Helping Commonwealth developing countries cope with loss of trade preference
16 September 2004
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| Many Commonwealth developing countries export to developed countries. |
Dr Roman Grynberg, Head of International Trade and Regional Co-operation in the Commonwealth Secretariat's Economic Affairs Division, said the proposal will be presented to finance ministers for their consideration at their meeting in St Kitts and Nevis on 28-29 September 2004.
Dr Grynberg, who was speaking at the Royal Commonwealth Society on 14 September, said the Commonwealth is also working with other intergovernmental organisations such as the World Bank and the European Union in an effort to define a strategy to help developing countries deal with the loss of trade preferences.
"Without a mechanism that helps these trade preference dependent economies adjust towards the emerging global economy, it is highly likely that the pace of their marginalisation will only accelerate," said Dr Grynberg.
In his talk on 'Trade Policy and the Commonwealth Secretariat', Dr Grynberg noted that if trade liberalisation creates net losers and gainers within a system based on consensus, then the net losers can halt the process of negotiations in the WTO's Doha Development Round. Trade preference dependent countries may choose to do so. To avert this, he said, these countries must be assisted to enable them to cope with the challenges posed by trade liberalisation.
"Many Commonwealth developing countries export to developed countries under the trade preference arrangements, such as the Cotonou Agreement, and in fact depend on these preferences to be able to export. The decrease in tariffs that follows from liberalisation has decreased the margins of trade preference enjoyed by many Commonwealth developing countries, consequently affecting their exports."
Dr Grynberg said the continual loss of trade preferences may well lead to the disappearance of traditional export sectors of many Commonwealth developing countries such as sugar, bananas, beef, tuna and garments to markets in the developed world. He pointed out that the loss of trade preference creates an anomaly that has recently been recognised by International Monetary Fund and World Bank experts.
He also highlighted the recent Secretariat-commissioned study by the Nobel Laureate in Economics, Professor Joseph Stiglitz, which points a way forward for the development of a consensus on a genuine development agenda for the Doha Round of trade talks. Dr Grynberg stressed that the Secretariat supports the process of liberalisation while seeking to ensure that it is a process that is inclusive, equitable and benefits all Commonwealth citizens.
CNIS - the Commonwealth News and Information Service Issue 201
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