KARACHI, Nov 12: Dr Manzoor Ahmed Khan, Ambassador and Pakistan’s permanent representative at WTO, Geneva, said on Saturday Pakistan was striving hard for an early conclusion of negotiations on lowering of tariffs the world over because it would directly benefit developing countries in minimizing the adverse impact of the duty free access status enjoyed by the least developed countries (LDCs).
“Once international tariff rates come down to around seven to eight per cent, the disadvantage against the LDCs will reduce to the extent they enjoy zero-duty access to developed countries markets,” he maintained.
Dr Manzoor, who is presently on a consultative tour ahead of the WTO 6-MC moot being held in the middle of next month in Hong Kong, held a marathon session with the FPCCI members to evolve a strategy on key issues pertaining to trade, industry, agriculture and services sectors of the country.
He said that about a week back in a positive development the US and the European Union had shown inclination for reducing internal and export subsidies being given to their agriculture sector. The EU, however, had linked it with the services sector where it sought a greater market access from developing countries, he added.
With regard to tariff reduction, Dr Manzoor said developed countries wanted developing countries to bring down their tariffs to 10 per cent, but developing countries insisted on keeping them around 30 per cent. Similarly, he said developing countries wanted the West to lower their tariffs to six to eight per cent, as this would help minimize the adverse impact of LDCs’ zero duty status on their exports.
In the services sector, about 150 categories have been identified, including, banking, insurance, engineering and other consultancies. Developed countries want developing countries to include 90 categories of the services sector in the first stage and they would be including 130 categories. However, a final decision is yet to be made, he added.
Dr Manzoor said that some positive move had been witnessed ahead of the 6-MC moot. He said 70 per cent of the issues had to be resolved in 2005 and the remaining 30 per cent next year. He added that time was running out as during the last six WTO rounds of negotiations, things started slowing down after the Doha development round.
“Once we succeed in lowering international tariffs, the benefits enjoyed under free trade and regional trade agreements will also diminish, as most of the nations will provide level-playing fields in exchange of goods and services,” Dr Manzoor noted.
He said Pakistan was an active member of the G-21 which had big stake in agriculture. He said developed countries were giving huge subsidies amounting to around $350 billion per annum to their agriculture sector. If the US gives a three-year credit to its farmers, Australia and Canada have state-owned bodies which provide subsidies to their growers and similar was the case with the EU.
Responding to a question, Dr Manzoor said it was not a question of subsidy or its amount, rather it was an injury caused to other nations that failed to market their products in the world market simply because they could not sell them at lower prices which even did not meet their cost of production.
He said even the most favoured nation (MFN) status would be diluted once international tariffs come down and added: “Even with India we are not keen to open up trade rather move step by step.” During the Ziaul Haq government, he said, Pakistan entered into a preferential trade agreement (PTA) with India and now it was trying to negotiate a free trade agreement (FTA) with India which might not include sensitive items, such as automobile, etc.
Dr Manzoor dispelled the impression that lower tariff rates will hurt the domestic industry and said the domestic electric appliances industry grew many folds after reducing customs duties about four years ago.
M.A. Jabbar, former vice-president of the FPCCI, urged Dr Manzoor to make his working more transparent and said he should also take trade and industry into confidence before finalizing any talks at the WTO.
FPCCI vice-president Akbar Abdullah said that there should be a frequent exchange of views with trade and industry so that country’s interest could be safeguarded at the WTO forum.
