International

U.S. trade policies unhelpful: Canada

HALIFAX, NOVA SCOTIA (CANADA), JUNE 15. G-7 Finance Ministers met on Saturday to talk about the global economic condition — and to weigh strategies for preventing international financial crises like the one in Argentina.

The two-day meeting that opened with a Friday night working dinner is a prelude to a Group of Eight summit in Alberta later this month. Finance Ministers did not discuss their talks, but Canada's John Manley said the main topics were crisis prevention, new ideas on development aid for poor nations, and the overall economic picture around the world.

While the U.S. and other major economies are rebounding after last year's slowdown — exacerbated by the September 11 attacks — the overall climate is not "problem-free," Mr. Manley said on Friday. He also said some U.S. trade policies, such as recently approved agriculture subsidies, hinder the ability of rich nations to convince others to reform their economies. "It's going to be difficult for all of us to advance the cause of liberalisation" in the new round of global trade talks agreed to last November, Mr. Manley said.

In a long-running dispute between the North American neighbours, who share the world's largest trade relationship, the United States has set high duties on Canadian softwood lumber — a move Canada has challenged before the World Trade Organisation.

The Group of Seven comprises the United States, Britain, Canada, France, Germany, Italy and Japan. Russia, a member of the G-8, also was invited to the meeting, along with the World Bank, International Monetary Fund and European Union. Police barricaded streets surrounding the convention centre, and a few dozen policemen armed with pistols and clubs stood at the fence outside as about 100 protesters marched in the streets, some playing bagpipes and banging drums. Activists also held a news conference to call for cancellation of debt owed by poor African nations and more openness in the talks.

Mr. Manley said the Finance Ministers would "set the stage" for the June 26-27 summit, particularly on a new African development plan pushed by the Canadian Prime Minister, Jean Chretien. Called the New Partnership for African Development, it is based on the idea that foreign investment is more effective than direct foreign aid in promoting economic growth needed to combat poverty, AIDS and other ills.

Other issues on the agenda included a compromise in a dispute between the United States and Europe over World Bank support for poor countries. The U.S. says the World Bank, which extends support to poor nations as loans, should shift to grants that don't have to be repaid.

Britain and other European nations say the shift could hurt the World Bank's pocketbook unless rich countries put more money in.

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