Multi-national corporations put the pressure on developing countries at the World Trade Organisation meeting last week, claiming they were losing billions of dollars because of restrictive practices in international trade in IT products.
Although delegates from many developing countries attended a one day seminar on the subject at WTO headquarters, none challenged the idea that a completely free world market in IT products would be beneficial for all.
Patrick Low, the WTO's chief economist, told them world trade in telecommunications and office equipment, a substantial part of which comes under the current Information Technology Agreement of the WTO, reached $670 billion in 1998 and accounts for 13 per cent of world merchandise trade.
The WTO wants to expand these figures but is hamstrung by the fact that developing countries, led by India and Malaysia, want to continue restricting imports of this equipment because they are afraid it will stop development of their own industries.
"IT is rapidly growing in our country and we do not want to see that growth impeded by free flowing imports," Mohammed Salleh Haj Masduki, vice president of Malaysian company Multimedia Development told the meeting.
But that is just the point, William Maxwell, international trade policy manager of Hewlett-Packard, said. Maxwell spoke on behalf of the Information Technology Industry Council, of Washington DC, which has been the leader in industry's fight to liberalise IT trade further.
Non tariff barriers for example should be swept away under WTO rules, together with the certification requirements which many governments ask for on IT imports, he said.
"These (third world) requirements have multiplied seven times in the last decade," Maxwell said.
Other members of the Information Technology Council are Apple Computer, Compaq, Eastman Kodak, Gateway, IBM, Intel, Microsoft, Motorola, Sony and Xerox.
Maxwell declined to put a figure on the amount of business these companies are losing as a result of third world restrictions, although he did not argue with Low's 1998 figure of $670 million as a 1998 world trade number. Other industry participants said that if the restrictions were swept away world trade in IT products would be well over $1,000 billion by 2001.
"An IT product's life cycle is between 12 and 18 months and the people who buy them are having to bear hundreds of millions in additional costs," said Maxwell.
Governments, he said, should adopt one standard and recognition of the supplier's declaration of conformity. This is essentially what the WTO is proposing in its draft text for a second version of its (1998) Information Technology Agreement, stalled in negotiation for the past year.
Michel de Vecchis, director of standardisation at Alcatel, said this was basically a sound proposal, particularly since the problem essentially lies in developing countries - most international standards are mandatory in Europe. But he said the WTO should keep an eye on IT trading to weed out "black sheep".
"There are always going to be companies which don't provide truthful information on their products," he said. "I suspect this is what this is about."
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