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West asked to lower trade barriers

By Our Special Correspondent

HYDERABAD Jan. 6. Even while stating that it will be beneficial for developing countries to provide greater access to their own markets, Raymond Lim, the Singapore Minister of State for Foreign Affairs and Trade and Industry, has said that `developed countries must open their doors to developing countries- and lower their significant barriers to agriculture trade, whether in the form of tariffs or subsidies'.

He was making a presentation on `The International Trade Policy Agenda: Going Forward', on the second day of the ongoing Partnership Summit organised by the Confederation of Indian Industry (CII) here on Monday.

Mr. Lim said this was a commitment made at the Doha meet and must be fulfilled. Even on non-agriculture trade, he said developed countries must reduce non-tariff barriers too. At the same time, he pointed out that on an average, a developing country will gain more if tariffs in developing countries are reduced, than if tariffs were reduced in developed countries.

To support this argument, he pointed out that developing countries pick up 40 per cent of annual world tariff bill on industrial goods, even though they account for only 22 per cent of the world's GDP. Even more alarming, he said, was the fact that 70 per cent of the tariffs paid by developing countries (some $57 billions annually) are paid to `other developing countries'.

Stating that this was only one example of how developing countries could help one another through greater cooperation, he said India was seen as a leader in the developing world and could play a major role in showing the way forward.

The British Minister for Trade and Industry, Patricia Hewitt, said India was one of the world's five fastest growing economies (even set to overtake UK in size), and must take a lead in "writing the new rules of the global economy''.

Even while calling upon countries like the US to cut its tariffs and import quotas and join India and the developing world in a compromise of TRIPS, she said the "greatest trade barriers faced by the producers of the developing world are not the barriers put up in the West -- they are trade barriers of the developing countries themselves.''

Emphasising the need for Europe to open its own markets to Indian products, she pointed out that `the European Union is giving a $2 a day subsidy to every cow in Europe, when over one billion men, women and children in the world live on less that half that amount''.

Reiterating the U.K's commitment to the Doha Development Agreement, she said U.K. had also been suffering. For example, the textile manufacturing was contracting steadily, and was expected to contract further when its market for textiles is fully opened in 2005. "We have suffered pain in other sectors. Our steel and coal industry have been cut back very sharply for the past 10-15 years. Our agriculture is feeling the squeeze and the number of farmers leaving the land is accelerating,'' she said. Similarly, India would also have challenges to face, ``but you will make gain too,'' she concluded.

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