Politics & free trade Economics & the war on terror
Lozada, Carlos
POLITICS & FREE TRADE CARLOS LOZADA Economic consequences of the war on terrorism This coming September, the trade ministers and commerce secretaries of more than one hundred nations will descend...
...But it's quite possible in the real and imperfect world of geopolitics...
...In 2001, U.S...
...A deal allowing the poorest countries to produce generic versions of essential drugs was spiked at the last second...
...Look, instead, for a "coalition of the unwilling" to emerge over trade...
...Some leaders from the developing world are already expressing their concern...
...The United States and the European Union remain at odds over agricultural subsidies...
...leaders unwittingly made trade hostage to potentially volatile international feuds, particularly regarding the world's traditional leader on trade matters: the United States...
...In the fall of 2001, financial markets were plummeting, economies everywhere seemed to be sputtering, and the world's lone superpower prescribed trade as an antidote...
...Why has it turned out this way...
...Their task, put simply, is enormous...
...The populations of developing countries-those nations that stand to gain the most from increased global trade and lose the most from further protectionism-are the ones who will get burned.l get burned...
...International good will toward the United States after September 11 has evaporated following the conflict in Iraq, and resentment over that war is likely to jeopardize the coming World Trade Organization talks in Cancun...
...Trade is about more than economic efficiency...
...Why not...
...government has made between expanding trade and fighting terrorism...
...unilateralism in military and security matters could derail progress on economic and trade issues...
...POLITICS & FREE TRADE CARLOS LOZADA Economic consequences of the war on terrorism This coming September, the trade ministers and commerce secretaries of more than one hundred nations will descend upon Cancun, Mexico, hoping to reenergize their ongoing negotiations to liberalize global trade...
...Ever hopeful, Zedillo calls that circumstance "a big opportunity to kill two birds with one stone: put the [trade] process back on track and start mending the transatlantic crack...
...There are countless reasons, no doubt, but part of the explanation, regrettably, lies in the explicit and ill-timed link the U.S...
...The delegates in Doha-and their home governments-understandably feared that the global economy would enter a tailspin after the terrorist attacks, especially if more such assaults came to pass...
...Yet by linking trade with geopolitics and the war on terror-rather than making the case for trade on its own economic merits-U.S...
...It promotes the values at the heart of this protracted struggle...
...In another major speech at the HE just last May, ardent free-trader and former Mexican President Ernesto Zedillo warned that U.S...
...Over the last year, the global trade agenda has stalled...
...Well, at least they'll sport those new tans...
...Already activists the world over are planning to descend upon Mexico to again voice their not-so-polite disagreement with the rules governing global commerce...
...Such optimism may be unwarranted...
...When the trade delegates gathered in Doha, Qatar, in late 2001, they made major progress in launching a new round of trade talks-the so-called "development round," since their stated objective was to make trade work for poor nations and to create a stronger link between trade and economic growth...
...Trade Representative Robert Zoellick was unapolo-getic about establishing this connection...
...The riskiest scenario would be one in which those offended by American aggressive unipo-larity express their resentment by withholding their cooperation on the many economic issues that cannot be addressed by the United States alone," cautioned Zedillo...
...Why have the prospects for further trade opening deteriorated so quickly in such a short period...
...What will happen after September, when the delegates show up in Cancun for five days, fail to push the trade agenda forward, and then go back home...
...Secretary of State Colin Powell also expressed himself on the subject, referring to expanded trade-promotion capabilities as "an essential part of our diplomatic tool kit" in America's new war...
...Can the world expect Washington and Paris to suddenly set aside their bitterness from the Iraq debate to make meaningful progress-and mutual concessions-on trade...
...In a speech on September 24, 2001, at the Institute for International Economics (HE) in Washington, Zoellick vowed that "today's enemies will learn that America is the economic engine for freedom, opportunity, and development....To that end, U.S...
...authorities used global good will following the attacks of September 11 to help bolster international trade negotiations...
...In an ironic twist, new transatlantic antagonists such as France and the United States must work together to make the trade talks succeed, since both nations are pivotal in any discussion of agricultural subsidies, which in turn is a major stumbling block in these negotiations...
...leadership in promoting the international economic and trading system is vital...
...Instead, they will likely walk away with little more than a suntan...
...That strategy, so expedient two years ago, is now backfiring badly...
...Admittedly, this would be a lose-lose scenario and is therefore unlikely to occur in the abstract world of rational and perfect information economics...
Vol. 130 • July 2003 • No. 13
