Connect with us

Hi, what are you looking for?

Capital Business
Capital Business

Kenya

WTO warns over stalled trade talks

NAIROBI, Kenya, Mar 31- It has been 10 years since the Doha Round of Multilateral Trade Negotiations started and the World Trade Organisation (WTO) Director General Pascal Lamy has warned that developing countries will be major losers if they fail once again to conclude the talks by the end of this year.

Mr Lamy who is on a visit to Kenya, said on Thursday that if developing countries do not reach a compromise on the Doha Development Agenda in the next few months, their private sector would suffer extensively.

"Failure to conclude the round will be bad news for businesses in developing countries than for firms in richer countries. Richer countries believe they have other channels to open up trade and entering into bilateral trade maybe tempting for them," he said candidly.

The next few weeks will be crucial for the fate of the negotiations that aim to bridge the trade imbalance between developed and developing countries and in effect for the fate of the international trade and the global economy.

This is especially so after the US government came on board in August 2010 which was expected to help expedite the process.

"My duty is to tell the members the truth and the truth is that the risk of failure of this negotiation is much higher than it was a few months ago and certainly (it is) not in line with what the G20 leaders said last November in Seoul," Mr Lamy said.

He was referring to the ultimatum given by the leaders during the G20 Summit last year in Japan to their negotiators to conclude the talks this year.

The negotiations are structured in a way that all the issues have to be agreed upon by all parties for development agenda to be passed and adopted.

And while consensus has been reached on 80 percent of the issues, there has been deadlock on the remaining 20 percent of the issues which include industrial tariff reduction, agricultural subsidies and market access which have led to the stagnation of the talks.

Advertisement. Scroll to continue reading.

The classification of Brazil, India and China (BRICs) as developing countries has been one of the major sticking points as it would in turn affect market access since as \’big boys\’ the BRICS are required to open up their markets just as the developed countries have done.

Africa, which accounts only for two percent of the global trade, has been looking to conclude an agreeable and beneficial outcome that would enable it to increase its exports and create more opportunities for wealth creation and poverty reduction.

There is consensus that the multilateral trade system is the only way that the continent can systematically integrate their trade and investments into the global economy.

But trade experts have been adamant than African countries should not just blindly rush into and sign a deal that would not be beneficial to them in the long run.

Trade Permanent Secretary Eng. Abdulrazaq Ali however expressed optimism that the talks would be successful but was quick to challenge the private sector to diversify and add value to their products.

"With opening up of the market, we need to go beyond dealing with primary goods otherwise we will not be able to take advantage of market access," Eng Ali.

This challenge is particularly important for Kenya whose 60 percent of exports come from horticulture and tea.

"We need to go for more intermediate products and finished goods as well," the PS added.

Kenya is the chair of the African group in Geneva and while Prime Minister Raila Odinga reiterated the country\’s commitment to the conclusion of the round, he expressed concerns about the slow pace of the talks terming them as \’burdensome.\’

Advertisement. Scroll to continue reading.

"Kenya expects the outcome to reflect the development concerns of the developing countries. These negotiations must succeed and failure is not an option," the premier said.

He appealed to the Western world to sympathise with Africa and other developing countries and understand that the position they were taking takes into account the plight of millions of poor people who would be affected if they failed to reach a favourable deal.

"Therefore it calls for a feeling of humanity and compassion to understand the percentages that you are haggling over affect the lives of these people and therefore we must be prepared to walk the extra mile in the interest of humanity and reach a solution," Mr Odinga concluded.

Follow the author at https://twitter.com/cirunjoroge
 

Click to comment
Advertisement

More on Capital Business

Executive Lifestyle

NAIROBI, Kenya, Mar 12 – The country’s super wealthy individuals are increasing their holding of bonds, gold and cash, a new report by Knight...

Ask Kirubi

NAIROBI, Kenya, Mar 9 – Businessman and industrialist Dr. Chris Kirubi has urged members of the public to exercise extreme caution when making any...

Ask Kirubi

NAIROBI, Kenya, Mar 24 – Businessman and industrialist Dr. Chris Kirubi is set to own half of Centum Investment Company PLC, following a go-ahead...

Ask Kirubi

It is without a doubt that the COVID-19 pandemic has caught the whole world by surprise. Although its full impact is yet to be...

Headlines

NAIROBI, Kenya, Mar 18 – Commercial Banks have been ordered to provide relief to borrowers on their personal loans, with loans eligible from March...

Kenya

NAIROBI, Kenya, Jun17 – Kenya’s tea leaves manufacturer Kericho Gold, has been awarded the Superbrands Seal by Superbrands East Africa for their quality variety...

Coronavirus

NAIROBI, Kenya, Apr 13 – As the local telecommunications industry gears up to roll out 5G networks in the country, the Communications Authority of...

Coronavirus

NAIROBI, Kenya, Mar 22 – Airtel Kenya is offering free internet access for students in order to enable continued learning at home in the...