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Time For U.S. To Listen On Trade

Time For U.S. To Listen On TradeWhile the world listened to the U.S. during trade talks in the 1990s, a Tufts expert says it’s time for a role reversal. Medford/Somerville, Mass.

Medford/Somerville, Mass. [10.23.03] In November, dozens of trade ministers from across the Western Hemisphere will arrive in Miami to begin a new round of trade talks. While the U.S. may be the host, it shouldn't be the loudest voice at the table, says a Tufts expert.

"The big question is whether Miami will be a repeat of recent world trade talks in Cancun [which ended abruptly with little progress]," Tufts' Kevin Gallagher wrote in an op-ed for The Miami Herald. "If the U.S. wants to see progress on trade, they will have to listen to the concerns of its southern neighbors."

According to the research associate at Tufts' Global Development and Environmental Institute, the approach would mark a big change from U.S. strategy at previous talks.

"During the 1990s, Latin America and the Caribbean listened to the United States," Gallagher wrote. "In response to major Latin American economic crises in the 1980s, a ‘Washington Consensus' preached trade and investment liberalization, mass privatization of state-owned enterprises, and a general reduction of the role of the state in economic affairs."

But for many countries like Mexico - which followed the U.S. recommendations closely - few gains were made.

"According to official statistics, while exports and investments have soared since 1985, the Mexican economy has grown very slowly - less than one percent annually in per capita terms," Gallagher wrote in the Herald. "Poverty rates are estimated to be as high as 80 percent in Mexico and that inequality has significantly worsened."

The effects have extended beyond just the economy.

"Environmental conditions have also deteriorated," Gallagher wrote. "The Mexican government estimates that the economic costs of environmental degradation have amounted to 10 percent of annual GDP, or $36 billion per year."

When they arrive in Miami next month, trade leaders from South and Central America are expected to have these and other issues on their agenda.

"All of the most contentious issues that plagued the Cancun talks are on the FTAA table - agriculture, investment, government procurement, competition policy and subsidies," the Tufts expert wrote in the Herald. "As in Cancun, our southern neighbors will come with an agenda that includes demands for reduction in agricultural support in the U.S. and an insistence that any new trade rules give nations in the hemisphere the space to install national policies to spur development."

To facilitate progress at the talks, the U.S. may need a new approach.

"The rest of the hemisphere listened to the U.S. during the 1990s," Gallagher wrote. "It is now time for the U.S. to listen to the hemisphere."

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