12th Apr 2024

WTO chief critical of EU's bilateral trade deals

Bilateral trade agreements are likely to detract from the overall aim of a global trade pact with poorer countries losing out, World Trade Organisation chief Pascal Lamy has warned.

"The poorest countries, which are three quarters of the WTO [members], have a less favourable status in a bilateral way," Mr Lamy told a European Parliament group on Tuesday (17 October).

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"Bilateral is not as good quality as multilateral," he said just as the European Commission is beginning a series of bilateral initiatives.

He called on the EU to help revive the Doha Development Round which came unstuck before the summer mainly due to Brussels and Washington disagreeing on domestic aid to farmers.

"The negotiations can resume, mainly because most of the work has already been done," said Mr Lamy sounding an optimistic note. "We need to make these last few steps and I think it is feasible."

EU trade commissioner Peter Mandelson has continuously said that the global trade pact is still his priority but that the bilateral deals Brussels is now overtly pushing for are needed for tackling issues that are not ready for multilateral discussion such as agriculture.

Last week, the EU and India agreed to go ahead next year with negotiations for a bilateral deal and the 25-member bloc is also interested in open trade deals with other countries such as Russia and South Korea, should the Doha round fail.

Mr Lamy explained that bilateral trade agreements could be a "useful supplement" but that it cannot "replace what must be done on a multilateral level."

The WTO chief said that things were happening under the surface on multilateral negotiations but he refused to elaborate.

"Things happening in sub-water will not appear to you for some time," he told journalists and indicated he hoped there will be a political agreement ready for spring 2007.

EU businesses losing out

EU businesses are very keen on a Doha deal and are putting pressure on Mr Mandelson to do what he can to revive the multilateral talks.

European business is annoyed, said Myriam Vander Stichele from Seattle to Brussels - a group working towards a sustainable and accountable EU trade policy.

She explained at a press briefing in Brussels on Monday (16 October) that the US is getting better deals after the two continents had resorted to bilateral deals.

Although she believes the Doha trade round will surface again, she doubts it will lead anywhere. "Developing countries have already said that this is not a deal they can accept, so I can't see how it can go through."

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