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U.S. Must Maintain Open Economy Says WTO

The United States remains a leading driver of the global economy and a key player in talks on liberalizing global commerce, but there are concerns that Washington could get sidetracked by bilateral trade deals, the WTO said on March 22.

The WTO said that it was important to keep the U.S. economy open "by pre-empting possible protectionist sentiment".

The report said that Washington had made a "stated priority" of its involvement in the Doha Round of WTO negotiations, which were launched in 2001 with the aim of cutting barriers to trade. The talks, which have been running well behind schedule because of enduring discord among governments, are meant to conclude by December.

A domestic U.S. deadline has increased pressure on all 149 WTO members: on July 1, 2007, the U.S. government loses its special authority from lawmakers to fast-track trade deals, which could slow down the WTO negotiations if they over-run.

Trade analysts have raised concerns about Free Trade Agreements (FTAs) among some WTO members that side step the 149-nation negotiations. These deals have allegedly created a "spaghetti bowl" of cross-cutting trading interests which do not necessarily coincide with those of the full membership.

Washington had just three FTAs in 2001 but the total had reached 15 by the end of 2005, including the NAFTA accord with Canada and Mexico, and deals with Australia, Chile, Israel, Jordan and Singapore. A further 12 FTAs where under negotiation at the start of 2006, said the WTO.

The report sounded a warning: "However, the increasing number of FTAs in which the U.S. participates raises concerns about administrative resources being distracted away from the multilateral system, trade or investment diversion, and interests being created that could complicate multilateral negotiations."

Copyright Agence France-Presse, 2006

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