The year 2011 will be remembered for its turbulence and instability, said the director General of World Trade Organization (WTO), Pascal Lamy, in his speech for the opening of the 8th ministerial conference last Thursday in Geneva.
“When WTO member states thought we had turned the corner from the 2009 economic crisis, the outlook for the world economy seriously worsened,” he said.
“High volatility in financial markets and sovereign debt concerns have damaged business and consumer confidence. Global growth is stuttering across nations and, as a result, trade is slowing down. Unemployment remains at unacceptably high levels. The development gains made in recent years are disappearing. In the midst of this tempest citizens from across the globe have taken to the streets to demand stability, fairness, accountability. They are demanding solutions to address the challenges of our interconnected world. As trade has contracted, the multilateral trading system has provided an anchor for national trade policies. It has helped moor them to “our values” of openness, non-discrimination, transparency and rule of law.
But the strong storm waves are loosening the anchor and now risk dislodging it. This would be very bad news. The cost to the world economy of high intensity protectionism would be in the order of USD 800 billion, the estimated value of space or “water” in WTO commitments today.
By improving the credibility of the WTO, by ensuring it keeps moving forward, “you have a contribution to make towards restoring global stability and predictability.”
A freer, fairer and more development friendly trading system is part of the solution. Exiting the crisis will be easier if it is done in the spirit of global co-operation. Going-it-alone will make it more painful and longer.”
