Contact:
Damian Milverton (202) 473-6735
Dmilverton@worldbank.org
WASHINGTON, October 30, 2005—Rodrigo de Rato, Managing Director of the International Monetary Fund, and Paul Wolfowitz, President of the World Bank Group, issued the following statement today regarding the World Trade Organization's Doha Round negotiations:
"WTO member governments have the chance to move collectively toward more open markets, lifting millions of people in developing countries from poverty and boosting growth in rich and poor countries alike. This opportunity may be lost in the coming days unless key governments face down interest groups that would perpetuate high trade barriers benefiting relatively few at a cost to many. Failure would cast a shadow over the multilateral trading system and further embolden protectionists, at a time when the world needs cooperation rather than conflict.
It is clear what needs to be done. At the heart of the Doha Round lies agriculture, and appropriately so. The sector remains riddled with trade distortions that penalize consumers everywhere and the many poor in developing countries who earn their living from it. Comprehensive and sharp reduction of tariffs in the largest countries will deliver the greatest development gains. Trade-distorting subsidies must also be cut, however, and not simply through technical maneuvers.
Agriculture, important as it is, should not have a monopoly on this Round. The growth potential in other sectors is at least as large. All countries stand to make real gains from removing high tariffs that sap their competitiveness, and from reforming the inefficient services that act as brakes on their own development. Active and fruitful negotiations in services and manufactures are not simply a question of self-interest; they are essential to maintaining the balance of all countries' interests in the negotiations.
Ambitious market opening in agriculture, services and manufactures must be accompanied by significantly increased aid for trade to help the poorest countries take advantage of new opportunities and cope with any adjustment costs. The Bank and Fund are working with donors and beneficiaries to make sure that more and more effective aid for trade is ready to support a Doha outcome.
We urge all Doha participants to remember that trade reform is not a zero-sum game. It is a step toward enhanced opportunity and productivity that benefits all, and that can make a durable contribution to poverty reduction around the world.
Some important progress has been made in the last few weeks. Success will now require key players to set aside their narrow interests, show flexibility and forge the ambitious Doha outcome that the world expects and needs. The stakes are too great to contemplate failure."
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