ࡱ>  @ hbjbj "x`    8B^ FEEEEEEE$ GR^IE E E!!!  E!E!!j>0 !Ez p$&{ ND2EE0FD2I Id!E I !Et!pEE $ ! Transcription of DG Press Conference Aid for Trade Second Global Review 7 July at 13.00 Keith Rockwell Ladies and Gentlemen. Good afternoon. Welcome to this 'On the Record' Press Conference with Director-General, Pascal Lamy and Deputy Director-General, Valentine Rugwabiza. I would like to extend a special welcome to our friends from Oman who are here for a seminar for three days. We have specially arranged for Arabic interpretation which will be on channel 4. The Director-General will give a brief opening statement and then will take your questions, we will have about 30 minutes. Monsieur Lamy, s'il vous plait. Pascal Lamy Thanks Keith, so the purpose of this briefing is to give you a heads-up on the main signals from this Aid for Trade Global Review. Although we are only having the wrapping up session with our Members this afternoon, for obvious media timing reasons, you are given a sort of preference, but please do not insist on this with our Members. What both Valentine, who has been the operating part of this Aid for Trade Global Review and myself get from these two days is basically four messages. Number one: trade opening is part of our efforts to stimulate and facilitate the crisis exit for developing countries, and this message was, I think, 100% clear from what the UN Secretary-General said yesterday morning, when he inaugurated this Global Review. As an immediate follow-up of that, Aid for Trade is needed to make trade happen. So we have to keep pushing for making trade possible, but we all know for various reasons, we need Aid for Trade, i.e. more capacity-building support in order to translate this into concrete opportunities for business and for people. Second lesson: despite the downturn, despite fears which we had and which many developing countries had, there is no sign of donors shrinking their future commitments. On the contrary, and I insist, on the contrary, we had a number of individual indications which bode well for the future, even if it doesn't yet cover the whole of the post-'010 agenda. You probably know that we have had aid-for-trade pledges in '05 that '010. We now have to look beyond '010, but we have already collected a number of pledges that go beyond 010. What Japan announced yesterday with the 12 billion '09/'011 which means plus 2 billions as compared to '06/'08 so its not just renewing existing commitments, its 2 billion plus. The UK who announced yesterday that they would spend 1 billion per year over the next 3 years, which is more than what they have done in the past, Netherlands, which is a smaller country, but who announced 550million per year on just Aid for Trade. And this comes on top of the fulfilment of existing pledges. If we look at some examples of who has done what as compared to the '05 pledges US has donated 2.2billion which is 85% of the Hong Kong pledge and we still have '09/'10. The EU Commission and EU Member States are 95%+ of their objective and we are still at '09. And Japan has already donated more than 100% of its Hong Kong pledges, sort of 135%. So, the numbers I gave previously are on top of these numbers, and that was part of the monitoring exercise, tracking whether these commitments are fulfilled or not, and the answer is clearly yes, plus some positive signals for the future. Third lesson: a lot of interest attention on how things develop on the ground, and the three examples which we had decided to focus on which is the North-South corridor in Southern and Eastern Africa, the Great Mekong Delta Region project, and the Mesoamerica project in Latin America which are three examples of what technicians would call transport corridors, but what trade ministers and operators in the ϲʹ call economic corridors, because the pulling effect of putting together these new networks on trade in the region, which most of the case increases regional trade is already obvious in the case of the great Mekong Delta, still to come for the North-South Corridor in Africa which is still at an early phase and already there in some part in the Mesoamerica project. So three good examples of moving from the initial agenda which was the Aid for Trade agenda in '05 to the new agenda which is implementation. Fourth message: some rather clear signals on how we should proceed post this Second Global Review. No. 1: more focus on evaluation, we all know that evaluating the impact of official development assistance, whether it is strictly speaking or whether it is concessional loans is a bit of methodological problem, but obviously we need to poke more into that, so that both donors and recipients increase their ownership and it will be increased if the overall impact on trade growth poverty reduction, gender, mainstreaming and many other issues appears in the evaluation. Second dimension, which we have clearly to focus on in the future is the regional dimension: the lesson of a few years that most of these Aid for Trade programmes or projects is of a purely national nature. Starting, of course, with big infrastructures, whether they are road, rail or energy grids, but this is also true in softer areas like sanitary, phytosanitary standards, trade facilitation for instance, because it is no use if you are a land-locked country opening your borders or booking customs entry point on 24 hour basis instead of closing the border at night, if your neighbour doesn't do it, it is obvious. And then private sector involvement, and we obviously have to do a better job, and we have tried to start discussing this with the ministers and our friends in financial institutions, whether we keep the business involvement sort of decentralized, which is project-by-project, country-by-country, region-by-region, or whether we try and do something which is more visible, which is connected to the ϲʹ monitoring, and we have to think about this. And finally the growing importance of the south-south dimension. Aid for Trade was born in '05 with a mindset which was 'its a north-south issue'. It is more than rich donors giving more money on trade capacity-building to a thousand poor countries. In the meantime, we have seen that countries like China or Brazil, for instance, have stepped in quite vigorously. It is also true in regions like South-East Asia, where for instance, Thailand, Vietnam, Cambodia are shouldering Laos in reforming its trade regime, its trade openness, its ϲʹ accession process, and this south-south dimension is obviously very important, notably in terms of providing technical assistance. Very often countries who have gone through these processes very recently are better at helping those who are still in initial phase to get to grips with the terribly difficult issues. Finally, fourth convergent message, and those of you who attended the opening session with all financial organizations, regional banks, the World Bank; IMF yesterday morning, probably noticed this. Which is this very strong call for the conclusion of the Round, and I think I will borrow the soundbite of Cham Prasidh, who is the Trade Minister of Cambodia when he said yesterday that Aid for Trade and the Doha Round are Siamese twins, you can't separate them, they have only one half, and nobody else than a Cambodian can talk about Siamese twins the way that he did it! Keith Rockwell We will take questions now. If you could give your name and your news organization. Limit yourself to one question and make it brief if you could so that we can take as many questions as possible. First question, John Zarocostas. John Zarocostas Good Afternoon Mr. Lamy. I was wondering Sir, if you could elaborate a little bit on your projections on where do you think the Round is going and when it will finish. We saw some clippings highlighting that the Round could conclude at the end of 2010. That is a radical revision from what we have been hearing from you for quite a long time. If you could elaborate what made you move the end of the Round to the end of 2010, in your assessment Sir. Thank you. Pascal Lamy What is important in terms of when we can conclude the negotiation is not what I say. It is what ϲʹ Members and what negotiators say. That is the real test of their political will, which we all know then has to be translated into negotiating authority and capacity to trade off in order to close the few remaining issues which have to be closed. So I'll probably be able to give you a clearer answer to this question on Friday, after the G8 and the G8+5 discussions on trade. Keith Rockwell Jean-Paul. Vous avez le parole. Allez-y. Jean-Paul Hoareau de Montrose Hier vous avez beaucoup insist dans votre discours d'ouverture sur le rle du secteur priv, vous venez de le souligner encore une fois ce matin. Est-ce que vous pouvez dfinir un petit peu plus largement ce que vous comprenez par le secteur priv? Est-ce que c'est l'institutionnel ou alors c'est vraiment les hommes d'affaires et si c'tait les hommes d'affaires, il va s'en dire que malheureusement dans la plupart des pays qui sont concerns par l'Aide au commerce, notamment les pays d'Afrique, le secteur priv est trs absent pour ne pas dire trs pauvre. Pascal Lamy Encore ce n'est pas ce que nous pensons tous les deux l-dessus qui est le plus important. On est l pour aider, pour driver. Ce qui est sr, et Valentine pourra dire ventuellement un mot de ce qui est apparu hier la session qui a t ddie au secteur priv, la fin du compte tout a c'est pas des tats qui commercent, ce sont les entreprises. Il n'y a pas de doutes sur le fait que le rsultat final il est entre les mains d'entrepreneurs. La question c'est est-ce que dans notre effort de monitoring -- qui consiste exercer une pression politique, qui consiste mettre sur la table suffisamment d'lments concrets de comment les dcisions politiques qui ont t prises se traduisent par effectivement des programmes et du funding -- est-ce qu'on a besoin d'associer dans ce systme de monitoring un composant business? L on a plusieurs choix, on peut trs bien considrer que dans la mesure o tout a dpend normment de ralits locales et o on ne peut pas traiter de la mme manire l'Amrique latine, certaines rgions d'Afrique et certaines rgions d'Asie, c'est une dimension qui n'est prendre en compte qu'au niveau disons national ou rgional. On peut aussi considrer que, et ce sont des suggestions qui ont t faites, par exemple certains secteurs, une approche sectorielle business se prterait assez bien une approche globale. Valentine pourra donner un exemple. Deuximement on nous l'a dit aussi hier il y a un certain nombre de fondations prives qui sont dans l'Aide au dveloppement pour des raisons qu'on pourrait associer aux responsabilits ou autres et qui ont peut-tre leurs moyens. Il faut que l'on creuse a mais votre point de dpart est juste, c'est trs htrogne. Je suis sr que Fedex ou UPS ou toute grande compagnie internationale de shipping va assez vite voir son intrt parce que "Aid for Trade", a marche. C'est peut-tre moins vident mais on a aussi l'avantage de bnficier de l'exprience du Centre du commerce international et Patricia Francis et ses troupes ont t trs prsents dans toutes ces discussions parce que l on a tout prs de nous, si je puis dire, une exprience concrte. Valentine tu veux complter? Valentine Rugwabiza Quand on parle de ce qui est ressortit hier des Membres, c'est qu'en parlant de secteur priv des pays en voie de dveloppement, le secteur priv qui tait cibl tait celui des petites et moyennes entreprises. a c'tait le groupe qui les intressait plus particulirement. Et ce groupe l, il est apparu clairement, que son implication est dpendante de sa propre capacit s'impliquer, tre impliqu aussi bien dans la mise en uvre que dans l'valuation. Et cette capacit est limite par l'accs au financement de ce secteur priv. Et cet accs au financement a t identifi hier dans la session du secteur priv comme un secteur sur lequel il va falloir concentrer les efforts dans les annes venir. Maintenant il est clair qu'il y a aussi un potentiel norme qui reste inexploit comme le disait M.Lamy dans les fondations prives et aussi dans les multinationales qui ont un savoirfaire, qui ont la capacit d'un certain transfert de savoirfaire dans leurs relations d'affaires avec le secteur priv des pays en voie de dveloppement. Cela presse aussi un potentiel explorer qui est assez norme. Les fondations ont, en plus de ce savoir-faire, la prdisposition, si vous voulez, un investissement qui n'aura des retours que sur un long terme. Donc a ce sont des choses sur lesquelles nous allons concentrer nos efforts, faciliter les efforts des Membres au courant des annes venir. Keith Rockwell Yes please, we will take a question right here from the gentlement behind John, and then we will go over to Laura. Question (translated from Arabic) I am from Oman. We are happy to visit here, and to have Mr. Lamy with us. You have spoken about a slowing down in the economy of about 10% and as far as the Aid for Trade that you have spoken about yesterday to what is it directed exactly? Pascal Lamy First my 10% number which is the ϲʹ number is a forecast for trade. The volume of international trade in '09 re-forecast as being minus 10% as compared to the volumes of '08. It is not the gross of the economies, it is the shrinkage of world trade which, for a number of reasons is much larger than the shrinkage of the economies, thank God. Aid for trade is the part of international development assistance which is geared to supporting trade capacity building in developing countries. It starts from the very simple consideration that the core business of the World Trade Organization is opening trade and we do this basically with regulations which our Members negotiate and which together with them we implement, and if necessary litigate, and we have a sort of trade-related technical assistance part that goes with that. That is fine. It creates rules that opens trade and allows our Members to trade on a more level playing field, addressing subsidies, addressing trade defence, and so on. But if you do not have the productive capacity, if you don't have the infrastructures, if you can't reach easily a harbour, which is not jammed, if you have a goal to export mangoes, you can grow mangoes, but if you don't have all these things, you won't export them. So, that is where Aid for Trade comes in, on the basis of projects, programmes, priorities which are country-decided and which then donors the World Bank, the IMF, the European Development Fund, USAID, IMCC, the Japanese International Assistance System have to fund. So, that is what Aid for Trade is about, and the linkage between the crisis and Aid for Trade is obviously that crisis is hopefully short-term and Aid for Trade is medium- long term. This project, these programmes often take two, three, four five years, which is why we have to make sure to insist that the funding of these programmes is not impacted by the crisis, because then it would be a sort of double-whammy for developing countries who suffer already from a crisis they haven't originated, but the exit of which if there own investments are also impacted, the exit of which would be made even more difficult. Keith Rockwell We will go to Laura, and then we'll come over here to this gentleman. Laura Macinnis Hello, Mr. Director-General I wondered whether if you could elaborate somewhat on what your message is to the G8, related to trade and the Doha Round. Could you tell us what is your message in the feasibility of getting a Round concluded in 2010? And if that was going to be the goal then what would you say needs to happen this year, so that that can happen? Pascal Lamy I never answer a question starting with 'if'. Its a rule which I was educated in by Jacques Delors when I was very young you never answer a question starting with 'if'. My message to the G8 will be very similar to my message to the G20 in London, adjusted to what has happened since. On the trade part, and I am specialized on the trade part, I have my views on the rest of the agenda, but that is for others. A keep pushing against protectionist compulsions which we know are there, they have done it reasonably well, although slippages, as evidenced by our monitoring report, and it is no total coincidence that our monitoring report was issued last week it is in order for everybody to assess precisely the situation at the time of the G8. So, be aware that the fight goes on, and that given my own sense that the worse of the crisis in social terms is still to come, which means that the worse of the crisis in political terms is still to come, because it is economic, social, political the stress tests for the ϲʹ system, as a system that prevents high intensity protectionism is still to come. No. 2. if you are serious about keeping trade open please understand, which every trade negotiators know that the best way to keep trade open is to keep opening trade. Hence, the renewed urgency of concluding the Round which is a message which developing countries are now passing unanimously. One of the consequences of this crisis has been that the impact of this shrinking of trade is harder for developing countries than for developed countries for a simple reason which is the proportion of the part of the economy they trade is higher, so inevitably trade has a higher importance than it used to, and making sure that the insurance policy against protectionism is renewed, reinforced which is the basic thrust of the Round, so that developing countries' comparative advantage is better served, has more actuality. Paying a bit more for your insurance policy is something which people often think when the fireman is at the doorstep. It concentrates minds on the real dangers. No. 3 Aid for Trade and I won't repeat the message of this Conference, which is also directed to the G8 and the timing is no total coincidence and fourth, keep oiling trade finance, hence for instance the launching of this Global Liquidity Fund yesterday, together with the World Bank, together with a number of countries with commercial banks, who have stepped in, because short-term, as you all know, its an important problem, notably for emerging countries. So these are my four basic messages. In terms of the timing for the conclusion of the Round, again let's wait for the discussion among leaders, not for me to pre-empt this the day before, or two days before, I'll be there on Thursday and on Friday I will report to them. I will discuss that with them, they will discuss that among them, so let's leave this open for the moment. Keith Rockwell We have time for two more questions. The gentleman here, and then we'll go over here. Please Sir. Question through Arabic interpreter/ Director-General. You have talked about greater finance in the global system in order to encourage to trade, but to make sure of that we should not have a repeat of this crisis that we are suffering from now. Are there any discussions going on with the international and regional organizations to put an end to the repeat of such a crisis. Thank you Sir. Pascal Lamy Well the answer to that is yes, but ϲʹ is not driving this. I think everybody here knows my analysis of this crisis which is that it originated mostly if not only in a lack of international regulation of finance which had hyper expanded and hyper globalized, I understand, and that is what I heard in London when I attended the G20 that G20 leaders, a number of international organizations who are specialised in this whether it is the IMF or the forum for financial stability are working on that i.e. trying to address this hole this big black hole in regulation which we had in the international system which in many ways irrational and I understand that they are trying to do this, but this is not ϲʹ driven. We have an international system where health is regulated somewhere, telecoms elsewhere, labour elsewhere, trade elsewhere. If there has to be a serious finance regulation it has to be elsewhere by the people who know this business and who can negotiate, implement, if necessary litigate, and educate - the rules which they will hopefully hopefully get - but my sense is that we are not yet there. Keith Rockwell Last question please. Shabai Gold You spoke about Aid for Trade, but you also mentioned the social impact and you said that there was a concern that the social impact could lead to some sort of protectionism. What would be your recommendations to the countries that might have this result to make sure that the economic crisis doesn't have a social impact that would then lead to a protectionist backlash.? Pascal Lamy On this my answer is the same as Juan Somavia's answer, although he heads an organization which is devoted to social issues and I am the head of an organization which is devoted to trade issues. When you look at the ILO summit a few days ago here in Geneva, unsurprisingly they had the same position that we have on trade, and the prescription of the ILO on the global agenda is 'fight protectionism and conclude the Doha Round', and so there is probably a bit more coherence in the system than there used to be. Now, seen from where I am, and it is not new I have always thought that there is a close connection between openness of trade and the support by public opinion of opening trade and the quality of social system for a simple reason which is that as we all know, opening trade re-shuffles economic and social fabrics, this is not harmless this is a plus at the end of the day, but like many pluses in life it is a sum of pluses and minuses. And the minuses, including on the social side about qualifications, about compensation, about retraining, about moving from one location to another are there. So, the efficiency gains of international trade are not painless. And if you look at the correlation in public opinion between the quality of social systems and the positive attitude to trade the correlation is absolutely obvious. There are a few exceptions, but the correlation is absolutely obvious. Now, of course then, the question is, who can afford social protection, which is costly which implies re-distribution of systems, regulations, some of which business would say hamper their flexibility because if you have regulation that, you know, you cannot just hire and fire, then this would be seen as a friction in formidably well transparent working market economy. It is the same for unemployment, it is the same for training, education, and so on. At the end of the day, the experience proves that putting together a health system is easier when you are rich than when you are poor. There are a few examples, which I think Valentine knows, in her origin country a country which stepped in vigorously in trying to provide health insurance to its population in a LDC I haven't seen much of that around. So then the question is, and that was the point that Juan Somavia was making yesterday, again in this ECOSOC session which I also attended, we have to care about this side of the crisis, not just in times of crisis, but in normal times, and seen from where I am, the more we can address the social pain of a more efficient world economy, and we will have a bit of that for instance including in environment if, at the end of the day, Copenhagen succeeds in agreeing the burden sharing of carbon emissions, this will impact some industries more than others. This will create green jobs, but it will destroy amber jobs, and this again is not painless. So this linkage in my view is there it is obvious in times of crisis, although some have social safety nets, others do not have, it should also be obvious in hopefully better times, but at the end of the day, for the moment, the best social security for many developing countries is the security of their trade. We would wish that they would have more than that in order to amortize the shock of the crisis that reality for the moment is that this is true for many of them which is why there is a certain urgency, and I think to conclude this Aid for Trade Global Review was clearly marked by this urgency as compared to the first of this kind which we had in November '07, which was in a way calmer. This time people start seeing things happening and they see this as a major contribution to exiting the crisis which I think makes it even more relevant. Thanks for your attention. 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