IMF Head Urges US Congress to Save Global Trade Talks

International Monetary Fund Managing Director Rodrigo Rato recently called for the US Congress to do something in order to save the Doha Development Round. Particularly, the IMF chief urged the US Congress to extend the trade promotion authority of the Bush administration. The trade negotiating authority allows Washington to negotiate free trade agreements that must be approved or rejected by the Congress without making any change. The trade authority has been considered as crucial to the global trade talks. Without the TPA, it would be harder to encourage the members of the World Trade Organization to reach a compromise in the negotiations. The extension of the trade authority would also give the WTO members more time to settle their differences and reach a global trade agreement.

In a speech delivered at the US State Department, Mr. Rato said that trade negotiators have the chance to reach a "once-in-a-generation agreement." But he also said that the global trade talks could still fail if the US Congress does not act immediately. According to him, the renewal of the trade promotion authority was important to the Doha Development Round.

It must be noted that the trade negotiating authority, otherwise called as "fast-track authority," enables the Bush administration to negotiate trade pacts that must be approved or opposed by the Congress without making changes. Analysts said that the members of the WTO might lose their interest in the global trade talks if the US Congress refuses to extend the trade authority.

Meanwhile, Washington is doing its best in order to convince the Congress to renew the fast-track authority. Needless to say, there are doubts whether the Democrat-controlled Congress would renew the TPA. So far, the Congress has conducted a step-by-step approach in reviewing the existing US policies on global trade. But the Congress has not yet introduced any legislation concerning the renewal of the trade authority.

The World Trade Organization is pushing hard to complete the global trade talks before the end of this year. Recently, WTO Chief Pascal Lamy visited the US in an effort to promote the Doha Round and seek the support of the US Congress. The global trade talks were launched in Doha, Qatar in November 2001. The Doha Round has been aimed at liberalizing commerce and boosting the world economy. Key issues blocking the progress of the negotiations include the reduction of agricultural subsidies and tariffs on manufacturing products.