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Can’t act suo motu against US protectionism, says WTO

india Updated: Feb 10, 2017 17:52 IST
Mahua Venkatesh & Sanjeev Ahuja

Amid apprehensions over US President Donald Trump’s new economic policies which many fear could lead to protectionism, World Trade Organisation director general Roberto Azevedo (in picture) says the WTO cannot act on its own.(REUTERS File)

Amid apprehensions over US President Donald Trump’s new economic policies which many fear could lead to protectionism, the World Trade Organisation (WTO) said it cannot act on its own, but in case of a violation, a member could raise the issue.

“What can the (WTO) secretariat do?” WTO director general Roberto Azevedo said, when asked about the issue.

“If the member feels that there has been a violation of WTO rules, then they would challenge… it is a legal system,” he said, adding that at this point, most of these concerns are presumptions.

On the issue of public stockholding for food security purposes, Azevedo, who was on a two-day trip to India, said his secretariat has little power to act on its own.

“It is not in my power. It is the members. All you need is a red flag from a member. I can’t push the members to do what they don’t want to do. You have to convince others as to why you are doing it. You have to explain,” he said.

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India and other countries intend to create public food stocks for food security purposes, but many countries and the WTO have opposed this, terming it a trade barrier.

India wants a permanent solution to the issue instead of the peace clause that is in place now.

Azevedo said one has to be patient for a permanent solution and asked not to undermine the efficacy of the peace clause. “The peace clause raises awareness,” he said.

Under the peace clause, which is temporary in nature, countries can have their own food security programmes even if their subsidy breached the specified limits under the WTO framework on agriculture.

India’s concern is that if the clause expires before a permanent solution is put in place, the legal protection for the food security programmes and policies such as minimum support prices aimed at protecting farmers, could become void.

Meanwhile, several civil society groups met Azevedo in the capital to convey their concerns related to the current negotiations at the WTO, especially those on agriculture.

“The process being currently followed at the WTO is opaque and does not respect multilateralism,” said Ranja Sengupta of the Third World Network.

Sengupta said negotiations must be done in a fair and transparent manner where all countries, rich and poor, can participate equally and uphold the rights of their people.

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Azevedo compared protectionist measures rolled out by various countries during the Great Depression of 1930s.

“In the 1930s... there was no multilevel system, rules…there were unilateral actions which were responded by other members and we ended up in global trade war which wiped out two-thirds of the global trade. Today we have multilevel system, we have rules and discipline. Rules have tools to deal with issues like unfair trade, abuse by others, and not only WTO members can use those tools,” he said.

At a separate function, Azevedo said that if India has concerns over the recent development of H1B visa ban, it can move the WTO. The ban on H1B visas will particularly impact the Indian IT companies that have businesses in the US.