Delegates at the OECD meeting in Paris last weekend hoped to breathe new life into World Trade Organisation talks, writes Gamal Nkrumah The ministerial meeting of the Organisation for Economic Cooperation and Development (OECD) held in Paris was specifically aimed at reviving multinational trade negotiations as well as reviewing the state of the global economy. Fraught with tensions, global trade talks have faltered over disputes between the industrially advanced developing countries of the North and the developing nations of the South. The 30-member OECD is a unique international forum which groups both the world's wealthiest nations and a select number of the leading developing countries. Topping the OECD agenda at this year's Paris meeting which took place 13-14 May were discussions about the political tensions in the Middle East and its impact on global markets and world trade. The turmoil in Iraq and tensions in other parts of the region, and especially the world's largest oil producer and exporter Saudi Arabia, has led to a steady rise in oil prices currently standing at an all-time high of $40 per barrel. The rise in oil prices is also fuelled by strong global demand for oil in rapidly industrialising developing nations such as China and India -- two giant economies that are enjoying unprecedented economic growth rates. There are global fears that a continued rise in oil prices would lead to inflationary pressures in the short term. Surges in oil prices have traditionally had a deflationary impact in the medium and longer terms, though. Indeed, high oil prices have historically preceded the recessions of 1973-74, the early 1980s, the early 1990s and the slackening global growth rates that characterised much of the 2001-2002 leading up to the 11 September attacks on New York and Washington. It is against this background that the OECD nations meeting focussed on oil, trade talks, global markets and the Middle East. Indeed, in an unprecedented development, the promotion of good governance, investment and economic development in the Middle East and North Africa was spotlighted at the Paris meeting. Other issues on the OECD agenda included the enlarged Europe, Japanese economic performance and the economic and trade relations between the US on the one hand and Asia and Europe on the other. Nine months after the collapse of the WTO talks in the Mexican Caribbean resort of Cancun, the developing nations glean a change of heart among the world's wealthiest nations in certain vitally important aspects of trade talks, namely on the prickly questions of protectionism and subsidising agricultural production in the North. EU and Japanese officials and diplomats have signalled that their countries are willing to look into cutting barriers to imports from developing countries and reducing farm subsidies. It is in this context that the OECD hopes to revive the Doha round of trade talks in the near future. Brazil, China and India are three key countries representing the interests of the developing world and are pushing hard for richer nations to end farm export subsidies. India, more so than either China or Brazil, is adamant that it remains self-sufficient in food production. The US, on the other hand, insists that larger more advanced developing countries like Brazil, China and India open up their markets. These problems notwithstanding, there is strong evidence to suggest that both rich and poor, developed and developing nations, are trying hard to improve the atmosphere of the Paris trade talks. Celebrating its 10th anniversary of accession to the OECD, Mexico chaired this year's OECD ministerial meeting in Paris. Mexico is also a member of the Group of 20 Plus (G-20), a loose club of diverse developing nations that lobby for the beneficial integration of economies of the developing countries into the multilateral trading system. The G-20 nations work collectively on the re-orientation of global trade policy towards the interests of developing countries. The G-20 group of developing countries are lobbying hard for the interests of developing world in global trade talks and other international economic forums. The G-20 include a wide range of countries with different levels of economic development and standards of living such as Argentina, Brazil, China, Egypt, India, Mexico, Pakistan, South Africa and Turkey. The G-20 countries complain that the current WTO regime is running counter to the interests of developing countries. But the WTO insists that the G-20 have a pivotal role to play in global agricultural trade. "We should be heartened by a number of positive developments that we are witnessing," said WTO head Supachai Panitchpakdi. "I detect a willingness of the delegations to negotiate with each other and to focus on substance and region and not procedure." He urged compromise by both rich and poor nations. "We should not be under any illusions about the scale or urgency of our task," he said at the start of the OECD global trade talks in the French capital. Developing countries were especially concerned about agricultural subsidies in rich nations that undermine agricultural development in poorer countries around the world. The developing countries demanded in vain that wealthier nations make concessions over farm export subsidies. The wealthy nations, on the other hand, want to see greater emphasis put on the so-called Singapore issues, which include global investment liberalisation, the eventual opening up of all government procurement (public tenders) to international competition and the harmonisation of competition policy. The two-day meeting of OECD ministers in Paris highlights the pressing need to put forward new global trade rules. It also demonstrates that the representatives of the developed and the developing worlds are now willing to compromise in order to save world trade talks. The main reasons for the failure of trade talks in Cancun were disagreements over agricultural policies and related trade issues. The WTO global trade talks held in Doha, Qatar in November 2001 seemed until very recently consigned to the dustbin of history. Global trade talks in Cancun, Mexico, failed to save the Doha trade round. At the OECD meeting in Paris, it was hoped that a little more concessions and compromises would clear the air. A negotiating framework for reviving the Doha round now appears to be close at hand. The WTO Chief Panitchpakdi summed it up by saying: "The atmosphere is pretty positive but we have no real progress for the moment."
