Breaking the WTO Deadlock

The eighth round of negotiations among the member countries of General Agreement on Tariffs and Trade...

WHO, WHAT

8226; Uruguay Round: The eighth round of negotiations among the member countries of General Agreement on Tariffs and Trade GATT that began in September 1986 at Punta Del Este in Uruguay, came to be known as the Uruguay Round. Concluded in Geneva in December 1993.

8226; WTO: Established in 1994, the World Trade Organisation is the successor to GATT. The WTO has a legal basis and enjoys privileges, immunities.

8226; NAMA: Market access negotiations for non-agricultural products are known as NAMA. Along with industrial products in general, NAMA also includes fish and forestry products.

8226; Doha Round: Began in November 2001. Set up two new working groups on Trade, Debt and Finance and on Trade and Transfer of Technology. Though the Doha Round is the Ninth Round of global trade negotiations, it is the first round of WTO. In December, the 150 WTO member countries met in Hong Kong to try and take the Round forward, but little was achieved.

WHAT8217;S AT STAKE

At Hong Kong, WTO members had decided to arrive at the full modalities for discussing tariff cuts in the Doha Round by April 30, 2006. With little change in stance post-HK across the developing and developed nations, this deadline seems difficult to meet. Failing to arrive at full modalities by April would jeopardise the fate of the Doha Round, that everyone expects to conclude by end-2006 or early 2007. If that isn8217;t met, the Round could be set back by a few years, as a US Fast Track Trade

Authority allowed by the US Congress to take decisions for multilateral trading systems with minimal interference, loses its powers in mid-2007.

WHAT NOW

Story continues below this ad

The April 30, 2006, deadline is therefore being viewed as 8216;drop dead date8217; for WTO, as US Trade Representative Rob Portman puts it. Ministers from the G6 group of nations that control 60 per cent of world trade8212;the United States, European Union, Japan, Australia, Brazil and India8212;began meetings in London on Friday to expedite the modalities.

8226; With the US and EU refusing to budge too much on reducing their domestic agricultural subsidies while seeking greater market access in developing countries for their agricultural and industrial goods, it8217;s unlikely the negotiations will get out of the stalemate unless someone blinks.

8226; The developing world, led by India and Brazil, are a much stronger force than in the past, making an easy compromise a distant reality. The coming months are crucial for the WTO to retain its credibility.