The Biggest Problem Is Reducing Injustice: Pascal Lamy, in This Interview with Hichem Ben Yaiche, Discusses the Role of the WTO in an Ever-Changing Environment, the Pros and Cons of Globalisation, Protectionism and Unfair Terms of Trade and Africa's Current Status on the World Economic Stage

By Lamy, Pascal | African Business, January 2013 | Go to article overview

The Biggest Problem Is Reducing Injustice: Pascal Lamy, in This Interview with Hichem Ben Yaiche, Discusses the Role of the WTO in an Ever-Changing Environment, the Pros and Cons of Globalisation, Protectionism and Unfair Terms of Trade and Africa's Current Status on the World Economic Stage


Lamy, Pascal, African Business


Today, the world is going through a structural crisis, experiencing a shift of economic powers and the emergence of a new set of operational rules. In this scenario, is the World Trade Organisation (WTO) still relevant? Of course! And what's more, it's in part thanks to the WTO's disciplines and their implementation that this global structural economic crisis has not degenerated into generalised protectionism. The reactions that we are seeing are normal. The pressures are there. And yet I don't believe we're in a world where protectionism protects. It no longer allows jobs to be saved.

Trade barriers have, despite everything, allowed some countries to introduce and strengthen their industrial sectors [before opening up to the world]. I'm thinking specifically about China or South Korea ... I don't think that that's true historically. It may have been true in the 19505 and 196os in South Korea, but definitely not in China. On the contrary, China's economy took off when trade was opened up, through the reforms of Deng Xiaoping. It grew by 10% a year.

What are the real challenges facing the WTO in a global context that is constantly changing?

The WTO's priorities are above all to hold firm during the crisis. We must not go backwards. We must also carry out committed actions. To do that, we must continue to open up trade while improving and adjusting the rules of the game. We must also contribute in helping the developing countries build up their trade capacities.

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With regard to Africa, what exactly is the state of your negotiations with the African governments?

In the past 10 or so years, we have been involved in the establishment of three coalitions within the WTO: the African group, the Least Developed Countries group and the ACP group. But in fact, these three groups operate as a single entity today.

The African group is one that is pushing the hardest for multilateral negotiations to be concluded. Africa holds an important status at the WTO. For that matter, Africa's position is a lot more important within the WTO than it is during bilateral government negotiations. Actually, in bilateral relations, the poorer you are, the weaker you are!

Some African governments have little means. The industrial structure is often in the early stages of development and sometimes nonexistent. Are the decisions to dismantle the trade barriers and open up the borders really the right ones for these countries?

No one is asking Africa to dismantle trade barriers multilaterally today. Africa's priority is intra-African trade, which represents just 10% of the total trade of African countries. In Addis Ababa at the beginning of this year, Africa adopted an ambitious and necessary plan. This has given priority to opening up intra-African trade. That's a very important point. There are one billion men and women in Africa. In other words, that's one billion skill sets. And yet, there is a multitude of micro-economies that are no longer relevant in terms of the global world we live in. Africa must continue to internationalise.

From this point of view, what are your suggestions and proposals?

Today, integrating the African continent as a whole is the priority. The different regional economic groupings--East Africa, West Africa, Central Africa, Southern Africa--are already there.

How are you furthering this process?

Simplifying and making procedures at different African borders more transparent would contribute significantly to easing up the movement of goods and services.

We are working on this closely with UNE-CA, which is based in Ethiopia. This is where there is the most expertise on this subject, together with the AU Commission. For some years now, we have also been working more and more with the Regional Economic Commissions, in particular with those that have shown the most enthusiasm, specifically in East Africa: Kenya, Tanzania, Burundi, Rwanda and Uganda. …

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The Biggest Problem Is Reducing Injustice: Pascal Lamy, in This Interview with Hichem Ben Yaiche, Discusses the Role of the WTO in an Ever-Changing Environment, the Pros and Cons of Globalisation, Protectionism and Unfair Terms of Trade and Africa's Current Status on the World Economic Stage
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