Press Release No. 03/150
September 4, 2003
|International Monetary Fund
Washington, D.C. 20431 USA
Declaration by the Heads of the
and World Bank
Next week, trade ministers will gather at
Cancún to advance the Doha Development Agenda. They carry with them the
aspirations of millions around the world whose hopes for economic
advancement rest on opportunities in the global economy. Trade is a driving
force for economic expansion in developed and developing countries alike.
Promoting the growth of trade is essential for global economic prosperity.
And the Doha negotiations are a central pillar of the global strategy to
achieve the Millennium Development Goals: a strategy to reduce poverty by
giving poor people the opportunity to help themselves.
Ambitions for Cancún must be commensurate
with these objectives. We need a decisive break with trade policies that
hurt economic development. Donors cannot provide aid to create development
opportunities with one hand and then use trade restrictions to take these
opportunities away with the other—and expect that their development dollars
will be effective. Developing countries have an important responsibility in
using the multilateral system to promote better integration among themselves
and with the global economy. Their tariffs and nontariff barriers stand as
major obstacles to their mutual trade.
countries have an interest in a successful outcome—and all have a duty to
promote a broad and balanced agenda. But appropriate action by the developed
countries is crucial. In this regard, we applaud the progress that has been
made in negotiating public health exceptions under the TRIPS Agreement and
encourage the parties at Cancún to build on the recent momentum in the talks
is of particular importance to the economic prospects of many developing
countries, and reforming the current practices in global farm trade holds
perhaps the most immediate scope for bettering the livelihoods of the
world’s poor. Yet, developed countries impose tariffs on agriculture that
are 8 to 10 times higher than on industrial goods. Many
continue to use various forms of export subsidies that drive down world
prices and take markets away from farmers in poorer countries. In every
sector except agriculture, these same countries long ago agreed to prohibit
export subsidies. Agricultural support
costs the average household in the EU, Japan, and United States more than a
thousand U.S. dollars a year. Much of this support depresses rural incomes
in developing countries while benefiting primarily the wealthiest farmers in
rich countries, and does little to accomplish the
environmental and rural community goals that
developed countries strive to pursue.
Trade can be a powerful tool for development.
To be fully effective, trade policy should be placed firmly within national
strategies for development and poverty reduction, and be built on a
foundation of good governance. Realizing the benefits of greater trade will
require complementary efforts. On the supply side, this means investments
in infrastructure necessary to ensure that the products of the poor can
reach global markets and, in the longer run, investments in education. And
it means policies to safeguard the interests of the most vulnerable in
society. Both often require external technical and financial assistance.
We are ready to help. All our organizations have stepped up efforts to
provide “aid for trade” in support of a positive outcome of the Doha talks.
Together, we have the mandates, the resources and the expertise to assist
countries in managing the adjustment pressures that can be associated with
more open trade.
But the key challenges now lie with
governments. All have to do their part. Rich countries have to take the
lead in areas now blocking the talks, particularly agriculture. Middle
income countries have to contribute as well, reducing tariffs that affect
not only their own citizens but other developing countries. And low-income
countries, even as they receive more aid for trade and win more time to
implement some WTO rules, have to assume new responsibilities of
participation in the international system.
|Working together the international
community has an opportunity to help the world's poor. We should not let
it slip away.
James D. Wolfensohn
Donald J. Johnston
IMF EXTERNAL RELATIONS DEPARTMENT
Public Affairs: 202-623-7300 - Fax: 202-623-6278
Media Relations: 202-623-7100 - Fax: 202-623-6772