Singapore offers to host first meet of new trade body
SINGAPORE has offered to host the first ministerial meeting of the World Trade Organisation (WTO) – an international body with more muscle to enforce trade rules.
The WTO is the outcome of seven years of negotiations to replace the General Agreement on Tariffs and Trade (Gatt) with a better system.
Trade and Industry Minister Yeo Cheow Tong told his counterparts from over 120 nations attending the formal end to the Gatt Uruguay Round of talks in Marrakesh that if Singapore’s invitation was accepted, “this will be the first time a major global trade meeting will be held in Asia”.
“It will complete the circle of Uruguay Round meetings that began in South America in Uruguay, then moved on to North America, to Europe and today in Marrakesh, Africa,” he said on Wednesday.
“This choice of an Asian venue would be significant as a recognition of the region’s important and growing contribution to global trade today.”
The first ministerial meeting of the WTO is due to be held in two years.
The ministers in the Moroccan city of Marrakesh will sign the Uruguay Round’s Final Act and a special treaty creating the WTO today.
Set to become the third pillar in world economic management, alongside the International Monetary Fund and the World Bank, the WTO will have stronger powers than Gatt to enforce rules and prevent trade conflict. Trade officials call it the “crowning achievement” of the Uruguay Round, launched in 1986 and concluded three years behind schedule last December.
Besides creating a new world trade watchdog, countries will roll back barriers to exports in traditionally protected areas like agriculture and textiles, and protect copyright and patents from abuse.
Also on the cards is a 2,000-page list of new, lower import duties. Overall, the successful Round is expected to pump an additional US$200-300 billion (S$320-480 billion) annually into the world economy by early next century.
Mr Yeo said the challenge facing countries now was to “see through the successful establishment of the WTO and implement the various agreements”.
To meet the target dates for implementation, countries needed to focus their attention on “mainstream” areas such as market access in some services sector.
Describing Singapore as “one of the most open economies”, he said the Republic had virtually no import tariffs or protection for its domestic industries.
He added that Singapore had done its bit for greater trade liberalisation by removing its duties and binding about 70 per cent of its tariffs at a maximum rate of 10 per cent.
“Singapore sees the mission of the WTO as being that of a trade facilitating body aimed at expanding production and trade in goods and services via the lowering of trade barriers,” said Mr Yeo.
“In this context, the justification for extending the coverage of the WTO into social rights and labour standards is not clear to all members,” he added, referring to developing countries’ fear that it could be a ploy to impose restrictions on their exports.
He said that in most cases, wage disparities arose because of differences in levels of economic development. This was part of the developing countries’ comparative advantage.
“There is also a fine line between discussions of trade issues, and what is perceived by many as the use of trade to bring external pressure for change in countries’ domestic, political or social structures.”
Mr Yeo said that Singapore had learnt long ago that the free market system was the way to economic growth and prosperity and “we obviously have a major stake in the successful establishment of the WTO”.
“Singapore will give the WTO our fullest support,” he said.