Progress with trade

There are initial signs of progress at a meeting of trade ministers in Montreal, as the proximity of next month's make-or-break world trade talks in Mexico appears to be focusing ministers' minds.

Trade ministers from 25 countries have gathered in Canada to try to resolve deep differences over agriculture between Europe, the US, Japan and the rest of the world.

If the arguments over farming subsidies are not settled, the chances of the 146-nation meeting in September making progress on medicines and other issues vital for developing countries are close to zero.

Europe is offering some cuts on farm subsidies and bigger import quotas on some products, and says it is "cautiously optimistic" that it and the US can reach some sort of a rapprochement.

The basic positions of the EU and US remain far apart, with Europe looking for across-the-board proportionate tariff cuts and the US showing no signs of backing away from setting a single, low level to which everyone would have to meet.

Source: BBC 30 July 2003 (adapted)

Questions

  1. Outline TWO possible 'differences' countries may have over trade.
  2. Europe is offering cuts on import quotas. Why are quotas imposed in the first place?
  3. Outline FOUR alternatives to quotas as a means of protectionism.
  4. Evaluate the main advantages of 'free trade'.
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