USTR - Free Trade Vision
                 
The Office of the United States Trade Representative

Free Trade Vision
Op-Ed by USTR Rob Portman and Deputy USTR Susan Schwab in The Wall Street Journal 05/01/2006

As expected, the World Trade Organization Doha talks have missed another deadline, this one to establish the framework for reducing trade barriers on goods -- from corn to computers. The U.S. remains committed to finding ways to bridge differences between WTO members, and that is why we're in Geneva this week. We find that most countries share our desire for an ambitious result across the board. Most also agree this is a once-in-a-generation chance to reduce trade barriers and raise living standards, and we cannot allow it to slip away.

As has been the case from the start of the Doha Round four-and-a-half years ago, the U.S. remains committed to an ambitious and comprehensive multilateral agreement to expand trade and promote development. We do not think WTO members should settle for half measures -- or "Doha Lite," as some have called it.

The stakes are high for all WTO member countries, large and small, no matter what their stage of development. Developed countries like France, the U.S., Japan and Germany will benefit by being able to sell their products and services in more markets. A study by the University of Michigan estimated that with the total elimination of trade barriers Europe's annual GDP would increase by 6.3%, Japan's by 6.2% and America's by 5.5%. The potential gains are even greater for developing countries. The World Bank estimates that full liberalization would boost the incomes of developing countries, which comprise two-thirds of the WTO membership, by up to $259 billion by 2015.

Agriculture remains a key to success. It was placed at the heart of Doha in 2001 because of its importance to the developing world and because agriculture has the highest barriers to trade. Over 70% of the poor living in developing countries live in rural areas and depend on agriculture to make their living. Not surprisingly, 63% of the income gains the world's poor would enjoy as a result of a successful round would come from more open trade in agriculture and 93% of those potential benefits and income gains depend on improved market access. The facts are clear. Without new trade flows from reduced tariffs, there is no development in the Doha Development Round.

In order to reach an ambitious result and jumpstart the talks, last October the U.S. offered a bold proposal to eliminate export subsidies in agriculture, make deep cuts in agricultural tariffs and sharply reduce trade-distorting domestic subsidies. This significant and forward-looking proposal carries political risks at home but we believed then -- and we believe now -- that these are risks worth taking given the importance of the round, particularly for developing countries.

Since that time, our trading partners have failed to match that offer with equally ambitious offers, putting progress on additional market opening for industrial goods and services at risk. The U.S. cannot keep its current offer on agriculture on the table -- let alone unilaterally agree to make deeper cuts to our domestic support programs -- without additional and substantial steps by the European Union and other major partners, including those in the developing world, to open their markets. As we have made clear for six months, the U.S. offer was contingent on WTO members meeting the clear Doha mandate for new market access and new trade flows across the board. This means meaningful offers on market access in all three major negotiating areas -- agriculture, non-agricultural goods and services.

A seamless transition in the leadership at the Office of the U.S. Trade Representative underscores the U.S. commitment to the Doha Round's success. The imperative remains for our trading partners to show more resolve in opening their markets. Free trade is at the center of President Bush's vision of a world of expanding economic opportunity, prosperity and freedom. Our pursuit of that vision will continue in an uninterrupted and unaltered fashion no matter who speaks for the president in global trade talks. The U.S. has made a clear choice to stand up to forces of economic isolationism and protectionism. We have chosen to reject the path of least resistance, and of incremental but insufficient changes in the global trading system. It is time for all WTO members to seize this last chance to make the same choice.

Mr. Portman and Ms. Schwab are, respectively, U.S. trade representative and deputy U.S. trade representative.