focus on the real questions of WTO-NGO
relations. In doing so, remember that transparency does not start
and finish with NGOs and the WTO. There are two other points of
equal bearing:
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First, all governments need to assure that transparency also
starts, like they used to say about charity, at home. Much
better, in fact, to ensure that all parts of society have the
chance to put their oar in at the time when each WTO member
formulates its negotiating position.
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Second, we need to a closer involvement of Parliaments in WTO
matters, both in capitals and in Geneva.
Without the first, the real value of WTO
transparency will be limited. Without the second, legitimacy will
suffer. So how is the EU doing ? Not badly, I'd say: on the
first point, the Commission now has established a substantive
dialogue with civil society at all levels, as indeed have most of
our member states; and we have begun to include systematically / in
bilateral agreements / explicit provisions for the participation of
non-state actors. On the second point, the involvement of
parliaments, the recent meetings on trade policy and WTO affairs
held by the European Parliament in Brussels and by the
Inter-Parliamentary Union here in Geneva are a good basis for future
work.
And what is this future work about? To sum it up
in one phrase, I'd say: assuring that globalisation is harnessed for
the benefit of all. And as you all know, the EU thinks that the best
vehicle for achieving this is a new round of global trade
negotiations. No surprise, when everyone knows that we have been
working very hard on this. So indulge me if I spend a few moments on
why we think a round is needed – for all the members and for the
trading system.
First, as Kofi Annan said to the recent UN
conference in Brussels, a WTO development round, improving
market access for developing countries, will be an important element
in LDC economic growth, and in the reduction of poverty. That is the
ultimate acid test for trade policy. We are certainly prepared in
the future to improve access to the European market for the products
of developing countries as part of our contribution to their growth,
employment, sustainability and stability. In any case, you will have
seen what we have done in relation to the Least Developed Countries,
called Everything But Arms, to provide for quota free, duty free
access to the European market. We are of course extremely proud of
this initiative, but I don't think I need to say any more about that
this morning.
But market access is necessary but not
sufficient. Globalisation has changed the nature of trade and
trade policy. We must update and strengthen the WTO rulebook to
manage the interface between trade and other policy areas such as
health, consumer safety and environment. If not, we risk conflict
between trade and other policies. Trade rules must not override the
other concerns of society. The important point here is to ensure
that compatibility.
And second, we need to help the WTO find its
proper role as an organ of international economic governance.
What do I mean by this? I mean because transborder issues by
definition loom larger, national governments are increasingly
struggling to find solutions through action at the national level.
This is true not only of areas like environment but also issues such
as access to health care, restrictive business practices, monetary
and investment policies, transnational crime, and so on. Co-ordinated
solutions at the international level – including multilaterally
agreed rules in the WTO – will be necessary if government, and not
pure market forces, are to set the path of evolution of the world
economy.
That is why the Commission has consistently tried
to ensure that its agenda for the WTO is both supportive of
development and properly harnesses globalisation. That is why
we oppose proposals for a Round limited to market access only.
A market access round would also face strong
resistance from parts of civil society who rightly want the WTO to
take measures to support sustainable development, the environment,
health and safety and other areas of trade overlap. A Round to
reduce the tariff on widgets might have worked twenty years ago but
it won't work now. Trade policy has changed, and we have to change
with it.
Let me focus for a moment on the rule making
aspect of the WTO and what we envisage in a new round. Rules are
needed first of all to guarantee market access of course, and to
guarantee that all members – and particularly the smaller ones –
have access that is not frustrated by other means. That is why we
have been ready and indeed openly supportive of those who have
suggested to strengthen existing WTO rules, in areas like anti
dumping, TBT, non-tariff barriers, subsidies and so on, to increase
transparency and predictability, to ensure non-discrimination, and
to reduce the threat of protectionism.
And we have a particular interest against this
background to clarify the rules on trade and environment, and
consumer health and safety, so as to put beyond all doubt any
misconceptions that the WTO is, or risks being, in the future,
inimical to environmental policies or to legitimate consumer safety
goals. Of course, we need to avoid in negotiations any outcome which
leads to disguised or even blatant protectionism, but if we fail to
negotiate, we will simply invite more criticism of the WTO, leave
environmental and trade policy makers without guidance, and business
without predictability. And we would simply be confirming is that
WTO panels, rather than elected governments, make the rules. That is
the real test, in terms of governance: whether we leave policy
making to the sausage-making machine called the dispute settlement
mechanism, or whether governments take the responsibility to make
the sausage themselves.
In addition to the strengthening of existing
rules, which is supported by most WTO members as a part of the
agenda after Doha, we and others have also proposed the extension of
WTO rules into new areas, notably investment, competition,
and trade facilitation.
Investment was at least until recently a
controversial issue especially with the NGO community and even more
some developing countries who were concerned that a wholesale
opening of their markets to speculative capital movements could
swamp domestic development policies, or give too many rights to
companies at the expense of governments. I think that recent
discussion shows conclusively that this is not, must not and will
not be the case. Our idea is to confine negotiations to commitments
based on a positive list of sectors, the so-called bottom-up
approach, giving all members control over whether and when to allow
foreign investment while preserving their right to regulate. Many
developing countries of course need foreign direct investment to
help their growth, employment, and transfer of capital and
technology, and for them, some basic rules in the WTO will, by
increasing the predictability for potential investors, lead to more
investment with all the benefits it can bring.
Competition is if anything even more
important from the systemic viewpoint. It’s about development as
much as trade. In cases of under-development, you will always find
monopoly rents and cartels, and untransparent procurement regimes
which are nests of corruption. But even in trade terms, a level
playing field in competition is every bit as pertinent as a tariff
cut at the border. For what’s the point in a tariff cut if you can’t
have access to distribution outlets or transport networks? If your
domestic competitors have stitched up the market? Competition issues
have become international issues because anti competitive practices
are increasingly international in nature. So it is logical that the
WTO to establish a basis on which to tackle them. The WTO must
demonstrate that is not, as some of its critics claim, the apologist
for the unacceptable face of global capitalism, and that it can help
to ensure that the benefits of trade liberalisation are more fairly
shared.
We of course recognise the concerns that have
been voiced, notably by developing countries, about the competition
and the investment agenda. That is why we have tempered our
ambition: in both cases we are looking only for a basic framework of
rules. Indeed, we are also offering an opt-out card to those
countries who are concerned that these negotiations might balloon
out of their control. This card, expressed in our willingness to
accept, at the end of the day, a plurilateral outcome to
negotiations, is the ultimate insurance policy to these countries
that our objectives are genuinely limited. And that is also why I am
also attracted, frankly, by the views put forward recently by
Ambassador Akram that for competition and investment to be
acceptable, they must be "trade-related",
"necessary", "sufficiently clear" and
"balancing costs and benefits". I for one am willing to
accept the Akram Challenge: I believe our policies do meet
this test, but we need to demonstrate that conclusively.
Finally,
trade facilitation – practical
measures to reduce red tape that will in particular help small
companies to survive and prosper in the international marketplace.
This initiative focuses on practical rules to minimise the costs and
delays caused by import, export and customs procedures, to help
companies compete in the new economy. These barriers are estimated
by UNCTAD as wasting seventy billion dollars a year: dead-weight
costs borne by small companies, who obviously find it harder to
negotiate their way around or through inefficient and bureaucratic
procedures.
But simple procedures do not only help traders.
They also help governments to save money and to increase their
customs revenues. Many developing countries have gained enormously
– in terms of revenue collection, better administration and better
protection of society from illegal or dangerous goods – by
streamlining and modernising customs. If we add a decent technical
assistance package to help LDCs set up these systems, and I think
the benefits of negotiations in this area are obvious.
So that is our rule making agenda. Far from
onerous and ambitious, I hope you agree that is the very minimum
that WTO should be doing to address questions being thrown up by the
process of globalisation. The fact is that the EU and the US, as Bob
Zoellick has said recently, could get along without a Round. I am
less sure about developing countries, particularly the poorest. My
fear is that without a Round, the world trade system will leave them
further behind.
Before concluding, let me say that I think there
is a link between this agenda for a new round and what I said
earlier in my remarks about the relationship between WTO and civil
society. Let’s look at the substance. Not just market
access, but new and better rules to govern international trade. I
hope that is an aim that we all share: whether we want the WTO to
take better care of its developing country members, or we want to
secure a more level playing field in the global marketplace; whether
we want to make sure that decisions are taken in greater
transparency and with more involvement of all actors; or whether we
want that assistance to be provided to those who do not currently
benefit enough from the world trading system. Whatever our immediate
objectives, the common goal must be to make the WTO work better for
all members, and for all their citizens.
My contention is that this is the best case for a
New Round of negotiations, because any of us here would be hard
pressed to argue conclusively that the current rules all work in
this direction. Of course, I’m happy to accept that views may
differ on how this is to be achieved: that’s after all what
negotiations are for. On that, I think we have shown that the EU is
ready to listen, and ready to show real flexibility to take account
of the views of others.
But let’s keep one thing in mind: without a
round, it will all be much, much more difficult, for all concerned,
governments, citizens, and NGOs. And difficult for the WTO itself:
Mike, you have said rightly that the WTO may go into hibernation if
we do not launch the Round in Doha. I agree, but it may be worse
than that: sometimes hedgehogs do not survive a long, cold winter.
Thank you. I will have to run to catch a flight,
but of course happy to take questions if I am here when they are
asked !
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