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Wednesday, 14 November, 2001, 15:58 GMT
Q&A: Why trade talks matter

Trade ministers from 142 countries have agreed a deal to launch an ambitious new trade round at talks in the Gulf Arab state of Doha. BBC News Online explains why it matters for all of us.

Why does the deal matter?

World trade has been the fastest way to boost economic growth over the last 50 years, raising the standard of living of many countries.

Part of the reason has been the steady reduction in trade barriers which make it cheaper to sell goods around the world.

But plans to extend trade liberalisation stalled following demonstrations in Seattle in 1999.

World leaders hope, that with a dramatic slowdown in the world economy underway, made worse by the events of 11 September, starting a new round of trade talks will boost economic confidence.

Will anything happen immediately?

Not really. The current deal in Doha is about the agenda for a new set of trade talks, which will now begin in January 2002.

But the plan is for an expanded range of issues to be considered by trade ministers, covering such areas as trade and environment, trade and investment, and the traditional areas like trade in manufacturing products and agricultural goods.

Eventually, the deal could mean that there is a big expansion of free trade around the world.

However, some developing countries have won more access to Western markets, especially for textiles, based on previous agreements, which will come into force earlier.

Will poor counties benefit?

One of the aims of the Doha trade round was to provide more benefits to developing countries.

They have gained the right to bypass patent protection for drugs needed to fight health emergencies, and may gain more access for their agricultural products if talks proceed as planned.

But many developing countries are worried that some of the new items on the trade agenda might be difficult for them to deal with - although in some cases they will have the right to opt out.

Who is the big winner?

Unexpectedly, it is the European Union who appears to have gained most from this trade deal.

That is because it was the EU who wanted to widen the range of topics discussed to include such items as environment (where many Europeans feel strongly) and investment (where European companies may now gain the right of equal treatment in relation to US multinationals when investing in developing countries).

Before the talks began, many people thought this was far too ambitious.

In return, the EU has had to make some concessions on its highly protected agricultural sector.

However, it has limited the damage with a qualifying clause that does not commit it to zero subsidies.

Is it good for the environment?

In the past, moves to protect the environment have been ruled out of order because of trade legislation.

For example, countries trying to stop the import of shrimp caught in a way that damaged turtles could be told this was illegal under WTO rules.

Now the EU has won the right to examine the relationship between trade rules and environmental protection laws.

The EU will also be able to press the case for environmental labelling to tell consumers, for example, that imported timber has been produced under environmentally sound conditions.

See also:

14 Nov 01 | Business
Triumph for world trade talks
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