Press Conference by Director-General of World Trade Organization

20 September 2010

Press Conference by Director-General of World Trade Organization

20 September 2010
Press Conference
Department of Public Information • News and Media Division • New York

Press Conference by Director-General of World Trade Organization


Despite the global economic and financial crisis, the world trade system had remained open, with only minimal protectionist slippages, Pascal Lamy, Director-General of the World Trade Organization, said today.

“As we all know, the media doesn’t like speeches, they like news.  This is why I decided to come to New York with a speech for the United Nations General Assembly, but with news for you,” he said at a Headquarters press conference this morning.

Regarding recent revisions of the World Trade Organization’s trade forecast for 2010, he said the numbers stood at plus 9.5 per cent growth in the volume of world trade, in stark contrast to those for in 2009, which showed a minus 12 per cent drop in volume.  The recently revised figures now predicted growth of plus 13.5 per cent for 2010, he said, describing the revision as an important one that, overall, should be considered as good news.

The reason for the positive numbers was that the world trade system had remained open, contrary to many expectations, he said, recalling the predictions of two years ago.  Protectionism remained “the dog that did not really bark”, he added.  A second reality behind the new numbers was that they were working to the benefit of developing countries, he said.  While the overall average volume increase was 13.5 per cent, that number was more like 11 per cent in developed countries and 16.5 per cent in developing ones.  A large part of the volume growth had involved South-South trade, he said, noting that the crisis had revealed the dynamism of that pattern much more clearly than before.

He stressed that trade disciplines had prevented the expected surge in protectionism, demonstrating how it was all the more important to improve such disciplines since the crisis would probably not be the last of its kind.  Such regulations were absolutely essential for developing countries, he said, pointing out the need for systems with properly enforced rules.

Asked his opinion of a “seemingly increasing trend” towards export controls — such as the Russian Federation saying it would not export wheat and India saying it would not export cotton — Mr. Lamy said that while disciplines for import restrictions were strong, restrictions on exports remained much shallower.  He also noted that India was a member of the World Trade Organization, while the Russian Federation was not.  Noting, in addition, that export restrictions had been discussed in one part of the Doha Round of negotiations, he said that, while that was probably an issue for the future, it was not for him to make such decisions.

Questioned about how the World Trade Organization was contributing to attainment of Millennium Development Goal 8, he said there were many issues, such as access to medicine and technology and women’s rights, that expanded the trade body’s influence beyond just Goal 8 regarding a global partnership for development, but with regard to that particular target, there had been “amazing results”, because countries that had opened up their trade more than others had enjoyed accelerated growth and poverty reduction.

Asked about a complaint filed by Japan against Canada over the renewable energy act, he said he was statutorily forbidden to “have any thinking” on disputes.

In response to a question about the possibility of restructuring the trade body to equalize the balance of power between large and small economies, the Director-General said the World Trade Organization was not perfect and he had “never said it should not evolve”.  Compared to “other animals of this species” of international governing bodies, it had a reasonable track record for its 60 years, but that did not mean that the United States and Tonga, or China and Vanuatu carried the same weight.  However, smaller and less powerful members had now learned to co-align, and there was “no way big elephants can push decisions through”, he added.

To a query about the improvement in trade over the past two years since the financial crisis, he replied that the forecast numbers he has just given were evidence that the world trade system had remained open or 2010 would not have seen such a big jump in volume.

“Does this mean we are out of the woods?” he posed.  “No, but we know where protectionist temptations derive from: unemployment.”  While joblessness remained high, protectionist temptations would remain, and the World Trade Organization would remain vigilant in addressing macroeconomic imbalances.

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For information media • not an official record
For information media. Not an official record.