Ethiopia is asking to join the World Trade Organization without meeting WTO standards for liberalizing key sectors of its economy. The move is an attempt to kick-start Ethiopia’s WTO accession process, which has been stalled for seven years.
Senior World Trade Organization officials joined a delegation from Ethiopia’s Trade Ministry this week for a U.S.-government sponsored workshop. The objective was finding a middle ground between Ethiopia’s refusal to open sectors such as banking and telecommunications to foreign competition, and the WTO open trade regime.
Reuters news agency quoted State Minister for Trade Yacob Yalla as saying that surrendering sensitive areas such as banking and telecoms would harm national interests. He expressed confidence Ethiopia’s accession would be finalized, but said "we expect them to respect our sensitivities”"
But the head of the WTO working party on Ethiopia, Steffen Smidt, says the country’s future trading partners would likely insist on an end to restrictive trade practices.
"When you enter into a trading arrangement, you automatically get access to other countries’ trade, based on the principle we called MFN. Most Favored Nation," he said. "Similarly, other countries get access to yours. So in that sense there is automatically in some areas some opening up, or liberalization."
But the WTO representative said Ethiopia’s position as one of Africa’s poorest and Least Developed Countries (LDCs) might warrant consideration from trading partners.
"Those are the future partners in the WTO who would insist on having some sort of access in this area," he said. "So that they will respect that Ethiopia is a Least Developed Country, and Least Developed Countries have special principles people should adhere to, sort of guidelines that speak about restraints from other partners, so yes, there will be a deep negotiation on this."
The two-day workshop featured presentations by representatives of Cambodia and Yemen who led their countries’ WTO accession process. Cambodia’s Sok Siphana said his country has been transformed since emerging from economic isolation on joining the WTO in 2004.
"We knew what isolation means, we knew what poverty is, we went through a very difficult period, so for us, we want to be part of the world trading community, and we felt that the WTO gave us that overarching development objective, and from there on, we never looked back," he said.
Siphana told Ethiopians at the conference that opening Cambodia’s banking sector triggered a surge in rural development.
"Our banking sector is thriving, now they are in position to move to rural areas, to start lending to rice millers, rice exporters, not something you would see from a banking sector that is cash poor," he said. "[They are] cash rich, they see the country developing. "
He says Cambodia has dreams of becoming one of Asia’s information technology centers.
"We even have as recently as two-three months ago formation of all IT companies in Cambodia, and their vision is in five years, they want to position Cambodia as one of the Asian Silicon Valleys," he said. "Now that’s bold."
Ethiopian Prime Minister Meles Zenawi, a former Marxist rebel leader who seized power 20 years ago, said in 2009 he hoped to complete WTO membership within three years. WTO representative Smidt expressed hope the accession could be done promptly, but cautioned that the process is still in a preliminary stage after a seven-year hiatus.