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UN: Benefits May Be Lost Without Textiles

Associated Press
17 December 2005

Up to 15 percent of the benefits of a WTO package of measures to help the world's poorest countries could be lost if textiles imports from Bangladesh and Cambodia are excluded from a final deal, the U.N. said Saturday.

The proposal at World Trade Organization talks in Hong Kong grants duty-free and quota-free access to all so-called least developed countries.

A complete package would bring benefits of up to US$8 billion a year for the economies of the 50 least developed countries, with US$6.4 billion of that attributable to increased exports, said Anwarul Chowdhury, U.N. under-secretary-general for least developed countries, which have a per capita income of less than US$750.

"It means a lot," Chowdhury told a news conference. "Trade is the engine for development."

But the U.S. has raised objections over textile imports from Bangladesh, and Japan also has concerns over rice imports.

A draft agreement circulated Saturday includes no specifics on when the measures would be implemented or what products would be covered.

"They (Bangladesh) are extremely competitive, globally competitive, and that creates an issue for us domestically that I don't think we'll be able to overcome in the next 24 hours," said U.S. Trade Representative Rob Portman.

Chowdhury noted that many of the world's poorest countries, most of them in Africa, have no tradable products for Western markets and urged richer nations to increase so-called "aid-for-trade" donations - money meant to help developing countries to strengthen their trading capabilities.

Chowdhury said half of these donations should go to least developed countries. "This is what I am asking because their needs are the greatest," he said.

The issue of duty-free and quota-free access is a key component of the Doha round, which was launched in Qatar's capital in 2001 and is meant to address the concerns of developing countries, who say they lost out in previous WTO negotiations.

"It would be for almost all products, with the exception of just a few products from just a few countries," Portman said.

Some least developed countries are particularly vulnerable and Chowdhury urged greater protection for those which have no access to the sea, as transporting goods to ports makes their exports up to 50 percent more expensive when they reach developed country markets.

"These countries are losing all competitiveness," he said.

The needs of small island states, such as those in the Pacific, also need to be considered because they are so distant from the global trading system.

"They do not have any negotiating power," Chowdhury added.

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Associated Press correspondent Foster Klug contributed to this report.