Multilateral Trading System is Dead : Bhagwati
New York, September 27, 2013
"The multilateral trading system is dead and the Doha
round is in trouble largely because of lack of US
leadership" said Jagdish Bhagwati, University Professor,
Columbia University, while delivering the 10th CUTS 30th
Anniversary Lecture at New York.
According to Bhagwati, the Doha Lite deal being
attempted in Bali, is like a decaf and light coffee and
we are trying to save the Doha round, which is similar
to the steps taken to save the Cancun round on climate
change issues.
He said that the multilateral negotiations are crippled
and they received another blow by the formations of the
regional and bilateral deals. These are all very big
deals--they're not small bilateral deals that privilege
a small number of countries and discriminate against
everyone else. Their preference areas are very large,
and they overlap. And they're all following a similar
model in terms of a comprehensive trade agenda, though
they have different regional perspectives.
"Let us make sure that we don't harm the weakest among
us in the trading system, because the countries that are
left out of these super-regional arrangements are the
African countries, a few Asian countries, and some Latin
American countries" he said. "Thus, the important
question to be pondered over is that the preferentials,
such as Trans Pacific and Trans Atlantic, are the only
game in town and how does it impact the WTO".
Also speaking on the occasion were Eleanor M Fox,
Professor, New York University School of Law; Ken
Davies, Vice Dean and Professor, New York University
School of Law; and Merit E Janow, Dean, Columbia School
of International and Public Affairs chaired the session.
Trevor Morrison, Dean, New York University, School of
Law; Peter Henry, Dean, Leonard N Stern, School of
Business, New York University welcomed all the speakers
and guests at the well attended event.
Professor Fox briefly spoke about the importance of
competition policy and law on development. According to
her, competition law and policy is one among several
links in the chain, all necessary links, to empower the
less and least well off. It empowers the institutions to
knock down barriers and remove restraints which impede
the opportunities to the poor.
She referred to the work undertaken by CUTS through the
7Up initiative i.e. Bottom Up Approach and mentioned
about the various reports that have been produced which
provide evidence from across the globe on how
anti-competitive barriers are created, so as to deprive
the common consumers and producers from participating in
the economy.
"Barriers can be created by various means and
mechanisms, such as cartelization, public and private
restraints and thus, it is important to empower the
institutions to tackle such barriers. This, is one the
key roles played by Competition Policy, which empowers
people and institutions to access and benefit from
economic opportunities, by bringing down such barriers"
she emphasised.
Professor spoke at length regarding the important role
that can be played by competition policy. One important
aspect that she touched upon was that well-functioning
markets are important for pro-poor growth. Market
failure hurts the poor disproportionately and the poor
may be disadvantaged by the terms on which they
participate in markets. Thus, programmes are needed to
ensure that markets that matter for their livelihoods
work better for the poor and policies, such as
Competition Policy to tackle market failure should be
aimed at increasing economic capabilities of the poor.
Kevin Davis briefly spoke about the importance of
tackling corruption. He emphasised that it is extremely
important for organisations such as CUTS to be directly
involved in issues pertaining to corruption. Given the
engagement of CUTS with policymakers and at the
grassroots, the organisation is well placed to take on
corruption related issues, as it requires mobilization
of people at the ground level and having the reach to
the policymakers at the top.
He highlighted some of the actions being taken at an
international level, with the passing of the
Anti-Bribery Law in the UK, followed by a large number
of countries, OECD’s efforts, International Anti-Money
laundering law, UN Convention on Corruption etc.
Davis stressed on the need to work on corruption issues,
as because investors use indicators such as global
indicators for corruption, when taking decisions on
whether to invest in a country or not. Thus, it is
important to take cognizance of such issues and there is
the need to think on what one can do about the same.
There was a lively Q&A session, when numerous micro and
macro issues were raised by the over 80 participants in
the hall. One interesting question was raised on how
climate change issues can be dealt with under the
competition policy rubric. In response, Pradeep Mehta
pointed out that competition not only promotes good
governance but also innovation which leads to a reduced
burden on environment, as firms innovate to produce
goods and services at the lowest costs. "We are engaged
in case studies to show the linkage between competition
policy and climate change".
Professor Merit Janow, in the chair’s summary, recalled
her old association with CUTS and said that the event
which has featured three eminent speakers on various
governance aspects of developing countries will help
take the CUTS agenda forward.
Marking an end to the session, Mehta in his remarks
highlighted the important work being undertaken by CUTS
in the areas of trade, regulation and governance, which
will continue to guide the organisation’s agenda over
the future.
For further information please contact:
Udai S Mehta, +919829285926 or +12022584856,
usm@cuts.org