Trade ministers must keep their eye on the prize

Date: 25/11/1999

Amid the inevitable squabbling in the run-up to the meeting in Seattle next week which is due to launch the next round of global trade talks, members of the World Trade Organisation should not lose sight of the prize which is on offer if they can set aside their differences.

The EU estimates that a comprehensive deal in line with its vision of a broad agenda could boost global wealth by a massive €380 billion, with agreement on competition and investment rules alone generating €150 billion. European industry is supporting the Union's bid for a wide-ranging agenda, arguing that globalisation is a trend which cannot be stopped and that what is needed are rules to ensure that everyone benefits from it and that any potential disruptive effects are minimised.

It was always likely that the arguments over the agenda for the next round of talks would not be settled until the crunch came in Seattle, for two reasons. Firstly, because there is only so much progress which can be made in talks between officials and an injection of high-level politics is vital when the time comes to make painful concessions. Secondly, seasoned negotiators know that maintaining a hardline in the run up to talks and refusing to give any ground is the best way to extract maximum concessions from your opponents when the moment of truth arrives. That is why the doom-laden warnings from Trade Commissioner Pascal Lamy and others this week that ministers might leave the Seattle meeting empty-handed should not be taken too seriously at this stage.

But with so much at stake, world leaders cannot afford to lose sight of the goal. Give and take at next week's meeting will be vital to ensure a successful outcome, particularly when it comes to addressing developing countries' concerns about launching a new round of talks while they are still trying to implement elements of the package agreed at the end of the last one.

The onus will be on US President Bill Clinton, in particular, to demonstrate a willingness to compromise, amid suspicions that Washington's approach is being dictated more by the administration's need to play tough in the run-up to next year's presidential elections than by genuine concerns about the impact of greater liberalisation in certain key sectors. For as Lamy warned this week, opposition to globalisation and further trade liberalisation will increase if the WTO does not tackle "new issues" such as minimum labour standards, food safety and the environmental impact of trade, or if the momentum is lost because one of the WTO's key players takes a short-term view.