The United States will not let objections from major emerging economies such as China, India and Brazil stop it from pursuing a services trade agreement within the World Trade Organization, a top U.S. trade official said on Friday.
The real world choice that we face is do we paralyze everything in Geneva for whatever period of years is necessary while we wait for those guys to be ready to talk, or do we do something else in the meantime, U.S. Ambassador to the WTO Michael Punke told reporters.
Obviously, our view is we should pursue market opening however and whereever we can and we should not simply allow the whole system to be paralyzed, Punke said.
With the ten-year-old Doha round of world trade talks dead in the water, the United States and 15 other WTO members, including the 27-nation European Union, have been exploring the idea of negotiating a pact to reduce trade barriers in finance, insurance, banking, media, telecommunications, express delivery and an array of other services sectors.
Some major emerging economies have objected to the effort, saying it would undermine the Doha round, which has sought to liberalize trade in services, manufactured goods and agriculture and includes other components aimed at helping the WTO's poorest members benefit from increased trade.
There's a lot of hypocrisy built into that suggestion (of undermining Doha) because of course what virtually every member of the WTO is engaged in is negotiations outside of the multilateral 'single undertaking' context, Punke said, referring to bilateral and regional free trade agreements that have proliferated in recent years.
Single undertaking refers to a longstanding principle of the Doha round that no individual issue is resolved until all issues are resolved, a negotiating approach that Punke said the last decade has shown has failed.
Although launching negotiations within the WTO typically requires the consent of the entire membership, the United States believes the rules allow a sub-set of members to forge a free trade agreement in services as long as the pact covers substantially all trade in services.
The current initiative meets that test because everything's on the table, including potentially sensitive issues for the United States like increased business visas for foreign service professionals, Punke said.
Washington's long-term hope is for other WTO members to eventually join any services agreement. But Punke emphasized the United States is pursuing the talks on their own merit and not as part of a grand strategy to save the Doha round.
Technical experts from the 16 WTO members will meet again in Geneva on March 18 for further discussions on launching talks on the so-call plurilateral services pact.
The diverse group also includes Japan, Switzerland, Norway, New Zealand, Australia, Canada, Chile, Colombia, Singapore, Pakistan, Taiwan, Hong Kong, Mexico and South Korea.
There is no question that I think everyone's preference is for the emerging economies to be part of all the discussions we have in Geneva because those are the markets that everybody is most interested in. That's the fact, Punke said.
The other fact is that those guys don't want to talk right now and we know that because we have been trying to engage with them intensively for two years, he said.
(Reporting By Doug Palmer; Editing by Vicki Allen)