NATIONAL 6 -(Spotlight Weekly)]

Something for Everyone

The agreement to launch a new trade round may be good news, but countries like Nepal need to work hard to enter an open trading regime

By BHAGIRATH YOGI

Besides its Al Jazeera TV channel that enjoyed exclusive coverage of the Afghan war, the Qatari capital of Doha was in the news last fortnight for another reason. Trade ministers of 142 member countries of the World Trade Organization (WTO) and several others as observers had gathered in this Gulf sheikhdom to discuss promoting free trade around the world.

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Though the third ministerial level conference of the WTO failed in Seattle, USA in late 1999 amid unprecedented protests from different lobbies and a tug-of-war between the developed and developing countries on the issue of launching a new trade round, the Doha conference began on a more

accommodating note. As the values of liberalization, globalization and free market lay under attack from the global terrorism, the members of the multilateral trading regime had no alternative to accommodating each other's concerns.

The extended six-day conference (Nov. 9-14) adopted a work program, described as "broad-based and balanced," in the form of two declarations ó a main declaration and one on intellectual property (TRIPS) and public health ó and another on implementation to address developing countriesí difficulties in implementing current WTO agreements.

The main ministerial declaration includes elaboration of objectives and timetables for the current negotiations in agriculture and services, negotiations or possible negotiations in a range of issues such as

industrial tariffs, trade and investment, trade and competition policy, some aspects of trade and the environment, implementation, and so on. The declaration also called for addressing "the particular vulnerability of least developed countries and the special structural difficulties they face in the global economy." Negotiations under the work program are to be concluded not later than January 1, 2005. Thanks to relentless lobbying by the developing countries, the all-night consultations on November 14 agreed to postpone negotiations on the issues of investment, competition policy, transparency in government

purchase and trade facilitation (collectively called new issues) till 2003.

On the issue of fixing environmental standards for trade, the conference proposed to start negotiations after the fifth ministerial conference of the WTO in 2003. The developing countries saw the amendment to TRIPS (Trade Related Intellectual Property Rights) to allow countries to low priced patented drugs in case of a public health emergency as a significant victory. For Nepal, prompt accession to WTO and preferential access to the Least Developed Countries (LDCs) in the markets of the rich countries were high on the agenda.

Addressing the ministerial meeting as an observer, newly appointed Minister for Industry, Commerce and Supplies Purna Bahadur Khadka said meaningful integration of LDCs into the world economy had emerged as a major challenge in the Doha meeting. "Facilitating accession of LDCs that have completed the minimum requirements with commitments towards WTO provisions should be seen as a logical first step in integrating these countries into the rule based multilateral trading," said Minister Khadka. He also welcomed the entry of China into WTO.

With a view to joining the multilateral body, Nepal has completed all the initial mandatory requirements, including transparency in trade policies and commitments in goods and services sectors. But critics said expectations of higher levels of commitment than those undertaken by the current LDC WTO Members, among others, have resulted in such a situation that not a single LDC has succeeded in acceding to the WTO since its establishment in 1995.

"We believe trade needs to be considered within a broader development context. Nepal hopes to achieve the development goals by integrating its economy into the multilateral trading system with commitment to the principles and provisions of WTO," said Minister Khadka.

As Nepalese officials hope to accede to the WTO by the end of 2002, the Doha conference gave the Nepali delegation an opportunity to learn about the push and pull within the world body. "The Doha meeting has reinforced the international communityís commitment toward the multilateral trading system through WTO," said Dr. Posh Raj Pandey, national program director of the UNDP-assisted Nepal's Accession to WTO project and a member of the Nepalese delegation. "For Nepal, the provision of technical assistance to remove supply constraints of the LDCs and formation of a working group to study the foreign debt are positive developments. Although LDCs could not get what they expected, every country got at least something out of the Doha meet."

This is because of the poor bargaining capacity of the LDCs, said experts. They could not change substantially the portion related to LDCs in the draft declaration. "The bottom line is that we must enhance our competitive strength," said Prachanda Man Shrestha, joint secretary at the Ministry of Industry, Commerce and Supplies and a Nepalese delegate. Added Rajendra K. Khetan, vice president of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), "Before becoming a WTO member, Nepal should devise ways to protect the domestic industries that will be hurt in an open trading regime. We should promote areas like tourism and offshore banking which donít fall under WTO regime."

Upon his return from Doha, Khetan was worried to see that the Nepalese private sector had very little interest and knowledge about the all-important WTO meeting. "Our private sector hasnít prepared

seriously for the post-WTO regime. So, we must complete our homework and try to cash all the facilities due to the LDCs before joining the WTO," he added.