The collapse of the Doha Round of world trade negotiations is a severe blow for economic development and growth, not only for Australia but for the world.
The Business Council of Australia is very disappointed a new multilateral agreement on trade will not be concluded at this time.
“Courageous political leadership was desperately needed, particularly from Europe and the USA. But no such leadership was displayed,” the Chairman of the BCA’s Trade and International Relations Task Force, John Denton, said.
“The World Bank has estimated that an additional $400 billion could have been added to world economic growth through substantial multilateral liberalisation.
“This is a far-reaching economic opportunity that looks as if it has been foregone,” Mr Denton said.
Multilateral trade negotiations are now compromised for the foreseeable future, given that in 2007 there are elections in France and American Trade Promotion Authority is due to expire, he said.
“A foundation objective of the World Trade Organization (WTO) is to continue the process of multilateral liberalisation of trade among all the 150 countries that are members.
“The WTO also provides an effective rules based dispute resolution framework. It is important that we preserve and build on this aspect of the WTO framework.
“But the WTO cannot be concerned only with dispute resolution. Negotiations to free up markets are vital for future world growth and prosperity.
“But at the moment, when it comes to latest round of negotiations the proof is in the outcome. Doha is a failure.
“Clearly, there needs to be urgent action taken to overhaul how the trade negotiations are structured and progressed.”
Mr Denton said the BCA would seek roundtable talks with Trade Minister Mark Vaile and other interested industry representatives on possible ways to reform the mechanisms in the WTO.
“The multilateral trading system is very important for future economic development and growth. Reforming the system to allow for the Doha Round negotiations to be resurrected and effectively concluded has to be a priority,” Mr Denton said.
“If we do not address the problems within the WTO, there is a risk that progress through bilateral and regional free trade agreements will result in a situation where WTO Members are less willing to participate in the multilateral system. This would not be in the long-term interest of the vast majority of nations,” he said.