Public discussions on trade issues must take place more actively if Malaysians are to be able to understand and adapt to changes in trading rules that would result from the country's membership of the World Trade Organisation (WTO), a consumer rights activist asserted today.

Consumers International Asia-Pacific Director Dr S Sothi Rachagan said the public must be better informed because of the implications of the country's commitments to the body.

"The United Nations has been displaced by the WTO in terms of its significance. With the UN, you can sign treaties but wait on implementation because there is no enforcement mechanism.

"But with the WTO, if you don't enforce (your commitments), you may face retaliatory actions," he said during an interview at his office in Kuala Lumpur.

Sothi said although Malaysian leaders have been vocal during WTO negotiations and are well informed of the issues, other segments of society need to be constantly updated on the issues.

"Malaysia has a very high profile minister (International Trade and Industry Minister Rafidah Aziz) who is very expressive and is well respected. The question is - how well informed is our media and the public about the implications of the WTO agreements that we are signing on to?"

Today marks the third day of tense negotiations at the fifth WTO Ministerial Conference in Cancun, Mexico.

Minimal subsidies

Often marked by strong protests by anti-globalisation campaigners, the 146 members of the organisation are meeting in an attempt to work out global agreements on trade which would balance the differing needs of rich and poor nations.

On Malaysia's main areas of concern at the Cancun meet, Sothi said the Malaysian delegation led by Rafidah is likely to focus on the criticial issue of agricultural reforms.

Although Malaysia too provides subsidies to local farmers, the extent of the subsidies are minimal in comparison to those of developed countries, particularly the United States and European Union countries.

"We have a very high level (of subsidy) in the area of rice cultivation but not much elsewhere," he said, adding that Malaysia is keen to see fairer competition in other agricultural sectors particularly in cash crops such as rubber and palm oil.

He said the main point of contention is the massive subsidies given to farmers in developed countries for domestic as well as export products.

"The EU, for instance, has said that it wants to protect a way of life and a certain cultural tradition. As a consequence, they put up large amounts of subsidies, including subsidies for export.

"What it amounts to in the end is that the true costs of these products are not reflected. The World Bank estimates that 150 million people can get out of poverty if the EU removes these subsidies," he added.

Sothi said Malaysia's approach in heavily supporting local rice farmers while calling for trade liberalisation in other agricultural sectors need not be contradictory because of exemptions allowed for each country to abide by their respective national policies.

"I don't think that in agriculture, you are ever going to get a situation where (the rules) would be the same for every product. There will always be other considerations such as food security, employment issues and labour costs."

Existing mechanisms

Aside from discussions on farm matters, the WTO delegates are also expected to decide whether they agree to start negotiations on other issues such as competition policy, a concept introduced several years ago by developed countries to call for non-discriminatory trade practices in various sectors.

However, this initiative had been strongly opposed by developing countries who fear that domestic enterprises may face stiff competition by foreign firms and powerful trans-national companies.

Malaysia's position of these issues, said Sothi, would likely be pragmatic because of the country's position as one of the most active trading nations in the world.

"I think we all accept that fair competition rules is good. In law, some things are considered per se unacceptable. For example, if you have a cartel getting together (to fix prices), it is an offence straightaway.

"Other things are considered based on 'rule and reason'. Is (the law) reasonable? Is it likely to have a negative effect? They would allow it only if there is no negative effect.

Still, he said most countries would prefer competitive policies to be introduced through other channels and not via the WTO.

"Another advantage of having a competition law is that countries get to exchange information but these countries may not want to have actual pressure bearing down on them. They do not want to (compromise) their national policies.

"There are many other mechanisms already set up but their resources are untapped, so why don't we strengthen these mechanisms first?"

On the implications of a competition policy on Malaysia's affirmative action policy, Sothi said such national objectives could still fit in with the law.

"One example would be in Africa where South Africa has already passed a competition law with affirmative action policies put in place. The country can also put in small and medium enterprise protection measures or include policies for geographical distribution of industries," he said.

Little progress

However, nations would have to be wary of continuous pressure for them to liberalise further once they agreed to any such moves.

"The WTO is like a moving train. (The demands) are always increasing, ratcheting up," he said.

On the Cancun talks, Sothi said it would be unlikely for talks to break down since all parties have a stake in moving the process forward.

"Even developing countries want some solutions. They have to keep the process going although I don't think they will make substantial progress."

He said explicit agreement on commencing discussions on competition law would also not be forthcoming.

"I suspect that they (would emerge) to say that they will continue with the study process and capacity building process."

"I think this is fair. It would not be an outright rejection," he added.