Bilateral trade deals not good for developing Asia: UNESCAP
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Bilateral trade deals not good for developing Asia: UNESCAP
14 December 2005
Bangkok - The proliferation of bilateral trade deals among Asian countries is an undesirable fallout of the slow progress in global trade talks and against the interests of the poorest countries in the region, according to the UN Economic and Social Commission for Asia and the Pacific (UNESCAP).
Nearly 50 bilateral and regional preferential trade agreements are either in place or being negotiated among Asian countries largely as a result of the hold up in the global multilateral trade negotiations under the World Trade Organisation (WTO).
However, senior UNESCAP officials and experts believe that this works against the poorest countries in the region which lack the negotiating power to enter into such arrangements.
’’A multilateral system is better as even the LDCs (least developed countries) can gain. Bilateral deals leave out the LDCs, creating a rich man’s club (of trading nations),’’ UNESCAP Executive Secretary Kim Hak-Su said today while releasing the UN body’s year-end regional economic assessment.
According to the chief of UNESCAP’s Poverty and Development Division, Ravi Ratnayake, there is a ’’danger of small, poorer and weaker countries being left ouf of the process.’’ Another risk is that ’’WTO plus’’ conditions can be added to the bilateral deals, he added.
This is especially likely when the trade agreement involves one developed country partner. Such an agreement is likely to contain ’’commitments on services, investment, intellectual property, labour and environmental standards which go beyond WTO commitments,’’ observes UNESCAP’s year-end regional economic report.
’’There is a risk that such agreements, while comprehensive in scope, coverage and depth may not yield desired benefits to developing country members due to unequal bargaining power,’’ adds UNESCAP’s Key Economic Developments and Prospects in the Asia-Pacific Region.
According to the UNESCAP survey, India, with China and Thailand, is playing a key role in integrating South with Southeast and East Asia.
India is a member of three regional trading blocs — SAFTA (South Asian Association for Regional Cooperation Free Trade Arrangement), BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation) and APTA (Asia-Pacific Trade Agreement).
India and China are linked only by APTA that also includes Bangladesh, Sri Lanka, Republic of Korea and Laos.
