World Bank chief urges broad global trade accord

Reuters

WASHINGTON (Reuters) - World Bank President Robert Zoellick, in remarks released Sunday, said it was time for countries to get out of their defensive positions on trade and push for a broad agreement that could help the struggling global economy.

In a speech to the World Trade Organization that he is to deliver Monday in Geneva, Switzerland, Zoellick said he was disappointed the global round of trade negotiations, which he helped launch in 2001, might only deliver a deal much smaller than originally envisaged.

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"A mini-deal won't do much for global growth, which is my primary concern," he said. A copy of his prepared remarks was released in Washington.

"I won't sugarcoat it," Zoellick said. "Negotiators from key countries -- developed and developing -- let themselves fold into defensive crouches. Tactical ploys overwhelmed strategic vision and leadership."

He asked WTO members to "think big" and "double-down" on a far reaching global trade deal.

Trade negotiators agreed earlier this year that a deal to significantly open agricultural, manufacturing and services markets around the world was still out of reach.

World Trade Organization Director General Pascal Lamy has urged members to focus this year on a smaller package that would first and foremost help least developed countries.

But even that may be difficult to achieve because two major elements of a proposed smaller deal that could be produced in December are politically difficult for the United States because of opposition from farm and textile groups.

Those elements involve significant cuts in cotton subsidies and duty-free, quota-free treatment for all goods coming out of the least developed countries.

Zoellick, who failed to conclude a Doha round agreement during his four years as U.S. trade representative, urged the Obama administration not to shy away from politically tough decisions that could upset some members of Congress.

Those could include offering deeper cuts in domestic farm subsidies, eliminating a protective tariff on ethanol, changing U.S. anti-dumping rules and allowing more foreign software engineers and other service industry employees to work in the United States on temporary visas.

"Might some of these moves - or others - have enabled the U.S. to get some manufactured or service openings it needs to carry the deal? Could they still? If U.S. negotiators wait for the U.S. Congress to tell them it's OK to close a deal, they'll wait for a long time," Zoellick said.

(Reporting by Donna Smith and Doug Palmer; Editing by Vicki Allen)