Resurrection?

Did you think that the Doha Round had died and was gone for good?  Not so: the Trade Ministers in December “deeply regretted that … negotiations are at an impasse”;  but they “remain committed to work actively …. towards a successful multilateral conclusion of the DDA”, and they  “recognize that Members need to more fully explore different negotiating approaches while respecting the principles of transparency and inclusiveness”. [1]

This has led commentators to say that “MC8 shelved the Round for an indefinite period” or that “the Doha Round was closing its doors provisionally” [2]– phrases that convey accurately enough the doubts that exist whether, after a pause for the US elections in 2012, it can be revived, with or without new approaches.  In current circumstances this is not a foregone conclusion.

So, where do matters stand three months on?  Here is a progress report, based on discussion at the EUI in Florence between Ambassadors[3]and trade policy experts and academics.  In summary, from the point of view of moving forward and exploring new approaches, it was somewhat disappointing.

Starting with a range of comments about the current situation, what we heard on the one hand was that no intermediary or facilitator (such as the WTO secretariat) could help when the sides “do not agree on what has to be done” and the gap was unbridgeable;  while on the other hand there were too many areas under discussion where developing countries saw benefits to others and no clear advantages for them.  Surprisingly, this was said about trade facilitation, where the ‘costs’ of changes to their systems for customs clearance were seen as outweighing any benefits to their trade; and about market access where benefits would be largely to ‘western’ exporters despite the record growth in south-south trade in recent years.

This all seemed to show that in three months not much has yet moved.  In peripheral comments [the Americans said] it was said that they had rejected the adoption of a duty-free, quota-free regime for LDCs largely because of …. opposition from other African countries who would face preference erosion (losing benefits they have under the AGOA scheme). The phantom of increased competition from Bangladesh was audible in the room.  There was also a reference to China being the principal subsidiser of cotton (based apparently on calculations by ICAC) – mentioned as a reason why the Americans could not reduce their own subsidy regime – which provoked a strong reaction from the other side. ‘You cannot shelter behind us’.

After all this navel gazing and facing backwards it would have been a relief to look ahead and see what new ideas might be under discussion.  One Geneva representative maintained that new approaches would have to be within the Doha mandate.  Almost the only truly ‘new’ candidate was the proposed plurilateral agreement on trade in services being elaborated by a group of 16 countries in Geneva;  but this did not take us very far. [4]Questions about whether new access would be applied MFN (and indeed could be applied in discriminatory fashion in a field of domestic regulation) or whether it would be an Art. V GATS agreement, or drafted as a ‘WTO agreement’ along the lines of the GPA, were largely left open.

In other areas, less new, there was further support for trade facilitation (where there would be major infrastructure benefits as well as lower transactional costs), especially from the World Bank; but against the view that this was not a win-win sector, this made little impression.  There was also some exchange of view about regulatory divergence in the context of TBTs with the concept of mutual recognition and of negative listing being mentioned.

It was hard to see where this could lead in Geneva.  The current EU enthusiasm for all things bilateral, regional and plurilateral (agreements with Korea and in Central/South America, others under negot-iation with India and Malaysia, also Canada and Japan, the TPP, ACTA and the ISA on Services) is clearly gaining speed.  How such initiatives will be fitted into the multilateral system in due course remains unclear. I asked whether Geneva still considered that a bilateral US-EU initiative for closer trade relations “in a barrier free market” were still thought to be the death of the WTO.  No one wanted to address the issue.

[1]   The Ministers also said that it was unlikely that the Single Undertaking concept (that “all elements should be concluded simultaneously”) could be realised in the near term (para 2), and for good measure they encouraged Members to work towards ‘early harvest’ agreements and ‘low hanging fruit’ (para 5).

[2]   Prof. Vital Moreira, MEP and Prof. Petros Mavroidis

[3]   From the US and EU, and also India and China, as well as the WTO secretariat.

[4]   This was the subject of an ECIPE/ESF conference on March 6^th.  Main protagonists are the US, Australia, Canada, with other OECD countries and a few others such as Chile, Mexico, Hong Kong, Singapore and Pakistan. The EU is participating in the work but more circumspect.