MercoPress. South Atlantic News Agency

“Fluctuating G” and Buenos Aires Consensus.

Thirteen countries of the original group of 20 (21 or 22) that was formed in the recent failed World Trade Organization meeting in Cancun, Mexico to fight agriculture protectionism in developed countries, confirmed last Friday in Buenos Aires “the importance of the full standing of the multilateral trade system and the WTO”.

The declaration signed by thirteen representatives of G-17 after the desertion of Guatemala, Costa Rica, Peru and the absence of Peru is geared for the coming WTO meeting to be held next December in Geneva with hopes it will help rekindle free trade negotiations after the Cancun failure.

Insistent rumours in Buenos Aires during the G 17 meeting that includes India, China, South Africa, Brazil and Argentina among others, indicated that both the United States and the European Union were reluctant to retake trade negotiations after the insistence in Cancun for the opening of agriculture markets in developed countries, and the refusal of developing countries to talk about the European initiative (or Singapore issues) that includes global trade, investments and government purchasing.

However US Trade Representative Robert Zoellick denied from Washington such speculations and insisted that "some people have questioned our commitment to WTO, but they shouldn't. After what happened in Cancun we hope every body realizes what is at stake". Mr. Zoellick has been accused of tempting and pushing former G 20 members with bilateral trade agreements and he actually calls the former G 20 the "fluctuating Group", given the number of absences and/or desertions.

Mr. Zoellick also accused Brazil and to certain extent Argentina, of using rhetoric from the seventies during the Cancun WTO meeting.

"It-s hard to fear punishment when you-re right, said Argentine Foreign Affairs Minister Rafael Bielsa who revealed that during the Buenos Aires talks the Singapore issues were effectively addressed".

But in spite of the "fluctuating" situation, this coming week when Brazilian president Luiz Inacio Lula da Silva visits his Argentine counterpart Nestor Kirchner in Buenos Aires, a strong declaration in support of the G 20 position and a "progressive" Mercosur stance is expected.

The declaration apparently will be called the "Buenos Aires Consensus" in contrast to the United States blessed "Washington Consensus" of the early nineties that sponsored globalization, economic liberalism and the opening of Latinamerican markets to foreign investment and trade. This consensus according to leading Latinamerican observers and analysts had much responsibility in the current ruinous situation of the region.

The Buenos Aires Consensus will emphasize fighting poverty and unemployment, plus a Keynesian approach to stimulate local economies.

However it will not deny basic ideas of the original Washington consensus, combating inflation, fiscal discipline, tax reform, deregulation of the economy, improving money value of government spending and strengthening private property rights and ensuring legal support for private contracts.