Former EU trade chief Lamy to head WTO

The new WTO head Pascal Lamy is a French socialist who has promised to act as an 'honest broker' between member states. File picture / Fotopress

GENEVA - Former European Union trade chief Pascal Lamy has been named the next head of the World Trade Organisation (WTO) and immediately vowed to steer struggling free trade talks to a successful end.

The 58-year-old Frenchman was approved unopposed by the WTO's executive General Council after three rivals from developing countries were eliminated in earlier rounds of the selection process for the top job in world trade.

"The 148 members of the World Trade Organisation today formally selected Pascal Lamy of France to be the organisation's fifth director-general," said a WTO statement issued after the closed-door council meeting.

Lamy, a French socialist who has promised to act as an "honest broker" between member states, will take over from Thailand's Supachai Panitchpakdi on September 1.

In a statement issued to reporters in Geneva, he declared: "We have a crucial task ahead: to complete the Doha Development Agenda Round of trade talks. This will be my immediate, first, second, and third priority."

He was referring to the official name of the WTO's round of trade liberalisation talks, launched in the Qatari capital in 2001. The World Bank says that success could give a US$500 billion ($709 billion) a year boost to the global economy.

The first task will be to guide the WTO to success at a conference in Hong Kong in December when trade ministers are scheduled to approve a draft deal for the Doha round.

Also looming large is how to handle the growing trade power of China, illustrated by its surging clothes and textile exports which threaten to unleash a wave of protectionist measures in rival countries, rich and poor.

To add to this, tension is growing between the European Union and the United States, the world's two economic superpowers, over subsidies to their main aircraft manufacturers, which could trigger the biggest trade row ever.

Lamy, who was EU trade commissioner from 1999 to 2004, won the job ahead of his three rivals by appealing to the WTO's poorest and richest states. Uruguay's former trade envoy Carlos Perez del Castillo was the last to be eliminated earlier this month.

Declaring his candidacy last December, Lamy proclaimed: "The priority must be to re-balance the international trading system in favour of developing countries."

However, winning an accord in Hong Kong, which would clear the way for the round to be finalised in 2006, is a tall order, particularly if relations deteriorate between the major trade powers, including China.

Developing and developed countries are deeply divided over a host of issues, from cutting rich nations' farm subsidies to opening up markets in services such as telecommunications.

Diplomats said that the smoothness of the election, which contrasted strongly with the bitterness of the last leadership campaign in 1999, augured well for the trade talks.

"This process has proven that WTO members can work together and take difficult decisions by consensus. I believe our reaching agreement in this manner bodes well," said General Council chairman Amina Mohamed, Kenya's ambassador to the WTO.

- REUTERS