EMBARGO: NOT FOR PUBLICATION
BEFORE 19:00 GMT WEDNESDAY
18SEPTEMBER 1996
PRESS/56
18September 1996
DIRECTOR-GENERAL 'SSPEECH TO
EUTRADE MINISTERS INDUBLIN
Attached isthetextoftheaddress delivered byMr.Renato Ruggiero, Director-General,
World Trade Organization, toEuropean Union trade ministers inDublin today
(18September 1996).
96-3689 MOREPRESS/56
Page2/3
"First ofallletmethank Enda Kenny andhiscolleagues intheIrishPresidency mostwarmly
forinviting metomeetwithyouthisevening. Dublin isaspecial place forme.Many years agoit
gavememyfirstexperience ofliving inanother partofEurope. Atthattime, togofrom Naples to
Dublin wasanexotic adventure. Today, young people travel around Europe withtheassurance that
theyareathome. Thefactthatweseenothing extraordinary inthisbrings tolifewhatEurope has
achieved inlessthanforty years tobreak down barriers notonlybetween economies but-most
importantly -between people.
"Opening uptrade wasthekeytobringing thepeoples ofEurope closer together inpeace and
helping them prosper. Itismore andmore doing thesame jobinthewider world. Theenormous
potential ofopentrade within agreed rules tocontribute tohuman welfare isabasic conviction that
underlies everything Iwillsaytoyoutonight, andIbelieve itshould underlie allofourefforts inthe
WTO aswelooktoSingapore andbeyond.
"Astradeministers oftheEuropean Union, youhaveinyourcharge thewellspring ofEurope 's
economic andpolitical success. Ihope youwillallagree thatifitistocontinue torunstrong and
clearitmustbeallowed torunfreely. TheEuropean trade experience gives youaunique chance and
aunique responsibility; totaketheleadinensuring thattheprinciples thathaveworked sowellwithin
Europe arealsoallowed towork welloutside it.Itmustbeallowed toflowstrongly within thebroad
channels oftheWTO 'srules toirrigate notonlyEurope 'sgrowth butthatoftheworld asawhole.
"Your meeting inSingapore inDecember willbeanevent ofworld political significance.
Thedayswhen tradecould bedismissed asanaffair oftechnicians arewellandtrulygone. Thereality
ofglobal economic integration touches livesaround theworld, andbrings withitanintense debate
about itseffects onjobs, onincomes, onsocial standards andontheenvironment.
"This iswhytheMinisterial Meeting mustsendastrong political message. Itmustbeamessage
which emphasizes theopportunities inthenewglobal economy butdoesnotignore thechallenges;
anditmust beamessage ofambition andconfidence forthemultilateral system asitapproaches its
50thanniversary. Ihopethatthemessage willpoint thewaytowards using thisanniversary toreaffirm
theimportance ofthesystem andreassert itsdynamism.
"Itshould beamessage which recognizes thepower ofthemultilateral system asaformidable
engine forgrowth intrade, investment andemployment. Italone cannot solve theproblems of
distribution, butitisessential inensuring thatthere issomething todistribute.
"The message should beoneofunity among industrial anddeveloping countries, andoneof
determination tohelptheleast-developed countries come infromthemargins through boldandspecific
measures.
"Itshould beamessage about universality -theWTO mustbecome aWorld Trade Organization
infactaswellasname. The30accession candidates mustbebrought inassoonaspossible, inaway
which strengthens themultilateral system.
"Itshould alsobeamessage about thevitalrelationship between themultilateral system and
regional trade liberalization. Agreat newwave ofregional initiatives, some spanning continents and
oceans, impels ustolookclosely atthesystemic implications ofregionalism inorder toreinforce the
m.f.n. principle andensure thatregional andmultilateral systems converge around it.
MOREPRESS/56
Page4
"Finally, wehavetosendamessage about ourobjective inthemultilateral trading system.
Itisnotenough tomove forward; wealsohavetoseewhere wearegoing ifwearenottoloseour
way. Canthisobjective beanything other thantowork towards auniversal, freeandopentrading
system based onagreed andenforceable rulesthatwillembrace, notsuppress, thenetwork ofregional
andbilateral trade agreements?
"Ibelieve thatafar-sighted andconfident political message along thelinesIhaveoutlined will
goalongwaytowards keeping theWTO moving intherightdirection. Ofcourse itmustbebalanced
withresponses totheimmediate questions weface,inimplementing existing commitments andinsetting
outtheWTO 'swork programme.
"Itisrightly seenasessential byWTO members thattheMinisterial sendaclearmessage about
thecentral importance offullandtimely implementation oftheUruguay Round commitments. Iwant
tofocus onseveral aspects which show that,while implementation presents agenerally encouraging
picture overall, there areareas which needattention.
"First themajor success story -dispute settlement. Since itsinception, theWTO hasreceived
53formal complaints, andasignificant number ofcases havebeensettled attheconsultation stage.
Twopanels (theGasoline caseandtheJapan Alcohol case) havecompleted theirwork. Currently,
wehavesixactive panels onavariety ofissues. Bothdeveloped anddeveloping countries areactively
using thesystem tosettle theirtrade disputes; thisisamarked change compared tothepast,when
thesystem wasmostly usedbydeveloped countries. Ministers inSingapore canbejustly proud of
whathasbeencreated inthissystem, andwiththewayitisworking.
"Ontheother hand, anareawhere more needs tobedoneisnotifications under theUruguay
Round agreements. Thisisaparticular problem fordeveloping countries, andonewhich callsfor
further attention toappropriate technical assistance measures. Butitisnotonlyadeveloping-country
problem, andIhope allgovernments willtreatitwiththeseriousness itsfundamental importance
deserves.
"Then there isthesituation intextiles. Isuggest thatitisnotpossible totalkseriously about
furthering arelationship ofmutual confidence withdeveloping countries unless theindustrial countries
areready toactcourageously inthissector. There isconsiderable anxiety among textile exporting
developing countries -whoalsoinclude some oftheleast-developed -thatthemajor importers are
notalways living uptothespirit oftheUruguay Round agreement, whatever theirobservance ofits
letter. Thedeveloping countries arenotseeking torewrite therules, buttheyareconcerned tohave
asecond integration phase thatismore commercially meaningful, andtheyareanxious about what
theend-loading ofthecommitments willmean interms ofthepressures importing countries facewhen
theyfinally come tobeimplemented.
"Ithink there isacasetoanswer here, anditisintheinterests ofEurope -including itstextile
producers -tobemore forthcoming.
"Another significant point isunfinished business. Thismeans theservices sector inparticular.
Twofurther agreements havebeenmade since theendoftheUruguay Round, evenifthecoverage
ofthemajor one,onfinancial services, isnotyetcomplete. Improving onthis,andconcluding the
immensely important negotiation ontelecoms, must beatoppriority for1997. Achieving thiswill
bealeapforward forthetrading system comparable invalue toseveral sectors oftheUruguay Round
puttogether.
MOREPRESS/56
Page5
"Here again European commitment andactivism willbeindispensable. Icongratulate mygood
friend Leon Brittan onthekeyrôlehehasplayed sofarinmoving these negotiations forward, and
Ihope hiscontinuing efforts willbewellsupported. These aretruly sectors where wearetrading
intothefuture, andthefuture willnotbekindtothose whofailtokeepup.
"Lastly, implementation alsoincludes thework oftheCommittee onTrade andEnvironment.
Ibelieve thatatSingapore Ministers willbeinaposition tojudge thatagood starthasbeenmade
onintegrating environmental concerns intotrade policy analysis intheWTO, andthattrade andthe
trading system haveasignificant contribution tomake tothepromotion ofsustainable development.
Theresult inSingapore maynotgoasfarassome ofyouwould havewanted, butIhopethattheEU
willplayaleading andconstructive rôleinconsolidating theprogress wehavemade asthebasis for
further work afterSingapore.
"Letmenowturntothethirdessential partoftheSingapore message: themessage ofdynamism
andopportunity wewillsendthrough theWTO 'sWork Programme.
"Byfarthegreatest partoftheWork Programme isalready agreed, inthe"Built-in Agenda"
ofcommitments already undertaken andnegotiations already scheduled. OurtaskforSingapore in
respect oftheWork Programme isinfactneither ambitious nordifficult, since itconsists largely of
agreeing onthemeans ofimplementing theBuilt-in Agenda commitments. Ifwecannot evendothat,
weriskseeing themultilateral system leftbehind bytheadvance oftheglobal economy andofthose
bilateral andregional arrangements which arealready responding toitschallenges. Itisdifficult to
accept thatwhat ispossible inregional fora(such asconsideration ofinvestment issues) should not
bepossible inthemultilateral system.
"Iwanttocover briefly thefiveissues where theproposals thathavebeenmade donotcurrently
come under oneoftheexisting WTO bodies. These arethesubjects onwhich Iampersonally carrying
outinformal consultations. Before Singapore wehavetocome asclose aspossible toaconsensus,
andthismeans building onevery possible element ofcommon ground.
"First, investment. There aresome 1,160 bilateral agreements oninvestment, 31regional
instruments, andeightregional tradeagreements thatcontain provisions oninvestment; ifthecurrent
Members oftheWTO weretobelinked together bybilateral treaties, about 7,500 treaties would be
needed.
"Inrecent times foreign direct investment hasbeengrowing much more rapidly thantrade.
Moreover, salesofforeign affiliates ofmultinational corporations areestimated toexceed thevalue
ofworld trade ingoods andservices (thelatter was$6,100 billion in1995). Whatever theirlevelof
development, allcountries haveaninterest inpromoting astable andattractive investment climate.
Themultilateral system, withitsbroad membership anditswell-established rulesandprocedures, can
make acontribution toimproving thisclimate, every bitasimportant asitsstimulus totrade.
"However, itisnosecret thattheproposal tobegin work oninvestment intheWTO isnot
universally accepted. Some countries oppose anysuggestion ofanegotiation, while others object even
tothecreation ofaWTO Working Group tostudy theissue. These countries point tothemandate
UNCTAD hasreceived toexamine trade andinvestment questions. Their concerns clearly needto
betaken intoaccount. However, atthesametime,theOECD continues toworkonitsMAInegotiations,
inwhich some more advanced developing countries aretaking aninterest.
MOREPRESS/56
Page6
"Thedanger Iseeisthat,without some cleardirection fromSingapore, themultilateral system
could bestuck onthesidelines while some ofthemostimportant future policy influences ontheworld
economy arebeing worked out.Theriskofaconfusion ofcompeting rules andjurisdictions would
beserious; andsowould thesituation ofthose poorer countries whoatthemoment receive practically
noforeign direct investment andwholooktothemultilateral system tohelpleveltheplaying field.
"Oncompetition, asongovernment procurement, Ihavetheimpression thattherearestillmany
significant difficulties.
"Concerning theproposal onWTO Rules, there isaneedforclarification; itisnotyetclear
whether itisahighly political debate thatissought oronewhich focuses thediscussion onafewspecific
rules.
"Lastly Icome tothemostthorny subject, labour standards. Iamgoing, perhaps, tosurprise
youbysaying thatIseerealprogress towards understanding inthisareacompared withwhere we
were afewmonths ago. Specifically, Iseetheemergence offourareas ofcommon ground:
Therespect ofcorelabour standards hasbeenagreed byallMembers intheUniversal
Declaration onHuman Rights;
Alldelegations haverecognized theprimary rôleoftheILOininternational labour
issues;
Thecompetitive advantage oflow-wage countries hasnotbeencalled intoquestion;
and
No-one hasopposed statements bymajor proponents oftheissue thattrade sanctions
arenotenvisaged.
"However, Iwould beshirking myresponsibility ifIpretended toyouthatitwillbeeasyto
agree evenastatement based onthese fourpoints. Some delegations argue thatareference tothese
principles could beusedbyothers asajustification forunilateral measures. Others areasking why,
ifwearenotenvisaging trade sanctions andnotquestioning competitive advantage, weshould bring
thisissue toanorganization which deals withtrade problems onacontractual basis. AndImusttell
youthatasizeable number ofdelegations strongly oppose anyfollow-up intheWTO.
"There remains, inshort, aproblem ofclarity which those whowanttoseethisissuediscussed
intheWTO cannot afford toignore. Thestrong suspicion remains among many WTO Members that
thisisaconcern notsomuch tolimitlabour abuses astolimitcompetition from low-cost imports.
"Ihavetocallyourattention tothegreatimportance ofacting inawaythatwillprove beyond
anydoubt thatinraising thisissuethereisnomajor objective otherthanimproving corelabour standards
andthesituation ofchildren andother vulnerable sectors oftheworking population.
"This would require acomprehensive, positive effort toimprove thesituation ofchildren and
othervulnerablesectorsoftheworkingpopulation,especiallyopeningupopportunitiesthrougheducation.
Clearly such aprogramme must startbymaking thefullest possible useoftheinstitutions and
programmes which already existandarealready dedicated tothese issues. TheILOisfirstamong
these, ofcourse. Through programmes suchasitsInternational Programme fortheElimination of
Child Labour itoffers ways ofproviding incentives andassistance toaddress specific problems. I
amsurethatwehavenotreached thelimitofthesepossibilities, norofwhatcanbedonethrough other
organizations, liketheWorld Bank andUNICEF, andthrough bilateral efforts.
MOREPRESS/56
Page7
"There canonlybeonereason forraising thisissue, andthatisconcern forthehuman beings
involved. Onlyanapproach which isunequivocally grounded inthisconcern andprivileges positive
ways ofaddressing itcantherefore hopetoattract widespread support. Justpushing fordiscussion
ofthecorelabour standards issueintheWTO isunlikely tobridge thegap,andunless thisgapisbridged
weriskopening upothers.
"The challenge thattheproponents ofaWTO approach faceistoconvince theirpartners that
fundamentally weareallonthesame side: thesideofchildren andvulnerable people. Iftheyfail
todosotheresult -whatever thespecific outcome -willbeatremendous failure.
"Lastly, letmesayafewwords about theprospects forfurther liberalization oftrade. This
subject includes atleastfourspecific points.
Thefirst, which isbased ontheMarrakesh Declaration, istodomore forthemarket access
possibilities oftheleast-developed countries. Since theG7Summit inLyon Ihavebeentrying
topromote theobjective ofcomplete, bound duty-free access forLLDC products andthe
elimination ofimport quotas onthem;
Thesecond istheinitiative onInformation Technology andrelated areas;
Thethirdpoint involves discussion ofanearly preparation ofthenegotiations onagriculture
andservices towhich wearealready committed;
Andlastbutnotleastthere isthequestion ofadding tothese future negotiations afurther
liberalizing effort forindustrial goods.
"Before moving onIwould liketoaddthatinaddition tocreating newmarket access
opportunitieswehavetohelptheleast-developedcountriesenhancetheirhumanandinstitutionalcapacity
totakeadvantage ofthem. Improving theeffectiveness andthecoordination oftechnical assistance
isapriority Ihope ministers willsupport fully. Iamdoing allIcantoincrease theimpact ofour
programmes, incooperation withother agencies andthrough exploring theuseofnewtechnology -
butthere areresource limits, anditisdifficult toaccept thatwehavetorelyonlyonthegenerosity
ofaveryfewdonors.
"IhopeIhavecontributed some points tostimulate yourdiscussion. Icannot emphasize enough
theimportance ofEurope taking aclearposition infavour ofastrong, balanced andforward-looking
result fromSingapore -andtaking itsoon. Thecomplexity andimportance oftheissues Ihavetouched
onleaves noroom fordoubt thatwemustusetheremaining weeks before 9December toreach the
mostcomplete consensus possible. Youshould notexpect tobeabletoraiseandresolve major political
issues attheconference, withallthepressures itwillinvolve.
"The factthatSingapore doesnotinvolve thesortofmajor commitments wefaceattheend
ofanegotiation doesnotmake ourtaskeasier. Intheabsence ofsuchanegotiating environment it
isnoteasytomake outtheconcrete elements ofgiveandtakeonallsideswhich produce agreements.
Wearedealing more withpolitical positions, andquestions ofatmosphere andperception. Insuch
asituation, where thewaytoeventual consensus maybelessclear, itbecomes allthemore important
nottopushparticular positions toofar."
END