EU’s market opening would help recovery: WTO

GENEVA – The strength of the European Union’s economic recovery will be influenced by the extent to which it liberalises agricultural and services markets, the World Trade Organisation said yesterday.

In a biennial review of the EU’s trade policy, the WTO secretariat said the 27-nation bloc should intensify the liberalisation of both its internal single market and wider international trade.’A robust recovery and sustained economic growth in the European Communities (EC) will hinge on it continuing to undertake key structural reforms,’ the WTO said in a statement.EU export growth is expected to slow by more than two-thirds from 2007 to 2009, while the impact of the economic downturn on imports is likely to be even more severe, according to European Commission forecasts cited in the WTO’s Trade Policy Review.The report for the 153 WTO members also highlighted the EU’s influence on the global economic climate, as the world’s leading exporter, the second largest importer of goods, the largest trader in services and as a net investor in the rest of the world.’The EC is expected to continue contributing to making trade play a key role in curbing the current economic slowdown,’ the report said.’To this end, the EC’s steps towards the full establishment of its internal market could be enhanced and its trade regime for agricultural products further liberalised,’ it added.Farm trade in the EU would benefit from a simpler system of import duties as well as cuts in high tariffs and ‘incentives’ for products, the WTO said.About 46 per cent of the bloc’s expenditure was on its Common Agricultural Policy in 2006, according to the report.While the EU’s overall tariffs on agriculture, hunting, forestry and fishery produce have come down slightly since the last review, agricultural products ‘remain protected’ and still receive export subsidies, it said.Meanwhile, services – the ‘backbone of the EU economy’ – remain ‘the priority as regards the creation of a genuine internal market by the end of 2009.’Although reforms to telecommunications, financial services, post and transport were underway, the WTO noted that there was still no ‘comprehensive’ approach to many other services within the bloc, including tourism, distribution, construction and employment agencies.EU Trade Commissioner Catherine Ashton pledged to ‘continue to show leadership on global trade and stand firm against protectionism.’’We need this commitment more than ever to promote trade and overcome the economic downturn,’ she added in a statement in response to the report.-Nampa-AFP