Friday, 28 May 2010
Aurelie Walker is the Trade Policy Advisor at Fairtrade Foundation
In his interview with the Today programme on Radio 4 yesterday morning David Cameron‘s fleeting reference to concluding the Doha Round of trade negotiations in the World Trade Organisation (WTO) as a stimulus to growth in the Eurozone roused little excitement in the interviewer. However, for those working to cushion developing countries from the negative effects of trade liberalisation, ears pricked up.
Cameron rightly pointed out concluding the Round is a complicated matter. He is clearly well briefed on the intricacies of commercial diplomacy. The intricacies of international development may be equally as difficult to overcome.
The Development Round has stalled because of the disparate definitions of ‘development’ among the WTO membership. The G8, emerging economies, least developed countries and small island states rarely see eye to eye on this – the central objective of the nine-year-old round of trade negotiations. Without a common consensus on development, the Development Round cannot be revived, let alone concluded. The Treasury perspective expressed in the interview, that concluding the round would be a stimulus to growth that ‘does not cost anything’ and that ‘doesn’t put up the budget deficit’ does not present the full picture.Questions of migration, conflict and poverty reduction are inextricably linked to a country’s economic and trade policies. This is recognised by the new ‘post-Lisbon’ EU in its revamped commitment to ‘Policy Coherence for Development’. For some reason, the trade experts are the last to concede what every other social scientist has acknowledged; that unfettered trade liberalisation is not a synonym for ‘development’. In fact, the more the trade policy tools available to developing countries to manage their economy are restricted, the greater the income inequalities that will arise from any growth; as attested by India’s, Brazil’s, as well as Sub-Saharan Africa’s experience. If the European position in the Development Round is not development oriented and leads to increased inequality and pushes the marginalised further into poverty - at home and abroad- it will be paid for in other ways as the consequences unfurl - Greece and Jamaica are the most recent tragic examples. The Treasury should be aware that pushing trade liberalisation as a stimulus to growth without a consensus on development in the WTO can indeed be very costly.
Posted by Fairtrade Foundation at 17:15