Trade & investment
Victor K Fung opening remarks at ICC World Trade Agenda Summit
ICC Honorary Chairman Victor K Fung delivered one of the opening addresses at the ICC World Trade Agenda Summit held on 22 April 2013 in Doha, Qatar. "In my view, there is no better system for stimulating growth and sharing prosperity than a fair, open, inclusive trading system – that which was envisioned at the WTO’s inception," Mr Fung, who is Chair of the ICC Business World Trade Agenda initiative, told delegates. His full speech can be read below:
ICC Honorary Chairman Victor K Fung delivered one of the opening addresses at the ICC World Trade Agenda Summit held on 22 April 2013 in Doha, Qatar. “In my view, there is no better system for stimulating growth and sharing prosperity than a fair, open, inclusive trading system – that which was envisioned at the WTO’s inception,” Mr Fung, who is Chair of the ICC Business World Trade Agenda initiative, told delegates. His full speech can be read below:
Your Excellency Sheikh Ahmad bin Abdullah Al Mahmoud, Deputy Prime Minister
Your Excellency Sheikh Khalifa bin Jassim Al Thani, Chairman of the Qatar Chamber of Commerce
Friends from the International Chamber of Commerce, the Qatar Chamber of Commerce and World Chambers Federation
Distinguished Guests, Ladies and Gentlemen,
Why we are here today?
It gives me great pleasure to open the World Trade Agenda Summit. Today marks the culmination of a year-long effort to canvas the international business community on revitalizing world trade and building support for a multilateral trade framework that is fit for purpose, for the 21st century.
That message is more timely today than ever.
As WTO Deputy Director-General Rugwabiza will confirm, the forecast for global trade growth for 2013 has just been revised downward, from 4.5% to 3.3%. And last week, for the fourth time this year, the IMF revised downwards its forecast for global growth for 2013.
These numbers reflect real changes on-the-ground: less trade, less investment, and fewer jobs. Following the global financial crisis, a return to growth and prosperity seems even further away. And that’s why the World Trade Agenda arrives at just the right moment.
The Importance of Trade and Investment under the Multilateral System
For us at the ICC, there are two engines of the global economy. They are: Trade and Investment. The past quarter century – a great period of economic growth, global integration, and poverty alleviation – offers ample proof. None of these would have been possible without the expansion of trade and foreign direct investment under the multilateral system.
So, the search for solutions to the crisis, and for restarting growth, must begin with trade and investment. To that I would add emphatically “under the multilateral system.”
In my view, there is no better system for stimulating growth and sharing prosperity than a fair, open, inclusive trading system – that which was envisioned at the WTO’s inception.
Today, we are facing two challenges.
First, the project of expanding trade through the Doha Development Agenda has become stalled. This is so, even when over 80% of the terms are ready for signing. We desperately need to harvest the gains and move on.
The second is that the worlds of commerce, technology, science, and society have all changed since the trading system under the WTO was established. Like all institutions, the WTO must evolve with the times. What we need, is a trading system fit for the 21st century.
How do we begin to build this?
What Benefits will the WTA Produce?
The International Chamber of Commerce (ICC) – as the representative of international business — has answered this call with the World Trade Agenda. The WTA is an ambitious yet practical way to harvest the gains from the Doha round, and lay the ground-work for building a 21st century trade agenda.
In the first part of the Agenda, we suggest five simple ways to “seal the Doha victory” before the next WTO Ministerial in Bali in December this year:
- Conclude a trade facilitation agreement
- Implement duty-free and quota-free (DFQF) market access for exports from least-developed countries
- Phase out agricultural export subsidies, and
- Renounce food export restrictions.
- Expand the trade in IT products in order to support e-commerce worldwide
This is an ambitious, but very achievable agenda.
It could also bear great fruits for both developed and developing countries.
The Peterson Institute for International Economics has recently researched the potential benefits of implementing these five items. The team, led by Gary Hufbauer, discovered that these five items could generate a global GDP boost of over $1.1 trillion US dollars. This is based on 1.2 trillion dollars of new exports, and the creation of over 25 million new jobs.
At a time when unemployment is high, growth is stalled, and fiscal coffers are strained, we cannot afford to ignore these potential gains. This is a stimulus-free boost to all our economies.
The Second part of the WTA suggests how to lay the groundwork for a 21st century trade agenda:
Briefly, these five suggestions are:
- To support work towards a multilateral framework on investment – as a way to harmonize and promote global FDI
- To liberalize trade in services, which is a huge source of jobs;
- To support the green economy by freeing up trade in environmental goods and services;
- To reform and advance the WTO dispute settlement system;
- And to pro-actively integrate the many preferential trade agreements into the multilateral system under WTO
In short, these measures would be big steps towards sorely needed new trade initiatives and opportunities.
These items also have the potential to boost the global economy, without additional costs. Liberalizing trade in services, for instance, could potentially provide a boost of over 1 trillion dollars to global GDP, while creating 8.6 million new jobs.
What do we need to make the WTA a reality?
Ladies and gentlemen, all this is within our reach. But we need your help.
It has been said that the greatest obstacle blocking progress on Doha is political will. We must raise our voices and let our leaders know that the time to act is now.
So the ICC—as the voice of international business—will be taking these recommendations to St Petersburg for the 2013 G20 meeting, and we will be lobbying major governments in the run-up to the WTO Ministerial at Bali in December this year.
I would like to ask that each of you do the same within your communities and chambers, and with your governments. We need a resounding call from global business – about the importance of trade and the multilateral system to our economies and societies.
Ladies and gentlemen, friends and fellow travelers:
The ICC was founded over 90 years ago on the premise that the business community could contribute to global peace and prosperity through trade. But there is more work to be done.
I am delighted to see that we have a record turnout and so many distinguished experts for this World Trade Agenda Summit. I am looking forward to benefitting from the rich knowledge that is gathered in this hall today.
Let us draw confidence and new ideas from today’s discussions. Thank you and we look forward to working with you!
Victor K Fung is Chairman, Fung Group; and Honorary Chairman, International Chamber of Commerce.