September 23, 2003	Tuesday	Rajab 25, 1424

KARACHI, Sept 22: Developing states are likely to evolve a new strategy for the WTO meeting scheduled for mid-December 2003 as the demise of “peace clause” under the Uruguay round by year-end will bring them added leverage in negotiations with rich nations, sources here said.

The “peace clause” restrained countries from filing WTO complaints against dumping of farm products as long as each member did not deviate from its commitments.

Commenting on the outcome of the Cancun conference, trade experts here say they foresee a spate of disputes being raised for WTO arbitration after the peace clause runs out. This will induce the Americans and Europeans to negotiate on farm trade on reciprocal basis, they added.

These experts share the perception of many delegates at the Cancun conference, particularly the Brazilians who are confident that trade disputes at the WTO could serve as a strong leverage to persuade wealthy nations to provide even playing field to the poor third world farmers.

The bargaining position of the Third World, it is pointed out, has already been strengthened by the new found unity and the economic strength gained since their independence in the last century.

With overall external assistance and the level of foreign investment inflows into the poor states declining, specially after industrial world plunged into economic slump, trade on reciprocal basis alone offers them some opportunity to improve their domestic economies.

But, as US trade, current account and fiscal deficits mount and dollar depreciates, Washington is turning protectionist. Before the economic slump beginning from 2000, the US accounted for two-third of world’s economic growth. Now, it no longer offers any reliable export market for the future, with it’s total debt exceeding $5 trillion. In European and Japanese markets, the situation is not different because of economic slowdown.

Pakistan had joined African delegates at Cancun in pressing for elimination of subsidies by certain developed states that deprives developing states of billions of dollars in trade and revenue earnings. The US gives $3 billion subsidy to its cotton farmers.

Talks would be resumed when the WTO general council is convened at Geneva not later than December 15 as decided by ministers attending the Cancun conference. The WTO general council chairman and the director general of WTO were asked to coordinate the meeting.

The rich countries’s subsidy to their affluent farmers has remained at $300 billion for the past 15 years when the issue first appeared on the agenda of the Third World.