TRADING NATURAL RESCOURCES

The World Trade Organisation wants countries to work together more closely in trade in natural resources.

Natural resources is often seen as exempt from many international commerce rules.

Governments must cooperate more intensively to deal with the challenges for both importing and exporting countries in trade in natural resources, such as export restrictions and import tariffs, according to the annual World Trade Report.

"In a world where scarce natural resource endowments must be nurtured and managed with care, uncooperative trade policies could have a particularly damaging effect on global welfare," the report said.

The report defines natural resources as fuels, forestry, mining and fisheries -- goods that are found naturally and can be used with minimal processing. It excludes agriculture, where products are cultivated not extracted, and industrial goods employing minerals that require a high level of processing.

Trade in such goods in 2008 was $3.7 trillion in 2008, or nearly 24 per cent of total world trade in merchandise goods, a share that has been rising by 20 per cent a year for the last decade, reflecting rising commodity prices.

"I believe not only that there is room for mutually beneficial negotiating trade-offs that encompass natural resources trade, but also that a failure to address these issues could be a recipe for a growing tension in international trade relations," WTO Director-General Pascal Lamy said in a foreword to the report.

WTO rules allow countries to restrict exports of natural resources to preserve an exhaustible resource.