Wednesday, August 29, 2012


There are no expectations here in Geneva – regardless of who wins the Presidential election in the United States – that negotiating activity will be anywhere near as rapid and furious as it was during most of the previous 10 years of the Doha Development Agenda negotiations.

However, when World Trade Organization trade envoys return here next week from their traditional August recess, they will meet up with some unfinished business. For a start, they are expected to intensify ongoing negotiations on trade facilitation – a leftover piece of the moribund Doha round.

Trade facilitation remains an area of importance to industrialized countries, particularly the United States. A number of developing and some least-developed countries also view it as important – but for different reasons. The last round of TF meetings in July saw a huge turnout of officials from least-developed countries thanks to travel funds provided by the European Union and Norway.

So far, progress in the negotiations has been halting due to the continued wrangle over some very big trade-offs. Industrialized countries, for the most part, want binding commitments on a range of very specific disciplines – publication and availability of information, advance rulings, expedited appeal procedures, fees and charges, the release and clearance of goods aand expedited shipments and transit.

But developing countries want to see some promises from industrial countries on things like special and differential treatment – particularly on technical and financial assistence to implement their TF commitments. They also want more commitments on customs cooperation.

The next four months will show whether members are ready to enter into a give-and-take phase to advance the negotiations towards closure next year.

Some countries also might press for an honest discussion on "balance" issues within the TF negotiations and between TF and other areas, such as the "LDC package", "cotton" and agriculture export subsidies. China, India, Brazil and South Africa have already strongly suggested that it would be difficult for them to join the trade facilitation agreement without knowing the fate of the DDA negotiations.

The fact remains at this point that big developing countries still doubt the intentions of some industrialized countries over whether they would continue to embrace the Doha agenda if an agreement on TF is concluded.

Another priority for the United States is a plurilateral agreement on services liberalization. Washington has succeeded in mobilizing support for what it calls an international services agreement.

The United States has some powerful backers – including Mexico, Chile, Colombia, Peru, Costa Rica, Singapore, South Korea, Hong Kong, Pakistan, Taiwan and Israel, among others.

But in spite of several rounds of intensive technical meetings since last March, the plurilateral negotiations remain stillborn. It is without any defined or distinguishable features, particularly about the level of ambition concerning the coverage of sectors and the compatibility with the General Agreement on Trade in Services.

Opposition from some other big developing countries – including China, India, Brazil and South Africa – is more basic. They view the plurilateral effort as an attempt to poison the multilateral framework in general, and Doha negotiations in particular.

Next year will also be at least symbolically important for negotiators as the political process begins toward choosing the next Director General. Pascal Lamy, by the end of next year, would have served two full terms.

A former European Commission official and French technocrat, Mr. Lamy took over the WTO reins long ago in 2005. Unfortunately, Mr. Lamy was not able to bring the Doha negotiations to a close. Its final demise, expected to be pronounced next year at the December Bali ministerial meeting, will have been the first major multilateral trade negotiation to fail.

The Director General, however, is not to blame. He can only try to direct what the majors want – and do his best efforts to get members to go along. Unfortunately, the major players – particularly the United States – never really had their priorities set on a successful conclusion. That especially was the case during the second part of the Bush Administration and the last four years of the Obama Presidency in the United States.

Some here blame Mr. Lamy’s excessive emphasis on selective ministerial involvement which sidelined the majority of members – mostly developing and least-developed countries. In retrospect, some here say a more comprehensive envoy- and official-level involvement would have kept the oxygen flowing to the patient. It would have led to "agreed" compromises at the working level, reserving ministerial involvement to simple "yes’s" or "no’s".

Some also blame the French bureaucrat for remaining indifferent to calls for more democratic and decentralized functioning within the organization. That process inevitably led to low morale among Secretariat staff and member delegations. Institutional memory and plurality of views are two major ingredients of any big multilateral effort, such as Doha. But diplomats here – many playing the role of "Monday-morning quarterbacks" – see Mr. Lamy’s two successive terms as having eroded these "noble" conventions.

Already the political tussle for the top job has commenced. Most suspect the final contest will be one between a South American and African candidate. Neither continent has had a chance to lead the WTO or predecessor General Agreement on Tariffs and Trade.

Expectations remain high for US leadership after the November Presidential elections. With most diplomats here self-described as "die-hard" internationalists, few seem to savor the prospect of a conservative Republican becoming US President. They look forward to a second-term President Obama to shift emphasis away from persistent domestic economic problems – many of which have led to some questionable protectionist practices – to the international arena.

Should current chief White House international economic advisor Michael Froman become US Trade Representative, envoys here suggest movement beyond Trade Facilitation – perhaps leading to reinvigorated discussions on expanding duty-free treatment for much technology goods, like information and communications equipment.

With the recent entry of Russia into the world trade body, the BRICS – Brazil, Russia, India, China and South Africa – also are expected to assume a bigger role in WTO decisionmaking.

The least-common denominator for next year is that by the time of the Bali ministerial, there will be a Trade Facilitation agreement ready for final approval and the formal close to the ill-fated Doha round.

Optimists are suggesting that 2014 might see the launch of a new round of negotiations on sectoral agreements.


Ravi Kanth and Jim Berger

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