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On Monday, CGD senior fellow Kim Elliott and I met in Geneva with World Trade Organization (WTO) staff and members of the subcommittee on the least developed countries (known as the LDC group) who are preparing for the once-a-decade United Nations conference focused on least developed countries.
This article also appeared in the Business Standard.
Back in 1971, the then US Treasury Secretary, John Connolly, told his European counterparts that the dollar was “our currency, but your problem”. Today, it seems that China has returned that favour. Its currency has become a problem for the US. Not just the politics but the intellectual climate has become charged with even Nobel laureate Paul Krugman urging strong trade action against China. Treasury Secretary Tim Geithner has a damned-if-I-do-damned-if-I-don’t choice facing him in mid-April, when he is required by law to pronounce on whether China is a currency manipulator.
My colleage Arvind Subramanian published an intriguing Op-Ed in the Financial Times this week. In “The Weak Renminbi is Not Just America’s Problem” Arvind notes that the undervalued Chinese currency is a global problem that requires a multilateral response. He then argues persuasively that neither the United States nor the IMF can be expected to persuade China to revalue its currency. Instead, he says, such action should come from the WTO.
I wrote in a CGD Note last week with Tom Slayton about how the Philippines are engaging in aggressive buying techniques that seem designed to drive up prices, raising the specter of another rice price crisis such as what befell us in early 2008.
I write about trade so I feel that I should say something about the trade ministers’ meeting that concluded yesterday in Geneva. But what is there to say, especially if I want to follow my mother’s advice about not saying anything if I can’t say something nice? There have been almost too many to count of failed meetings trying to bring the ill-fated Doha Round of trade negotiations to a close. This one was supposed to be about institutional issues and how to strengthen the WTO for the future; Doha dominated anyway.
This blog entry also appeared on the Huffington Post.
Leaders of the world’s richest nations have repeatedly pledged to offer the world’s poorest countries duty-free, quota-free (DFQF) access to their markets. Such access is one of the most powerful tools that high-income countries have to help poor countries to help themselves. The upcoming G-20 summit in Pittsburgh is an opportunity for the world’s leaders to finally deliver on this promise.
Last week Secretary of State Clinton, U.S. Trade Representative Kirk, Secretary of Agriculture Vilsack, and other U.S. government officials were in Nairobi at the African Growth and Opportunity Act (AGOA) Forum, making new and improved promises about the commitment of the United States to African development. I was in Nairobi last week too to moderate our fifth consultation meeting for the CGD Global Trade Preference Reform Working Group.
The outcome of today’s G20 summit has become even more critical for developing countries as the World Bank revised the 2009 forecast for GDP growth in the developing world to 2.1 percent down from 5.8 percent in 2008. But a draft copy of the G20 communiqué published by the Financial Times could go farther in its commitment to help the world’s most vulnerable countries.
Would a “Crisis Round” of trade talks launched at the London Summit next week be a useful mechanism for averting a further beggar-thy-neighbor protectionism? My colleague Arvind Subramanian and his frequent co-author, World Bank economist Aaditya Mattoo, think so. They argued for such a move in an interesting piece in the Wall Street Journal Asia earlier this week (A Crisis Calls for a Crisis Round):