Canada Trade Minister Urges Action on Big Doha Issues

By Sam Cage | July 19, 2010

WTO member states must find answers to bilateral squabbles if they want to achieve any global breakthrough in free trade talks, Canada’s trade minister said Friday.

In an interview with Reuters, Peter Van Loan said he would not point fingers at which World Trade Organization members were holding up the Doha round but warned that political populism could slow progress towards any kind of free trade deal.

“I think the key issue is that some of those countries that are seen as impediments show some movement,” said Van Loan, who was visiting Romania as part of a wider European tour. I really think the focus of those at the WTO has to be to find a way to get critical movement on the key issues,” he said. You need to have a sustained effort in the places where rocks need to be moved.”

The Doha talks, launched in 2001, aim to break down barriers to global trade, but remain deadlocked over differences between the United States and emerging economies.

Washington wants China, India and Brazil to make a bigger contribution to a deal and says talks so far have concentrated on agriculture and manufactured goods, with little progress in services such as insurance and express delivery.

China, India and Brazil retort that with hundreds of millions of their citizens still living in poverty, they cannot give all that it will take to clinch a deal in the Doha round.

The United States and China have accused each other of stalling progress.

“I know that there have been many who have said the answer is another ministerial meeting or ministerial meetings, or making it the major topic of discussion at the G20 conference,” Van Loan said.

“I think that, quite frankly, puts at risk the credibility of the Doha round … I think those trying to advance the agenda would be well advised to be focused in their efforts.”

Canada is negotiating a trade deal with the European Union, which Van Loan said would likely be completed by the end of 2011, boosting trade and investment flows.

Speaking to reporters later Friday via teleconference, Van Loan shrugged off critics who say Ottawa picked a bad time to negotiate with the EU as the global crisis has led to more protectionism and has weakened the euro.

He said a 2008 study that estimated the deal would boost Canadian gross domestic product by €8.2 billion (C$11 billion [US $10.65 billion]) by 2014 was likely overly conservative. “There are a number of factors that don’t take full account of the potential of the agreement,” he said.

“One of the significant assumptions of that study was that the Doha round would have been completed and all of its benefits would already have been accrued. Right now it looks far more likely that this agreement would come into place before the Doha round would reach a satisfactory conclusion.”

Van Loan said there was a tendency among some politicians to use trade disputes to aid their popularity.

“In some ways disputes can serve as an incentive to work towards a resolution, in others they may just politicize and poison the environment and fuel some populist tendencies,” he said. “I think the current political environment in the United States may be a bit more of the latter.”

(Additional reporting by Louise Egan in Ottawa; Editing by Maria Golovnina and Peter Galloway)

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