Developing countries like Sri Lanka face a severe dearth in technical expertise and capacity needed to play the world trade game, and until that deficit is bridged these countries will continue to get the sour end of the deal, a top international law professor stated recently.


Prof. Tony Anghie also said that Sri Lanka should be more strategic when using technical assistance provided from abroad. Speaking at the same event, Tourism Minister Milinda Moragoda said that the continued friction in the trade talks arena would lead to the further polarisation of the developed and developing nations, leading to a loss of confidence by the people in the world trade system. However the Minister stressed that this should not be used as an excuse to ‘sit and do nothing’. He stressed that the ultimate beneficiary of increased international trade is and always should be the people of the country, and the ‘human face’ must be of foremost consideration during trade talks. They were speaking at the inauguration of the International Trade Law Conference 2007.


Minister Moragoda, also asserted that reform, in a broad sense, is ‘not a bad word’, and Sri Lanka needs to focus on becoming more competitive while ‘looking for solutions, not making excuses’. The Minister noted that world trade ‘forms an important basis for wealth creation’, and commended the new Doha round for embodying an actual development agenda, unlike the previous Uruguay round. The conference titled “The Doha Development Agenda and the Future of the Multilateral Trading System” plays host to international and local trade law practitioners and academics.


Minister Moragoda further noted that telecommunications and the media play an important role in informing the people as they create and shape perceptions in society. He urged trade law experts to take advantage of this to publicize the technical deliberations upon conclusion of the conference. Quoting from Thomas Freidman’s famous ‘Lexus and the Olive Tree’, he stressed that prosperity and social consciousness need not be mutually exclusive and Sri Lanka can have them both. “We are living in a capitalist system, there is no escaping it; but we need to link traditional cultural aspects into the new system” he said.


Chief Justice Sarath N. Silva who was key in setting up the Advanced Legal Studies Unit at the Sri Lanka Law College, which is the knowledge centre dealing with international trade law education, said that despite some preferential treatment given by the west through schemes like the EU’s GSP+ access, a ‘level playing field’ could never be attained, as developing countries are at a clear disadvantage.


He urged the west to drop political and legal conditions when entering into trade treaties with countries like Sri Lanka. “Please don’t grant trade preferences based on political conditions and performance of governments. Tie them to the needs of the people. Governments will come and go but the suffering people will still be the same”, he told the international community.


He also urged the west to not be so trigger-happy when shooting off travel advisories on Sri Lanka, pointing out that ‘in the past several years no tourist has been hurt in any terrorist attack, only military targets were attacked’.


He said that such statements dent the country’s status unnecessarily and claimed that certain ‘interested parties’ give undue media attention to such matters with the intention of creating a ‘fear psychosis’.
Tony Anghie, Professor of Law at the University of Utah, presented the keynote address highlighting the history behind trade treaties and their evolution over time. Speaking on the current status of international trade, he noted that the WTO dispute resolution mechanism has all the qualities of a good world trade justice system where ‘big powers and small powers can be treated equally’. However he questioned if developing countries have suitable access to this effective dispute settlement device.


He also observed that the WTO has failed in dealing with the ‘human face’ of world trade law, and some of the new trade treaties go against other areas of public international law like environment protection and human rights. He emphasised that despite its current paralysis, the Doha round has the potential to bring about development and bridge the ‘rich-poor divide’. On the importance of governments, he said that the “comparative advantage is a product of history and the endowment of natural resources, but government policy has an important role to play in leveraging that”. He stressed on the need to transform existing comparative advantages to suit the needs of the hour. Prof. Anghie also noted that some developing countries who suffered under trade rules biased against them still managed to succeed owing to clever, far-sighted policies. He added “some developing countries need a degree of protectionism themselves. They need some sort of respite for their infant industries; otherwise they’ll be locked into the same comparative advantage historically granted to them”. The Professor questioned if the Doha round does give developing countries the opportunity to take steps that developed countries took to protect their industries earlier in history. He noted that the reason for much of the discontent is because developing nations saw how much the west gained from the Uruguay round; a round which resulted in agreements on intellectual property rights and services liberalisation, but not agriculture. The US has gained around $8 million dollars on the Trade Related Intellectual Property (TRIPs) agreement alone, which was a product of the Uruguay round. Developing countries felt they made concessions to the developed world, and ‘lost the round’ overall. However he reaffirmed the sentiments of the Deustche Bank Chief Economist made last week, saying that the reverting to bilateral treaties is not a good idea because the power imbalances will only exacerbate the wealth divide, leading to unequal treaties seen in the imperialist era. Anghie cited the “Political Economy of Knowledge” one of the main reasons for the emergence of unequal treaties. He noted that developing countries like Sri Lanka face a severe dearth in technical expertise and capacity needed to play the world trade game, and until that deficit is bridged these countries will continue to get the sour end of the deal. While noting that accepting technical assistance is vitally important, he cautioned Sri Lanka in its use. “We must consider the broader idea of ‘technical assistance’. It should enable countries to consider their own interests and give them the expertise to critically evaluate trade agreements”.


The academic observed that divisions, poor governance, corruption and a hierarchy would only stifle our ability to make maximum use of trade deals. “What is needed is unity and the pooling of our resources’’ he added. “The closed attitude of ‘nationalism’ is not going to work. Closing our eyes and telling the world to go away is not an option. Everything foreign is not bad”. To minimise local opposition to trade deals, he stressed the need to take WTO awareness to the masses, making it understandable to ordinary people. The law professor noted that it is important for lawyers and economists to collaborate more strongly in the context of trade agreements, with lawyers detailing what is permitted under trade law, and economists using that to seek out practical economic development applications.


Senior State Counsel Janak De Silva was instrumental in putting this landmark conference together, along with officials of the Department of Commerce and Sri Lanka Law College. It is being attended by academics, private sector heads, technical experts, senior legal officers, government officials and students of the law college. The event’s principal sponsor is Sri Lanka Telecom. Sri Lanka Insurance and the People’s Bank are other corporate sponsors.