News & Commentary:

July 2002 Archives


An Open Letter Recommended!
Kenneth Rogoff (IMF) Jul 2, 2002
By the Economic Counsellor and Director of Research, International Monetary Fund to Joseph Stiglitz, author of Globalization and Its Discontents.

TRIPs Council Agrees On Extensions For LDCs On Pharmaceutical Patents
BRIDGES Weekly Trade News Digest - Vol. 6, Number 25 Jul 3, 2002
WTO Members at the 25-27 June meeting of the Council for Trade-related Aspects of Intellectual Property Rights (TRIPs) adopted a decision to extend the period until 2016 during which least-developed countries (LDCs) do not have to provide patent protection for pharmaceutical products. They furthermore agreed on a waiver for LDCs that would exempt them from having to give exclusive marketing rights for any new drugs in the period when they do not provide patent protection. Animated discussions also continued on paragraph 6 of the Doha Declaration on TRIPs and public health.

US Submits GATS Requests To WTO Trading Partners
BRIDGES Weekly Trade News Digest - Vol. 6, Number 25 Jul 3, 2002
The US on 1 July formally submitted to the WTO its requests for further services trade liberalisation under the General Agreement on Trade in Services (GATS), setting out its positions tailored for each of its 142 fellow WTO Members states on how to bring down barriers in international services trade sectors such as telecoms, banking, energy, environment, education, professional and audiovisual services. Despite this "full range" of covered issues, Deputy US Trade Representative (USTR) Peter Allgeier declared that the US was not making any requests in areas such as water supply, public health, and primary and secondary education, as it was "up to governments to decide what they want to do" in those sectors. He further added that while rich countries and advanced developing countries such as Brazil, the Philippines and India would be asked to make most concessions, the poorest nations would only be asked to "start a dialogue on the role of services" and the "value of openness".

Busy Days For Development Committee At WTO
BRIDGES Weekly Trade News Digest - Vol. 6, Number 25 Jul 3, 2002
On 2 July, WTO delegates concluded the last of three meetings in two days for various sessions of the Committee on Trade and Development (CTD) that addressed a wide range of issues of importance to developing countries. The 2 July formal special session of the CTD was preceded by a regular session on the morning of 1 July, followed by a dedicated session on small economies. The regular session looked at, inter alia, the technical assistance plan for 2002 and 2003, a paper on the participation of developing countries in world trade, an EC paper on sustainability assessments, and a review of government assistance to economic development (Article XVIII of GATT 1994). The small economies session discussed a proposal from Macao, China and another from a group of small countries (including Barbados, Belize, Bolivia, Dominican Republic, Guatemala, Honduras, Mauritius and Sri Lanka). The 2 July special session on special and differential treatment was to consider an addendum to the LDC proposal as well as further talks on other proposals made so far. This special session was also scheduled to look at the elements for a report to the General Council, which is due by 31 July 2002.

WTO Committees Scrutinise GMO Regulations And EU Wine Labelling
BRIDGES Weekly Trade News Digest - Vol. 6, Number 25 Jul 3, 2002
Much attention at the formal meeting of the WTO Committee on Technical Barriers to Trade (TBT) on 20-21 June focused on various forthcoming labelling schemes of the EC, including for genetically modified organisms (GMOs) and wines. Labelling furthermore featured on the agenda of the 20 June informal meeting of the TBT Committee, where the EC and Japan submitted papers on this issue. Discussion on the European and Chinese GMO regulations also continued at the WTO Committee on Sanitary and Phytosanitary Measures (SPS) on 25-26 June.

Why do the Arabs lag behind? Recommended!
Economist Jul 4, 2002
An unsparing new report by Arab scholars explains why their region lags behind so much of the world.

Top economists engage in war of words Financial Times Subscription Required
FT Jul 4, 2002
Kenneth Rogoff, the head of research at the International Monetary Fund, has launched an outspoken attack on Joseph Stiglitz, the former chief economist of the World Bank.

Free Trade Over a Barrel Wall Street Journal Subscription Required
WSJ Jul 9, 2002
How steel tariffs are hurting the real economy.

Spain reaps the euro's benefits
IHT Jul 10, 2002
While Germany, Europe's economic powerhouse, has stumbled since the introduction of the euro, Spain makes the case for euro bulls. After several years of watching their economy grow at a frenetic pace - at least by European standards - Spaniards exude an economic enthusiasm rarely seen in other Continental capitals.

Rules Negotiations: Japan Questions Uniqueness Of Fisheries Subsidies
BRIDGES Weekly Trade News Digest - Vol. 6, Number 26 Jul 10, 2002
At an 8 July meeting of the WTO Negotiating Group on Rules, Members continued discussions on the clarification and improvement of WTO disciplines on fisheries subsidies, with three new papers submitted by China, Japan and New Zealand. The debate largely focused on Japan's communication, in which the country rejected the reasoning of the so-called 'Friends of Fish' group that had previously called for special disciplines on fisheries subsidies. "Those who insist on special and separate treatment of fisheries subsidies have a burden of proof to fulfil," Japan stated in its position paper. Members further discussed antidumping issues and will resume on 9-10 July to continue negotiations on regional trade agreements.

CTD Special Session -- Finding Deliverables For 31 July
BRIDGES Weekly Trade News Digest - Vol. 6, Number 26 Jul 10, 2002
The special session of the Committee on Trade and Development met on numerous occasions over the last week and a half as it headed into the final stretch leading up to its 31 July deadline of reporting to the General Council -- "with clear recommendations for action" -- on the review of special and differential treatment (S&D). Informal and formal sessions were held on 27 June and 2-5 July. Discussions distilled down to four main focus areas: agreement-specific proposals and issues; institutional issues; cross-cutting issues; and the way forward. Another informal for the latter item was scheduled for 10 July. While many delegates have noted minimal expectations for the 31 July report, a few elements have emerged as potential deliverables.

European Union to Tackle Overhaul of Farm Subsidies
NYT Jul 11, 2002
The European Commission on Wednesday approved proposals to overhaul a 40-year-old system of farm subsidies.

Turkey in crisis
Economist Jul 12, 2002
Turkey is the International Monetary Fund's biggest borrower, an applicant to join the European Union, the only Muslim country in the NATO defence pact and a key strategic partner of the United States. Now its government is collapsing.

International financial crises
Economist Jul 12, 2002
The continuing crisis in Argentina has brought the work of the International Monetary Fund under close scrutiny. Critics of the Fund argue that its prescriptions are often wrong, exacerbating rather than alleviating economic problems in emerging market economies.

IMF Advocates Trade and Aid as Solutions to Poverty
Graham Hacche (IMF) Jul 12, 2002
Linda McQuaig writes that "a lot of commentators" are pointing to the ineffectiveness of aid in Africa, which she views as a convenient excuse for the slogan "trade, not aid" (June 30). It is unclear exactly to whom she is referring, but she cannot tar the IMF with this brush. She and Professor Stiglitz do not have a monopoly on compassion, as she seems to suggest, and it is becoming increasingly well understood that Stiglitz is an unreliable source of information on the IMF. In fact, the IMF has always been clear that both trade and aid are needed.

Eye on America, global stocks skid
IHT Jul 12, 2002
Global stock prices swooned Thursday as confidence among investors continued to evaporate, with prices falling most heavily in Europe. The declines Thursday were prompted by the whiff of further financial irregularities in Corporate America, where seemingly daily revelations of financial misdeeds have undermined confidence in stock markets despite indications of a solid economic recovery.

Who's Afraid of 1984? Recommended!
Richard A. Muller (MIT Tech Review) Jul 12, 2002
But in a time when technology is frequently under attack, it is worthwhile to notice its role in spreading truth. It was not Stalinism, but the flow of information that proved to be unstoppable.

Berlin disputes new proposals for farms
FT Jul 15, 2002
Proposals to revamp the European Union's Common Agricultural Policy must do more to cut costs and cannot be allowed to harm farmers in eastern Germany, according to the German government's initial response to the plans, which will today be debated by farm ministers for the first time. Germany, by far the biggest contributor to the EU budget, is calling for the gradual reduction in direct support payments to farmers so as to free up money for the enlargement of the EU.

The dollar Recommended!
Economist Jul 15, 2002
After sliding for months, on July 15th, the dollar finally fell to parity with the euro, and then slid further. Now that it has broken this psychologically important barrier, is the American currency heading for freefall?

Euro shoots above $1; panicky day on Wall St.
IHT Jul 16, 2002
Crumbling confidence in U.S. financial markets Monday sent the dollar tumbling below parity with the euro for the first time in two and a half years.

Economist Jul 17, 2002
World stockmarkets remain volatile in spite of attempts by the Federal Reserve chairman, Alan Greenspan, to restore calm by sounding an optimistic note about America's economic prospects. Even Mr Greenspan has had to acknowledge that risks to recovery remain.

The dollar
Economist Jul 17, 2002
After sliding for months, on July 15th, the dollar finally fell to parity with the euro, and then slid further. Now that it has broken this psychologically important barrier, is the American currency heading for freefall?

CTD Special Session Suspended Over Inability To Agree On Report
BRIDGES Weekly Trade News Digest - Vol. 6, Number 27 Jul 17, 2002
With time winding down on the initial phase of the Committee on Trade and Development's review of special and differential treatment (S&D), Member delegates met informally on 10 and 16 July with the hope of bridging some of the gaps that still remained prior to the 17 July formal session. With a large amount of ground not covered by the end of the 16 July meeting, Members decided to resume on the morning of 17 July and then continue with the regularly scheduled meeting, where they hoped to secure consensus on the report that Ambassador Ransford Smith (Jamaica) is required to present to the General Council on 31 July. Divisions on the report however, proved so wide -- particularly on the section 'The Way Forward -- that the formal session was suspended, pending further revisions to the draft.

Trade, Debt, & Finance Working Group Hears Calls For Financial Reform
BRIDGES Weekly Trade News Digest - Vol. 6, Number 27 Jul 17, 2002
The second meeting of the WTO's Working Group on Trade, Debt and Finance convened on 11 and 12 July, spending the majority of its time hearing reports from a number of regional and international agencies on the linkages between trade and finance. In addition to hearing these reports, the body adopted its work programme for 2002, after being unable to do so at its first meeting last April due to disagreements over the focus of the debt section of the plan.

Cycles of scandal and cleanup
Kevin Phillips (IHT) Jul 18, 2002
America is at a turning point. Corporate scandals, the fall of the stock markets, the sudden mobilizations in Washington to legislate against some of the more egregious corporate abuses - all this indicates that the nation's attitude toward business is changing. It is potentially a bigger change than many politicians realize.

InReview: Books - Defying The Fundamentalists Recommended!
FEER Jul 18, 2002
In "Globalization and Its Discontents," Nobel laureate Joseph Stiglitz argues that proponents of globalization can be as blind to its failings as opponents are to its merits.

The financial system doesn't work
Rubens Ricupero (IHT) Jul 19, 2002
Pictures of people demolishing the Berlin Wall with makeshift tools in November 1989 were among the most cheering images of the time. They promised an era of tumbling barriers everywhere - those dividing people, which could be brought down with the end of apartheid and the Cold War, and those dividing economies, which could be reduced through globalization and liberalization.

A shameful world scandal named Argentina
Hélie de Pourtalès (IHT) Jul 19, 2002
Remember the financial crisis of 1997? It started in Thailand and spread like fire to Malaysia. We thought that Indonesia would be spared, being "too big to fail" - until creditors decided not to renew short-term credit lines. Soon after, all of Southeast Asia found itself in the eye of the storm.

Better Development Through Democracy
Jennifer L. Windsor (NYT) Jul 19, 2002
The United States should use foreign aid to encourage democracy as well as development in Africa.

Commission considers US exclusions from protectionist steel measures "manifestly insufficient"
EU DGT Jul 19, 2002
On 17 July, the European Commission presented a report to the Council on the impact of the US steel safeguard measures taken in March and on the current state of negotiations over product exclusions and compensation for the resulting loss of EU exports. The report considers the exclusions granted so far by the US to be "manifestly insufficient". This report provided the basis for recommendations the Commission made to the Council on 19 July on recourse to short-term countermeasures against the US. This issue will be addressed by Ministers at the General Affairs Council on 22 July.

Stocks Are Only Part of the Story
Alan S. Blinder (NYT) Jul 21, 2002
Those who get their economic news from television may think that if the market is heading south, then the economy must be, too. But it's not true.

A Free-Trade Milestone Wall Street Journal Subscription Required
WSJE Jul 23, 2002
CAP, unfortunately, has no expiration date.

A Bogus Pact Wall Street Journal Subscription Required
Johan Van Overtveldt (WSJE) Jul 23, 2002
Why does the euro keep rising?

Dollar reclaims lost ground despite sell-off in stocks
IHT Jul 24, 2002
The beaten-down dollar, reeling from a parallel loss of confidence in U.S. stock markets, bounced back sharply Tuesday against the yen and the euro, but analysts cautioned against concluding that the currency was back on its feet.

Who Really Cooks the Books? Recommended!
Warren E. Buffett (NYT) Jul 24, 2002
C.E.O's need to step forward and adopt honest accounting practices.

World poverty
Economist Jul 24, 2002
More effort is needed to strengthen democracy as well as economic development in many countries, according to the latest Human Development Report from the United Nations Development Programme. The war on terrorism and the persistence of closed markets are both potential obstacles to progress.

Mixed Outcome For WTO Negotiations Stocktaking
BRIDGES Weekly Trade News Digest Vol. 6, Number 28 Jul 24, 2002
Geneva-based ambassadors and senior officials from capitals met at the WTO's Trade Negotiations Committee (TNC) on 18-19 July to take stock of ongoing negotiations being conducted as part of the mandate agreed to in Doha, Qatar last November. While a much-awaited agreement was reached on the sidelines of the meeting around a deadline for modalities on non-agricultural market access talks, developing countries repeatedly cautioned that little would move forward unless their concerns on implementation issues (such as textiles) and special and differential treatment were adequately addressed.

Arduous Process Yields Agreement On S&D Report
BRIDGES Weekly Trade News Digest Vol. 6, Number 28 Jul 24, 2002
On 24 July, WTO Members reached agreement on a report on special and differential treatment (S&D) to be presented at a 31 July General Council meeting. The decision, reached after many months of wrangling, comes close to the 31 July deadline for the special session of the Committee on Trade and Development (CTD) to report on its S&D review. The report (TN/CTD/3), which will be available shortly via, is said to have settled on 31 December 2002 as the postponed timeline for the Committee to report back to the General Council with "clear recommendations for a decision" on the S&D review; other details were unavailable at time of press.

World markets gyrate in volatile trading
IHT Jul 25, 2002
An electrifying rally Wednesday on Wall Street lifted the Dow Jones industrial average from an early deficit to close 489 points higher as financial markets worldwide were engulfed in a frenzy of volatility.

Stock rout is trickling to broader economy
IHT Jul 26, 2002
As international markets continued to careen, key gauges of business conditions on both sides of the Atlantic on Thursday showed sharp declines that economists described as the first signs that the recent global plunge in stock prices was trickling down to the "real" economy.

EU DGT Jul 26, 2002
On July 24, EU Trade Commissioner Pascal Lamy, External Relations Commissioner Chris Patten and their Mercosur counterparts worked together to inject renewed impetus to the EU-Mercosur relations, by agreeing on an ambitious programme for the trade negotiations. Both parties have agreed on a work-programme, phasing in the negotiations on all issues under the comprehensive agenda, over a calendar of negotiating rounds to take place in 2002 and 2003.

Remembering Rudi Dornbusch Recommended!
Paul Krugman Jul 28, 2002
I should write a proper essay about Rudi Dornbusch, about who he was and what he meant to me. I'm not ready to do that yet. What I can do is put down a few random memories of things, more or less in chronological order, that may help others have a sense of who he was. See also this other essay.

Editorial comment: A good deal on trade Financial Times Subscription Required
FT Jul 29, 2002
The deal reached in the US Congress late on Friday to give George W. Bush the "fast track" authority needed to negotiate international trade agreements is an important victory for the president and his administration. It is also excellent news for the US, its trade partners and the global economy.

A Failure of Democracy, Not Capitalism
Benjamin R. Barber (NYT) Jul 29, 2002
The real cause of spreading corporate malfeasance in America is a lack of faith in democratic institutions.

Free Trade Comeback Wall Street Journal Subscription Required
WSJ Jul 29, 2002
The Democrats are more worried about labor money than Third World poverty.

The Muslim world is hopelessly weak
Mahathir bin Mohamad (IHT) Jul 30, 2002
What is the state of the Muslim world today? I don't think it would be wrong to say that the Muslim world is at its lowest ebb, and is probably continuing to decline.

Free Trade Comeback
WSJE Jul 30, 2002
Now, will the EU slash farm subsidies?

Home | Economics | Business & Finance | Politics | Law | ICT | Development | News | Research