The WTO has met with controversies and oppositions unlike other international organizations. There have been demonstrations and slogans against its management and policies.

The main criticism against the WTO is its undemocratic structure and operations which favour developed countries. Its objective to promote trade liberalization is laudable, but it is being taken with a pinch of salt. Developing countries are wary of the role of “multinationals” who are the “spawners of bubble economies” in several parts of the world. In Doha meeting attempts were made to resolve several controversial issues, but still many exist. The precise role of WTO is being debated, how to balance its effectiveness to protect the interest of all members is still a big question mark.

Though Pakistan is a small player in international trade, it can play some useful role together with the SAARC countries and China. Pakistan should emphasise the fact that the WTO was established when deregulation and liberalization of market forces was sweeping the world. At the start of the new millennium, mainstream thinking had been modified and the need for an enhanced political influence and steering mechanism for economic processes was recognized. This shift in the paradigms and the experience of the functioning of the WTO show that there is a need to clarify the focus of the organization and to reform its working methods and decision-making procedures to achieve transparency in its operations. It has three key functions:

(i) To promote a gradual liberalization of trade through negotiations. The regulation and lowering of tariff rates are key instruments.

(ii) To provide a forum for developing commonly agreed rules and regulations.

(iii) To act as a binding dispute settlement system.

Equal treatment of the WTO members is one of the core principles of the multilateral trading system with few exceptions. Free areas are allowed under specific conditions and countries are allowed to raise trade barriers against the products on unfair trading.

In the reform process, priority consideration should be given to streamline the WTO’s focus. Policy makers and economists agree that the three key functions should remain its main focus in future. There is a need to tackle the more difficult issues relating to trade along with addressing the concerns about environment, labour standards and the preservation of national cultures.

The WTO should not strive to become an international organization which settles the environmental, social, labour or cultural issues. The division of responsibilities between the WTO and those international organizations which have the competence to tackle these issues should be clarified and cooperation between them intensified — the cooperation between the ILO and the WTO being a good example.

It is imperative to establish a coherent global mechanism where trade and other issues can be dealt with, in a balanced manner and where these issues will not be allowed to lead to divisive and disruptive conflicts, nor create new unfounded barriers of access for developing countries.

The WTO reform should aim at greater transparency and real democracy thereby, enhancing its credibility. The degree to which it represents its members, requires the WTO to make serious efforts in terms of improving its transparency, working methods and communication. The rules of the international trading system must reflect the actual needs of all relevant parties, including the member states, business community, civil society and different interest groups. In internal decision-making the key problems are relative weakness in terms of the possibilities for developing countries to play an equal role in the work of the WTO and in its negotiations. The practice of restricted informal meetings play into the hands of industrialized countries and self-seeking multinationals.

Regarding trade and development, it is necessary to bring about a profound and transparent process of reviewing all existing agreements on trade and agriculture. The impact of the WTO agreements on the issues like development, democracy, marginalized and indigenous communities, food security, environment, health, human and labour rights of children should be thoroughly reviewed. Developing countries face great difficulties in implementing parts of agreements within a set timeframe and in some cases they go against their development objectives or national interests.

As regards reforms of the TRIPs agreement, a review and revision of the present TRIPs agreement is of particular interest for the developing countries.

The present agreement has enabled the transnational corporations to patent life forms, which have been developed and used locally for a long time. This has seriously threatened the food security situation in many regions. The case of patenting the Basmati rice by the USA is a case in point. The present TRIPs agreement has also prevented a large number of developing countries from producing affordable drugs by adapting technologies and has increased their dependency on the western transnational pharmaceutical industry.

A revision of the present TRIPs agreement should take account of the following principles:

* Plants, animals, micro organisms and all other living organisms, as well as natural processes that produce living organisms should not be patented.

* Any patent protection legislation should provide for the protection of the innovations of indigenous communities in developing countries, and the continuation of traditional farming practices.

* The TRIPs agreement should be harmonized within internationally agreed conventions, such as the convention on bio-diversity, covering the compensation and benefit sharing of commercial exploitation of genetic resources.

Reviews of all these agreements must be implemented within an independent framework and with the full participation of civil society. The results of these reviews should be used as the basis for reforming and revising existing agreements as well as in negotiating any new agreements.

Industrial countries failure to implement their commitments is one of the main obstacles in the work of the WTO. The key issues are the timetables for dismantling subsidy and tariff structures affecting developing countries, the reduction of agricultural subsidies during the period 1995-2000 and the gradual liberalization in the areas of textiles and clothing. This includes the so-called Marrakesh decision on measures to ease the negative effects of the liberalization on the agricultural sector. Improving market access for developing countries is one of the key instruments.

The following guidelines are necessary to serve a basis for any new agreement within the WTO.

(i) Market access for the products of developing countries should be improved and in the short-term the least developed countries should be given special attention. Free market access for all products from the LLDC’s should be implemented as soon as possible and developed countries must show a clear commitment to this.

(ii) The possible misuse of the rules of anti-dumping in the name of protecting home markets should be ruled out. Developing countries must be supported in building a capacity to monitor and enforce rules on anti-dumping.

(iii) Developing countries should be given a clearly defined framework within which they can protect their own domestic food production and consumption as well as the livelihood of their farmers.

(iv) Developing countries should also be provided with support in installing necessary food security regulations and standards. (v) Tariff escalation on processed goods by developed countries should be phased out.

(iv) The complete and gradual phasing out of export subsidies among developed countries has become a necessity. Subsidies to the agricultural sector might be necessary due to the so-called multifunction of that sector, but the marketing of the subsidized over production of agricultural products on the world market should be abolished.

Suggestions: Pakistan would be well advised to discuss these in the trade committee of SAARC and with other countries like China and raise these issues in the next WTO meeting. Adequate care should be taken to ensure that the WTO does not go the way the GATT and the UNCTAD went. Despite the existence of these organizations, the distribution of world wealth became more uneven after the Second World War. Sustained economic growth still eludes half the world economies. According to the UN: “The disparity in per capita income between the poorest and the richest countries was one to twenty 50 years back. Today it is over three hundred. In reversing the falling income in the developing world and counteracting global mal-distribution of wealth, trade plays a crucial role. The strategic steps that the WTO can take after reforming itself are:

I. To promote multilateral trading, the WTO should foster regional and sub regional trading system.

II. Promotion of gradual liberalization of world trade through negotiation must continue as a key function. However its role should not be extended beyond liberalization regime. in the past many developing countries suffered because they were not adept or skilled in trade negotiation and did not get a fair price for their produce. This is a continuing deficiency that needs to be removed. The WTO must structure itself to give, on request, technical assistance promptly and effectively to developing countries for negotiating trade deals.

III. A lot of work has already been done by the UNCTAD and the GATT in developing commonly agreed trade rules and discipline. The WTO should, therefore, work in close contact with the UNCTAD.

Similarly for dispute settlement it should have close liaison with the International Chamber of Commerce and Trade.

IV. The present TRIPs agreement needs to be revised. Any patenting of plants, animal, micro-organism and other living organism will be detrimental to the economic interest of the developing world. Patenting must not be allowed anymore to be used by the multinationals to gain control of the economic resources of the developing world.

The case of biological diversity is a case in point. Most industrialized countries are generally poor in biological diversity but are rich in biological technology, essential for converting the generic variability into economic wealth. Another strategic step by the WTO would be to promote the TRIPs Agreement in such a manner as to strike a balance between the two for mutual benefit.

Agriculture plays a leading role in the trade regime of the developing world. Of late the sustainability of agriculture is at stake because of self-seeking interest of the multinationals. While agriculture is being marginalized in the developing world, it is being commercialized in the developed world. This is a serious matter. The WTO, must therefore act in close coordination with the FAO with a view to establishing a competitive edge for agricultural produce of the developing countries.

All these necessarily point to a strong institutional set-up of the WTO to discharge its three strategic roles (i) advisory, (ii) regulatory and (iii) problem solving.

A balanced representation in this organization both from the developed and the developing countries is essential.

The WTO should have the will and determination to reform itself and work closely with the FAO, the ILO, the UNCTAD, the UNDP, the UNEP and multilateral developing financing agencies.