WORLD TRADE WT/MIN(98)/ST/9
18May1998
ORGANIZATION(98-1967)
Original: English MINISTERIAL CONFERENCE
Second Session
Geneva, 18and20May1998
WORLD BANK
Statement circulated byMr.Masood Ahmed
Vice-President andHead ofthePoverty Reduction
andEconomic Management Network
(asanobserver)
Onbehalf oftheWorld Bank, itgives megreat pleasure tooffer mycongratulations tothe
WTO ontheoccasion ofitssecond Ministerial Meeting andits50thbirthday. ThefirstMinisterial
Meeting, inSingapore, wasanhistoric occasion, institutionalizing theresolve oftheworld community
topushforward onstrengthening theframework ofinternational cooperation. Thissecond conference
isjustasimportant, asmembers reaffirm theircommitment toabroad-based andopenglobal trading
system andsetintrainawork program toachieve substantial progressive reductions insupport and
protection.
Over thepast50years, theGATT andtheWTO havebuiltaglobal trading system likenone
seenbefore --asystem thatlinks thecountries oftheworld evermore closely, andthatprovides
opportunities foralltoparticipate. Thissystem isbuiltonsimple principles likemarket orientation
andnondiscrimination thathaveproved tobepowerful agents foreconomic development andhuman
progress.
TheWorld Bank isproud tohavebeenapartner withtheWTO during theunprecedented era
oftrade liberalization thatbegan inthe1980s. TheBank helped many developing countries tomake
thetransition frominward-oriented development policies totheopentrade policies thatareconsistent
withWTO rules. Between 1981, when theBank’spolicy-based lending began, and1994, when the
Uruguay Round wassigned, theWorld Bank made 238policy-based loans supporting tradeorforeign
exchange reform. These loans, to75different countries, supported developing country trade reforms
affecting imports ofover$500 billion in1993.
Atthesame time, complementary progress wasoccurring atthemultilateral level. The
liberalization achieved intheUruguay Round increased global realincomes byaround $200 billion,
andjustasimportant were theRound ’sachievements inimproving therules ofthetrading system.
The(re)inclusion ofagriculture, andtheinclusion ofaframework forservices liberalization provide
thescope forenormous gains inthefuture. Theextent towhich thesegains arerealized depends heavily
onthedecisions reached atthisandthenextMinisterial meeting, andonthehardnegotiations that
willinevitably follow.
ThethreemajoragreementsreachedsincecompletionoftheUruguayRoundshowthedynamism
oftheWTO system. Weareparticularly pleased tohavebeenabletohelpdeveloping countries directly
inthepreparation oftheiroffers ontelecoms. TheInformation Technology Agreement showed the
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potential ofthenewWTO system tomake quick progress innewareas where technology isadvancing
rapidly andpolicy positions havenotyetossified.
Itistempting tothinkthattheWTO should goonharvesting largesectoral gainslikethiswithout
thetrouble ofembarking again onacomprehensive round ofnegotiations. And,indeed, ifliberalization
occurs itdoesnotmatter verymuch through whatmeans. However, itisnotatallclearthatthesectoral
route cancontinue toyieldfruit. TheWTO isaco-operative venture between sovereign nations, which
relies onmutuality andabalance ofadvantages tofunction. Thekeyissues forfuture negotiations
arehighly sensitive --that,afterall,iswhytheyremain issues after50years ofmultilateral negotiations
--andtheywillberesolvable onlyinthecontext ofcross-sectoral compromise andtradeoff.
TheUruguay Round ’sbuilt-in agenda andthetopics introduced inSingapore provide auseful
basisforthinking about future negotiations, butitwillnotbepossible toconstruct amutually beneficial
package ifthere istoomuch prior picking andchoosing among them. Indeed, thelistcould evenbe
extended: forexample, developing countries might wishtoaddress industrial country tariffpeaks and
industrial countries torequest reductions insome oftheunnecessarily hightariffbindings ondeveloping
country manufactures.
TheUruguay Round sawthelarge-scale entryofthedeveloping countries intothecorebusiness
oftheWTO --theexchange ofmarket access concessions. Developing countries willbeevenmore
important inthefuture because oftheirpredominance bothinthemembership oftheWTO andthe
accession queue, andtheirincreasing shares inworld trade. Thiswillmake itevenmore important
thatissues ofconcern tothem, suchasthetimely andcomplete abolition ofthetextile quota system,
reductions inprotection oncommodities ofexport interest todeveloping countries, andthemovement
ofnatural persons, receive fullattention.
Some estimates suggest thatsome developing countries gained verylittleorevenlostfrom
theUruguay Round. Thisisessentially because theylostasother members reduced theirdistortions,
suchasagricultural subsidies, butfailed tobenefit byremoving theirown. Toavoid suchimbalance
infuture, thesecountries willneedtoparticipate actively intheexchange ofmarket access concessions.
TheWorld Bank isready toprovide support suchparticipation boththrough itsanalysis andthrough
financial support inthecontext ofappropriate policy programs.
Theleastdeveloped countries havehadconsiderable difficulty inparticipating fully inthe
multilateral trading system. TheIntegrated Framework fortheLeast Developed Countries, inwhich
theBank ispleased tojoinwiththeWTO andother agencies, aimstohelpthese countries build their
capacity toparticipate inthesystem, notleast through a“positive ”agenda ofreform inareas such
asenterprise andhuman development, trade facilitation andinfrastructure. Lastweek, theBank’s
Executive Board formally welcomed andendorsed theFramework andtheBank’scontribution toit.
Anopentrade regime remains central toachieving efficient anddynamic development. For
thisreason, theWorld Bank commends attempts byallcountries, developing andindustrialized, to
further liberalize theirtrade regimes inanon-discriminatory fashion. TheBank intends tocontinue
tocontribute tothisendthrough policy dialogue, analysis andtechnical cooperation bothonitsown
initiative, andincooperation withitsmembers andpartner organizations.
Inclosing, Iwould liketowishthemembers oftheWorld Trade Organization thegreatest
success intheirdeliberations inthisimportant meeting. Itisameeting thatwillplayacritical role
insetting theagenda andshaping trade policies forthenewmillennium.
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