The Ninth Ministerial Conference of the WTO will be held in Bali, Indonesia, on 2nd December 2013. In most neighbouring countries, high-level brainstorming has already started as to what position a country might take at this important meeting aimed at strengthening rules-based multilateral trading system. Such in-country meetings have the participation of business community, academia, non-governmental development organisations and media. One expects that the Government of Pakistan will also evolve a consensus at national level before participation at this meeting.
Pakistan’s emphasis in its official position should be carefully formulated. As much as Pakistan has always supported the multilateral trade paradigm, equally important is to hold development dimension in all areas of negotiations as central. There have been complaints regarding transparency in the process of WTO negotiations. Such grievances need to be addressed if one is to uphold the sanctity of this important platform. The issue of transparency is particularly important in the case of negotiations on plurilateral services. Several rounds of such negotiations have actually taken place behind closed doors where many WTO members were not present. This is against the Ministerial Declarations of Doha and Hong Kong.
After the global financial crisis of 2007-08 several WTO member countries resorted to trade restrictive measures in turn giving rebirth to protectionism. These countries had hoped that such measures would save their domestic output and in turn help in restoring pre-crisis export levels. However, it is not surprising now to see that even in 2012 (several years after the crisis) the global trade growth saw a decline. It may be noted that most South Asian countries including Pakistan refrained from such measures. In the interest of global trade, value addition and in particular export-oriented jobs in developing countries, other WTO member countries should also do away with any such remnants of the crisis period.
Some key negotiations in WTO which are of utmost importance to the multilateral trade agenda include food security, climate change induced threats to agricultural production and trade, food aid, livelihoods of poorest of poor farmers, and effective market access on products which are of export interest to development economies. All WTO members should refrain from export subsidies specific to agricultural products. The Hong Kong Ministerial Declaration has already set 2013 as the deadline for eliminating such export subsidies. This is also in line with G33 proposal for early agreement to address food security issues.
In the services sector negotiations, Pakistan must stress upon market access in all categories of services sectors in particular Mode 4 (in which Pakistan has considerable comparative advantage). The country’s services sector has over 50 percent share in GDP. A large qualified labour force is dedicated to this sector. It is equally important that Pakistan should press on delinking Mode 4 from Mode 3. The other pending issues under the services trade that all developing countries wish to see addressed include, prohibitive visa regimes by developed countries, lack of mutual recognition of professional qualifications, removal of burdensome licensing requirements, and restrictive requirement of professional association’s membership.
Trade facilitation is another important area where Pakistan should pronounce its official position. Like other developing countries we understand that any facilitation that aims to simplify and standardise the supply chain can significantly reduce transactions costs. However the local capacity to implement and manage the trade facilitation agenda is missing. Pakistan has struggled for around a decade to make National Trade Corridor (NTC) a success. However, owing to sheer lack of co-ordination in the government machinery none of the objectives under the NTC project have been achieved. Countries such as Pakistan need technical assistance in this area from advanced trading partners.
A point similar to the above is the monitoring of technology transfer. The Doha Ministerial meeting had agreed on a mechanism of monitoring; however since 2003 the progress has been very slow. Pakistan along with other developing countries in particular LDCs should stress upon stronger monitoring mechanisms for technology transfer to the developing economies.
It is also important for us to give a common Saarc position at WTO. In order to widen Saarc’s influence at WTO, early accession of Afghanistan and Bhutan to the WTO should be emphasised. This demand of SAARC countries will be in line with the WTO’s Istanbul Plan of Action. For Saarc to become a vibrant collective voice at WTO, there should be extensive meetings among South Asian countries at all levels of government machinery including political representatives, ministerial position and civil service. The frequency of these meetings has been very low; thereby hampering the progress towards a common regional vision on trade.
Finally, it is important to note that countries can only benefit from a multilateral trading regime if they are able to import cheaper intermediate goods for production and produce value added exports. For this to happen the urgent reform of national institutions that promote market competition, spur innovation in agriculture and industry, and encourage a supportive services sector is needed. The regulatory bodies that are entrusted with the task of checking anti-competitive practices must be allowed maximum autonomy without government intervention.
This article was originally published at: Business Recorder
The opinions expressed in this article are the author's own and do not necessarily reflect the viewpoint or stance of SDPI.