Leading trade powers struggled at the weekend to salvage the Doha world trade round in the face of a threatened eleventh-hour rebellion by developing countries this week that could scupper the talks, reports the World Bank press review Monday.
With less than three weeks left to agree on a negotiating framework for the round, ministers from the US, the European Union, Brazil, India and Australia said on Sunday they had narrowed some differences at a weekend meeting in Paris.
The Doha talks face a challenge Monday when ministers from the Group of 90 developing countries meet in Mauritius. Trade diplomats fear that the meeting, which Mr Zoellick and Mr Lamy are to attend, could cause African, Caribbean, Pacific and least-developed countries to harden their position, imperiling the round.
Some officials worry that the meeting could lead to a re-run of Septembers World Trade Organization ministerial talks in Cancun, which collapsed after G90 members walked out. They say many of the G90s demands are politically unrealistic. Several ministers attending this weekends talks in Paris issued veiled warnings that G90 members interests would suffer if the round failed.
Although the Paris talks achieved no breakthroughs, some participants said they were more hopeful of reaching a deal by the end of this month, after which the US presidential elections and appointment of a new European Commission in November are expected to rule out further negotiations until next year.
The ministers instructed Tim Groser, New Zealands WTO ambassador and chairman of the agriculture negotiations, to draw up a draft text by the end of this week.
Meanwhile, poor countries demanding a greater share in world trade must be prepared to compromise to clinch an accord to invigorate the world economy, Mauritius, a prominent voice in African commerce, said on Sunday.
The so-called Doha round of trade talks broke down last September in Cancun over developing countries unhappiness with farm subsidies in the U.S. and European Union. Since then, World Trade Organisation members have been struggling to get the talks back on track by an end-July deadline.
– It is important that we understand that a negotiation is a dynamic process, and, in a multilateral setting, it will demand constant adjustment and trade-offs, Mauritius international trade minister Jaya Krishna Cuttaree told trade ministers from African, Caribbean and Pacific countries (ACP).
– It is important that we transcend our declaratory postures to move into a negotiating mode and that we learn from the lessons of Cancun so as not to be pinned down in the blame game once again, added he.
Ministers from the 79-nation ACP hope to reach a consensus on how to break the deadlock on liberalising global trade, which will feed into a key G90 meeting of developing countries on July 12-13.
G90 countries are expected to meet senior officials from rich nations, including U.S. trade representative Robert Zoellick, EU trade commissioner Pascal Lamy and WTO chief Supachai Panitchpakdi at the Mauritius gathering in an attempt to reach a framework for the deal by July 30.
The WTOs 147 members broadly agree that the global economy needs a new trade treaty to cut tariffs and subsidies, opening up markets to more international commerce.
The hard part is agreeing who should cut what by how much, especially in the politically charged area of agriculture – which remains the toughest sticking point since it derailed last Septembers WTO meeting in Cancun, Mexico.
Negotiators are struggling to find a compromise between rich agricultural protectionists like Japan, who maintain high import tariffs to protect their own farmers, and exporters from Australia to Brazil who want tariffs slashed.
Japan, Switzerland and the eight other members of the so-called Group of 10 heavy farm importers warned last Monday that they would not sign on to a deal that imposed strict caps on their highest tariffs.
Now, agricultural exporters – many of them developing countries – are being asked to soften their demands for the sake of a deal.
Proposals introduced by Washington last month would allow the protectionists to keep high tariffs on some of the most “sensitive” farm goods provided they increase quotas, the limited quantities allowed onto their markets duty free or at reduced tariffs. Officials meeting in Paris know they will have a tough time getting such concessions past some 60 poorer WTO members.
The International Herald Tribune (07/10) explains that developing countries are grabbing for a bigger piece of the global-trade pie by fighting for freer agricultural markets. At the same time they are increasing trade and investment ties among themselves.
The economic and political clout of the group, sometimes called the “Group of 21” a collection of countries from the developing world led by Brazil that includes South Africa, India and China has grown. Since it flexed its muscles at the WTO talks in Cancun last year, the bloc has become even more sophisticated at negotiating and winning advantageous trade terms. And its members are increasingly bypassing the developed world.
This axis of economies, which were once considered the economic underdogs, now have burning ambitions, fueled by explosive growth in China and India both of which expanded by around 10 percent in the first quarter of this year. That expansion is in turn fueling the other members growth through their strengthened trade ties.
– These countries can leverage their bargaining power as they become more important as both suppliers and markets, said Dominic Wilson, an economist at Goldman, Sachs. – It will be harder to ignore their demands, added he.
Kilde: www.worldbank.org
