NAIROBI, Kenya (PANA)—World Bank President James Wolfensohn
called on developed nations to stop cheating poor countries and to make
good their pledge to reverse protective trade policies that exacerbate
poverty in developing countries.
"The agreement is simple: rich and poor countries have pledged to
speed poverty reduction and progress towards the 2015 Millennium
Development Goals, including urgent improvements in health and education
levels for the world’s poorest people. Action on trade is one of the
best places to start," Mr. Wolfensohn said in a statement ahead of the
recently concluded Annual General Meetings of the World Bank and the
International Monetary Fund at their Bretton Woods Headquarters in
Referring to the commitments made by the rich countries at global
Summits in Doha (Qatar), Monterey (Canada) and Johannesburg in South
Africa in 2001 and this year, he urged the rich countries to show
leadership by example.
"They can lead by example now by reducing tariffs, subsidies,
capricious product standards, protectionist anti-dumping actions and
other impediments to developing countries’ efforts to compete in global
markets," the World Bank chief said.
While the major trading nations such as the United States, Europe,
Japan and Canada have taken steps to improve market access to exports
from poor countries, many of the obstacles impeding such access were yet
to be lifted, he said.
"Tariff peaks—exceptionally high tariffs on goods that poor countries
are best able to produce—can be particularly pernicious. In the U.S.,
tariff peaks are concentrated on textiles and clothing, in Europe and
Japan on agriculture, food and footwear," Mr. Wolfensohn said, adding
that these were precisely the labor-intensive products that offer
developing countries the first step up the technology ladder.
He estimates that tariffs and quotas for textile exports to developed
countries cost developing countries some 27 million jobs.
"Every textile job in an industrialized country saved by these
barriers costs about 35 jobs in these industries in low-income
countries, where being a breadwinner literally means putting bread on
the table," he said, pointing out that the high-income countries’
tariffs on food and clothing raise prices, straining the household
budgets of low-income families.
"Escalating tariffs—duties that are lowest on unprocessed raw
materials which rise sharply with each step of processing and value
added—undermine manufacturing and employment in industries where
developing countries would otherwise be competitive," Mr. Wolfensohn
For instance, he said, escalating tariffs in rich countries have
confined Ghana and Cote d’Ivoire to the export of unprocessed cocoa
beans, Uganda and Kenya to the export of raw coffee beans, and Mali and
Burkina Faso to the export of raw cotton.
The World Bank Chief criticized agricultural subsidies in rich
countries amounting to some $350 billion a year—nearly one billion
dollars per day—that undercut poor farmers in developing countries.