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TRADE: Toning Down Frustration Over Latest WTO Failure

Gustavo Capdevila

GENEVA, Jul 28 2005 (IPS) - This week’s failure by the WTO to reach a key agreement to keep trade liberalisation talks on schedule did not have the same impact as the fiascos in Seattle (1999) and Cancún (2003) because the prestige of ministerial conferences is not at stake as it was back then – and because clear efforts have been made to tone down the reactions.

This week’s failure by the WTO to reach a key agreement to keep trade liberalisation talks on schedule did not have the same impact as the fiascos in Seattle (1999) and Cancún (2003) because the prestige of ministerial conferences is not at stake as it was back then, and because clear efforts have been made to tone down the reactions.

The leading players in the multilateral system have been careful to use restrained terms when voicing their frustration with the lack of the hoped-for breakthrough.

History will record that in late July 2005, the WTO (World Trade Organisation) was once again forced to admit that it had failed to take a necessary step forward in the so-called Doha Round of trade liberalisation talks that was launched in the capital of Qatar in November 2001.

WTO Director General Supachai Panitchpakdi described the situation as "disappointing but not disastrous."

"There has been progress, but we are clearly far from the kind of progress we would all have liked to achieve by the end of July," said Supachai, whose term in the WTO ends on Aug. 31. He will become secretary general of the United Nations Conference for Trade and Development (UNCTAD) on Sep. 1.

"The alarm I sounded earlier this month is still ringing and I urge everyone to hear the warning. It must be a real wake-up for all participants," he said.

"The situation we are in makes Hong Kong harder but not impossible," Supachai added, referring to the sixth WTO ministerial conference to be held in December in that special administrative region of China.

The 148 WTO member states had hoped to reach an agreement this month that would serve as a basis for hammering out final Doha Round accords.

But the disagreements between the rich and poor countries that continually mark trade negotiations once again stood in the way of progress and have created a complicated scenario for the talks in the run-up to the Hong Kong meeting.

While U.S. Deputy Trade Representative Peter Allgeier also admitted that "My delegation is disappointed that we have not made more progress in moving the DDA (Doha Development Agenda) forward," he added that "I do not intend to dwell on this point."

In a similar tone, EU Trade Commissioner Peter Mandelson said "we do not want to overdramatise the issue of this uneven speed," referring to the fact that not all of the Doha Round issues are advancing at the same pace.

"We are disappointed with the virtual lack of progress since July 2004 on trade-distorting domestic support," a weak point in the U.S. bargaining position, he said.

Brazil’s top trade negotiator Clodoaldo Hugueney, who coordinates the Group of 20 (G20) coalition of developing countries, also took a conciliatory tone with regard to the renewal of the talks in September, after a month-long WTO recess.

Hugueney underlined the proposals presented by the G20 regarding the three pillars of the talks on agriculture: internal supports to farmers, export competition, and the biggest bone of contention in the Doha Round – market access.

The Brazilian negotiator said the G20 was willing to be flexible and was keen on making the negotiations transparent.

But the attempts to downplay the frustration did not conceal "a poorly disguised bad outcome," said a Latin American negotiator who preferred to go unnamed.

"Only the furniture has been saved," he said with irony. "Now they are trying to leave the house in order for the new pre-Hong Kong phase of negotiations."

India’s Minister of Commerce and Industry Kamal Nath commented to IPS that at least "everybody’s cards are on the table. Now, from September onwards these cards should be played…But the question is to pick and play those cards in a manner which leads to a proper translation of the development agenda."

"A successful development round is not just a question of tariffs and formulas," but must take into account employment opportunities to be generated in developing countries, he said, highlighting the need to pull millions of small farmers out of poverty.

"We cannot measure this process merely in terms of market access, in terms of all these technicalities," said Nath.

Aftab Alam of ActionAid International said "the problem is that millions of poor people depend on the outcome of these negotiations. But their concerns are not on the table."

On the road to Hong Kong "there are two key problems," he said. "One, the package of negotiations is anti-poor and the process of negotiations is unfair" and excludes poor countries.

And two, "All countries should be involved, otherwise the Doha Round would be under jeopardy," Alam added.

But the different approaches to the question of agriculture among developing countries were reflected by comments made by Costa Rican trade negotiator Ronald Saborio in the WTO Trade Negotiations Committee meeting Thursday.

Referring to a document on market access for farm products that Brazil presented in the name of the G20 prior to the meeting of trade ministers held early this month in the northern Chinese city of Dalian, the Costa Rican negotiator described it as "a valuable contribution."

But he clarified that the proposal represents the different viewpoints within the G20 itself, "where there are countries that are ambitious with respect to agriculture and others that are less ambitious."

With regard to agriculture, Costa Rica, which does not form part of the G20, has a more ambitious position than what is reflected in that document, as do delegations like that of Australia, which represents the Cairns Group, an alliance of countries opposed to protectionism in agriculture.

Saborio said any position taken must be in line with the goal that true reforms of trade in agriculture have to be achieved in this round, in order to live up to the high ambitions agreed in Doha and reiterated in July 2004, when a "framework agreement" was reached to keep the Doha Round alive.