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Tuesday, 6 November, 2001, 18:11 GMT
Q&A: World trade talks

BBC News Online explains why the world trade talks in the Qatar are crucial for the future of the world economy.

What are these trade talks about?

Countries from around the world are meeting in Doha to try and decide whether to launch a new round of world trade talks.

The idea is to make trade in goods and services easier, thus boosting world growth and income. But the idea of increasing the scope of free trade is controversial in many countries.

Why is the meeting in Doha, Qatar?

The meeting is being held in Qatar because it was the only country that volunteered to organise a meeting after the mass demonstrations during the world trade talks in Seattle in 1999.

Combined with political disagreements, the demonstrations scuppered that attempt to launch new trade talks.

The demonstrators are unlikely to want to, or be able to come to Qatar, a small state in the Gulf which is proud of its links to the West.

What are the obstacles to a deal?

Many poor countries feel cheated by previous rounds of trade talks, which they believe only benefited richer countries at their expense.

In particular they claim that rich countries have not opened their markets to agricultural products and textiles, which they can produce more cheaply.

Meanwhile, the European Union wants to extend talks to other areas like securing the rights of multinationals that make foreign investments. Poor countries object to anything that could infringe their sovereignty.

What is likely to prove most controversial?

Poor countries want an exemption from the new world trade laws covering patents, so that they can produce or buy medicines to fight Aids and other diseases more cheaply.

Rich countries say this would deprive pharmaceutical companies of money to re-invest in research and development of new medicines and ultimately out of business, and want a more limited exemption.

But the United States itself has now invoked such a clause in order to purchase more antibiotics against anthrax itself.

Why are the talks so important?

Many economists, and many world leaders, believe that if the talks fail, it will be another blow to global economic confidence, which is already fragile since the terrorist attacks in the United States.

If that happens, the world could face a prolonged economic slowdown.

In addition, reaching a deal is seen as crucial for ensuring that the Bush administration in the United States re-engages with multilateral agreements and does not lapse into protectionism.

It would reverse the trend that started when the United States said it would not sign the Kyoto climate change treaty.

And launching world trade talks is seen as a key way of gaining allies among the world's poorer countries for the campaign against terrorism.

How much could poor countries benefit?

The World Bank has estimated that free trade could mean an extra $1.5 trillion in income for the world's poor countries over the next 10 years - nearly three times as much as they receive from foreign aid.

And Western consumers would gain almost as much from the reduction of agricultural subsidies and cheaper food prices.

But some development campaigners worry that if poor countries open up their markets too quickly, especially those in financial services and public utilities, they could become vulnerable to instability and job losses, with control passing to Western firms.

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