September 15, 2007	Saturday	Ramazan 2, 1428

GENEVA: Countries seeking a global pact to simplify and open up worldwide trade are also forging side deals that make commerce more complex, distort flows and put small countries at the mercy of bigger, richer nations.

Diplomats and trade experts say bilateral and regional accords are creating a confusing web of trade links – often described as a ‘spaghetti bowl’ – that may undercut World Trade Organisation (WTO) efforts to level the playing field for all.

“Regionalism won’t go away. It will continue to spread,” said Eirik Glenne, Norway’s ambassador to the WTO. But such regional-free trade agreements (FTAs) are not the best way to organise world trade, he told a WTO conference this week.

The main objection to such small-scale free trade agreements is that they encourage ties between certain pairs and groups of countries at the expense of others, causing producers to use suppliers that may not be the most competitive.

“The spaghetti bowl falls hardest on the heads of the smallest countries,” said Richard Baldwin, a trade expert at Geneva’s Graduate Institute of International Studies.

Nearly 400 regional and bilateral FTAs are due to be implemented by 2010 and more than 200 are already in force. Only one of the WTO’s 151 member states, Mongolia, is not party to such a deal.

Many export-reliant countries have sought out regional deals out of frustration at the slow pace of the WTO’s six-year-old Doha round of talks, where 151 member states are struggling to agree on ways to lower worldwide tariffs and subsidies.

“The WTO is going in the right direction, but not at the right speed,” Mario Matus, Chile’s WTO ambassador, told the WTO conference.

Matus said Chile, which has signed 20 FTAs with about 60 countries, cannot produce efficiently for its home market and needs secure access for its exports abroad to power its economy. “We’re a young country, we have to go quicker,” he said. “We have to get people out of poverty quicker.”—Reuters