January 27, 2009 / 9:38 PM / 11 years ago

World trade deal would ease economic crisis: WTO

LONDON (Reuters) - Reaching a global trade deal would be a relatively easy way to help ease the economic crisis, the head of the World Trade Organization (WTO) said on Tuesday, adding he believed agreement was possible this year.

“The Doha round (of trade talks) is a low-hanging fruit in terms of what has to be done in order to cope with this crisis and in order to mitigate its effects, notably on development,” WTO Director-General Pascal Lamy said, using a phrase meaning an easy target.

The Doha round was launched in late 2001 to boost world trade and help developing countries export their way out of poverty, but negotiators have so far failed to clinch a deal.

“We’ve got a package on the table which is 80 percent of what needs to be done. Let’s keep focused on completing the remaining 20 percent,” Lamy said in an interview with Britain’s Channel 4 television.

He said it would take a little time for the new U.S. administration of President Barack Obama to be “up-and-running” on the trade negotiations.

Some in the U.S. business community have voiced concern that longstanding trade priorities such as finishing the Doha round will be put on the back burner while Obama and Congress focus on restoring U.S. economic health and other domestic concerns.

Lamy said he would do his best to “fulfil the collective determination of WTO members, which is to try and finish this (the trade round) this year,” he said.

“I believe — with some remaining uncertainty on the U.S. position ... — I believe it remains possible,” he said.

Lamy also warned countries against a protectionist response to the economic downturn.

“You have to work on this collectively, you have to consult with others and you have to abide by the rules of the international system,” he said.

“Let’s not forget what ... happened when beggar-thy-neighbor policies were put in place,” he said, referring to the 1930s Depression.

“It was a mess. Let’s not make the present mess even worse (by resorting) to this sort of policies,” he said.

Reporting by Adrian Croft; Editing by Elizabeth Piper

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