Hong Kong trade talks face 'high risk of failure', warns Stiglitz

Click to follow
The Independent Online

Talks on a new deal on world trade are heading for failure unless rich nations make a "symbolic" gesture to show their commitment, a winner of the Nobel prize warned yesterday.

Wealthy nations have betrayed poor countries by going back on promises to end farm subsidy regimes that help keep millions in poverty, Joseph Stiglitz said. Professor Stiglitz singled out US subsidies for cotton producers, which help 25,000 American farmers but hurt 1 million in sub-Saharan Africa, as a potential deal breaker.

He said he feared President George Bush's "reverse skills" in negotiating could stymie a deal. But he endorsed a plan put forward by Peter Mandelson, the European Union's trade chief, as a step in the right direction.

The 148 members of the World Trade Organisation meet in Hong Kong this month against increasingly gloomy forecasts that they will fail to find enough common ground for a new global pact before a December 2006 deadline. "I think the chances of failure are high," Professor Stiglitz said in a wide-ranging interview with The Independent during a UK visit to promote his book on the talks, Fair Trade for All.

Professor Stiglitz was asked by the Commonwealth, which includes rich, middle-income and poor countries, to draw up an economic framework for a pro-development deal. He said rich countries had to end their decades-old culture of bargaining and instead make concessions that would live up to Tony Blair's anti-poverty agenda for the UK's presidency of the G8.

"The US negotiators are lawyers and believe in bargaining," he said. "If they want a deal, they are going have to change hats. I don't think the US, or at least the current administration, has yet to see it needs to have an emotional commitment."

He said the EU and US had missed an opportunity to aim to make trade fair for poor countries when it persuaded the WTO to launch fresh talks in 2001 in Doha after the collapse of negotiations in Seattle in 1999.

"This does not deserve to be called a development round," Professor Stiglitz said, saying the negotiations locked in injustices from the Uruguay deal in 1993. He endorsed Mr Mandelson's plan to end cotton subsidies, open up rich country markets to the least developed countries and ensure access to poor countries for medicines to fight disease.

Professor Stiglitz suggests that if the talks make it through Hong Kong, a deal could be brokered by a commitment by all countries to provide free market access to all developing countries smaller and poorer than them.

Comments