12 December 2005
U.S. Backs Duty-Free, Quota-Free Treatment for Poorest Countries, December 12, 2005 (USTR Portman presses for results from WTO ministerial meeting in Hong Kong)
By Bruce Odessey
Washington File Staff Writer
Washington -- The United States supports a proposal for duty-free, quota-free market access for most products from the poorest developing countries, U.S. Trade Representative Rob Portman says.
At a December 12 press conference in Hong Kong the day before a World Trade Organization (WTO) ministerial meeting begins, Portman said he was working with U.S. trading partners to implement the proposal.
The United States would implement such a proposal through its existing trade preference programs, such as the Generalized System of Preferences (GSP). U.S. Agriculture Secretary Mike Johanns said at the same press conference that the flexibility of those existing programs is essential to U.S. participation.
In order to provide duty-free, quota-free access for textiles from sub-Saharan African countries, for example, Johanns said, the United States might not provide such access to a country that is already globally competitive. He did not identify any country by name.
"We want to instead focus our efforts on those countries that need help in order to be competitive," Johanns said.
Portman reiterated the U.S. position that improving market access for developing countries is the best way to promote development. He cited evidence from international financial institutions showing that the U.S. economy is already the most open to products from the least-developed countries. He added that the United States is the world's biggest spender on trade-related assistance.
The biggest challenge at the December 13-18 Hong Kong meeting remains advancing the core areas of the long-stalled WTO negotiations, formally called the Doha Development Agenda, Portman said.
In services, he said, that means members must offer better access in key sectors such as financial services, telecommunications, computer services, express delivery and energy services.
For industrial goods, he said, that means cutting tariffs sharply and cutting the highest tariffs the most.
Above all, he said, members have to agree on deep tariff cuts for agricultural products with minimal exemptions for politically sensitive products.
"I mentioned the sensitive products area because it seems one area where the European Union [EU] has told us and said publicly that they have some flexibility" by adjusting tariff-rate quotas, Portman said. "So wherever they have flexibility, we would like to probe that and to see what progress we can make."
He chided EU members that have opposed agricultural tariff reductions because they might erode existing EU trade preferences for former European colonies.
In his view, the huge gains from lowering tariffs generally vastly would exceed any harm done to countries having existing preferential treatment. Moreover, he said, an existing International Monetary Fund program provides assistance to just such countries.
"We feel strongly ... that you cannot hide behind preference erosion as a way to protect your own farmers," Portman said. "It’s cynical, and it doesn’t hold up in terms of the economic analysis."
The Doha negotiations have languished almost since they were launched in 2001 over differences about opening agricultural trade. In October, the United States proposed sharp reductions in both agricultural tariffs and domestic support payments to farmers. Analysis of a subsequent EU agriculture proposal shows that it would offer little or no real additional market access. (See related article.)
A transcript of the press conference can be accessed at the Office of the U.S. Trade Representative (USTR) Web site.
For additional information, see WTO Hong Kong Ministerial Meeting.
