SINGAPORE, 14 October 2003 — Jordan’s King Abdallah called on the global community yesterday to embrace a “dynamic new partnership for development” at a major economic summit here that was otherwise overshadowed by the Iraq war and terrorism.
In the headline speech on day two of the World Economic Forum’s East Asia Summit, Abdallah hit out at the inequities between the world’s rich and poor that he said were creating security and economic divisions across the globe.
Abdallah described the failure of the World Trade Organization’s (WTO’s) talks in Cancun, Mexico, last month as a reality check that should force greater focus on removing imbalances in the global trade system. “Too few control too much and too many have too little to hope for,” he said.
Abdallah quoted World Bank President James Wolfensohn’s recent comments that the world was “out of balance”. “He is right. In a world of six billion people, one billion own 80 percent of global GDP (gross domestic product). At the other extreme, one billion struggle to survive on less than a dollar a day.”
Abdallah said despite the disparities, international cooperation was the only way to remove the inequities in global trade. “This is why we need a dynamic new partnership for development, one that reflects the integration and participation of all the world’s economies.
“What is needed now is global resolve to heal old divisions and build partnerships for change. Lasting peace and sustainable development will only come when we achieve greater cooperation and a greater balance between rich and poor.”
The WTO’s global trade blueprint was derailed by the Cancun failure when the world’s poor nations united into the Group of 22, or G-22, to address the exploitation they say they suffer through globalization.
One of the biggest sticking points was the devastating impact agricultural subsidies paid by rich countries to their farmers have on poor nations.
The G-22 became locked in a sharp stand-off with the rich nations, primarily the United States, Japan and Western Europe, who refused to make substantive compromises on the agricultural subsidy issue.
Many believe the Cancun failure means the Doha timetable of January 2005 for implementing many of the WTO’s global trade policies cannot be met.
Abdallah also dwelt on the problems facing Iraq and the Middle East during his speech and later in a 45-minute press conference.
One plenary session at the WEF summit yesterday focused on the impact terrorism and other security threats are having on East Asia’s economies.
Singapore’s minister of state for defense, Cedric Foo, told the session that governments and businesses must cooperate more as terrorists increasingly focused on soft targets to disrupt global trade.
While security issues and global division dominated yesterday’s agenda, many delegates gave an upbeat assessment about East Asia’s economic prospects on the first day of the summit on Sunday.
“This idea of a dynamic renewal is very clear after a very difficult year,” WEF Asia Director Frank-Jurgen Richter said as he opened the conference.
A session on Thailand continued the optimistic tone yesterday, with delegates outlining the positive factors that are expected to give that country the highest economic growth in Southeast Asia next year. The WEF’s East Asia summit has attracted more than 800 business and political leaders from around the globe.
Bank of Japan Assistant Governor Eiji Hirano said yesterday that the rising yen could hurt Japan’s economic recovery.
“I share the concern that the rapid appreciation of the yen could harm the recovery story of Japan,” Hirano said on the sidelines of the World Economic Forum.
He added that there was also “no hard evidence” that Japan can get rid of deflation anytime soon, which “implies we should continue with a (monetary) easing framework for the foreseeable future.”
Monetary easing would lead to a weakening of the currency, assuming other things being equal, he said. But he pointed out that “other things are not equal,” implying there was no direct linkage between the foreign exchange rate and the easing policy.