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WTO chief urges US manufacturers to accept tariff offer
World Trade Organisation Director General Pascal Lamy urged US manufacturers demanding deeper tariff cuts in world trade talks on Friday to consider the billions of dollars of savings that would come from proposals already on the table.
- Reuters
- Published: 22:58 November 1, 2008
Washington: World Trade Organisation Director General Pascal Lamy urged US manufacturers demanding deeper tariff cuts in world trade talks on Friday to consider the billions of dollars of savings that would come from proposals already on the table.
"We understand how important it is to have US companies favourably disposed to the Doha round, and the director general made his case," Keith Rockwell, a spokesman for the Geneva-based World Trade Organisation, said.
Lamy met with the National Association of Manufacturers after a round of meetings on Thursday with US Trade Representative Susan Schwab, Treasury Secretary Henry Paulson, World Bank President Robert Zoellick and International Monetary Fund Managing Director Dominique Strauss-Kahn.
The WTO chief is trying to boost chances of a breakthrough in the nearly 7-year-old negotiations by the end of the year after a July meeting of trade ministers ended in failure.
The powerful US manufacturing group is unhappy with the proposed formula for cutting industrial goods tariffs in the long-running Doha round of world trade talks, which they believe will not provide significant new exports.
'Sectoral' agreements
It has insisted, with strong backing from the Bush administration, that big developing countries like China, Brazil and India participate in some "sectoral" agreements where countries would cut tariffs to zero.
Proposed sectorals include electronics, chemicals, autos and autos parts, machinery, gems and jewellery, fish and fish products, raw materials and toys.
In the meeting, Lamy urged the manufacturers not to discount the value of tariff concessions already on the table under the proposed formula.
Those amount to a $7 billion (Dh25.7 billion) to $8 billion tax cut per year on US exports, he said.
Much of NAM's unhappiness with the formula is that it allows countries to cut tariffs from their WTO-maximum, or "bound" level, which is often much higher than the "applied" rate countries actually impose on imports.
In too many cases, US exporters would get no new market access because the bound tariff cuts are not deep enough to affect the applied tariff, said Frank Vargo, vice president at the National Association of Manufacturers.
"The new market access we get from the formula is inadequate. It's got to be bolstered by good participation in sectorals," Vargo said, even after Lamy presented figures showing 86 per cent of India's applied tariffs would be cut by an average of 14 per cent under the proposed formula.
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