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HK calls for free trade in WTO: attacks US policies

HONG KONG: Hong Kong on Friday called for "completely free trade" between World Trade Organisation (WTO) nations and criticised US government procurement policies as an area of special concern.

Director-General of Trade, Tony Miller, told an American Chamber of Commerce lunch that "the time is ripe" to speed up liberalisation.

"You can expect us to push for more and more rapid liberalisation. We want to set targets for completely free trade, rather than only agreeing on the next limited incremental cut," Miller said.

He said multilateral trade negotiations had often been criticised for their glacial speed, saying that one of the reasons they moved so slowly was that they had become highly institutionalised.

"When process begins to block progress, I think the time is ripe for looking at new ways of doing things," Miller said.

"We want to see several tariffs abolished immediately. We also want to see textiles and clothing removed more rapidly from their current quota straight-jacket."

Government procurement offers further potential, he said. While Hong Kong is a signatory to the existing General Agreement on Tariffs and Trade (GATT) code on procurement it wants changes before it agrees to sign up to its WTO successor.

The new code "simply cements into place existing reciprocal restrictions," Miller said, adding that "our own practices are entirely open."

"The US has certain restrictions that require federal or state agencies to buy American when they are procuring goods," a chamber of commerce member told AFP.

Miller said US appeals in this area would continue to ring hollow for as long as the "Buy American" provisions remained in force and sub-federal agencies were excluded.

"By all means, let's put government procurement in the agenda, but let's talk turkey and not trimmings," he told the chamber of commerce.

US Chamber of Commerce Chairman Frank Martin was happy to endorse Miller's views.

"We at the American Chamber of Commerce are strong proponents of free trade and open markets," Martin told AFP.

"We are opposed to any type of managed trade, and while we like to see an increase in exports of US products, at the same time we favour a level playing field where the strongest products succeed."

Miller called for "global rules for a global economy."

"Currently, we have a complete mismatch between the way in which business is operating and the trade instruments, which we have developed and elaborated within GATT, now the WTO. When the rules become part of the problem, it is clearly time to re-examine the rules".

As business operates more multi-nationally, he said, the relationship between trade and investment becomes more complex, as do the linkages between rules governing both, whether they apply to origin, anti-competitive practices, subsidies or incentives, domestic content requirements or preferential rules.

"There may not be a single solution," said Miller, adding that "there is, however, clearly a need for ensuring that the multilateral rules are coherent, mutually consistent and lend themselves to equitable and economically efficient outcomes rather than the reverse."

He said the first annual WTO meeting to be held in Sinapore in December should address these issues.-AFP