Should we believe the optimism of the World Trade Organisation’s (WTO) Direc-tor General Pascal Lamy, when he suggests that global trade talks in the Doha Round are on their last lap and can be completed by the year’s end? Alternatively, is not a more realistic assessment that the possibility of a deal in the near future has begun to evaporate as dramatic shifts occur in prices and global economic and political relationships?
The answer is important for the Caribbean as it struggles to accept the premise on which the Economic Partner-ship Agreement (EPA) with Europe is founded: that tariff liberalisation, open markets, competition and integration will create sustainable economic growth within the time lines proposed.
Speaking last week to the WTO’s Trade Negotiations Committee in Geneva, Mr Lamy suggested that if difficulties on agriculture and industrial goods can be resolved by March, a deal was possible by year’s end.
This is of course a big ‘if’ as the talks have been deadlocked over agriculture since 2006. The issue is fundamental to the negotiations. Oversimplified, emerging nations (Brazil, India, China and others) and less advanced developing nations want to see cuts in the farm subsidies of the kind that the US gives to its farmers and the removal of tariffs on agricultural imports imposed by the EU and others developed nations. If, so the thinking goes, such concessions were to be made in both areas then emerging economies and developing nations would be more willing to grant industrialised nations improved access for manufactured goods and services.
As matters stand revised texts are expected shortly from the chairs of the respective WTO negotiating committees. This means that during February there will be two texts: one on agricultural market access, another on industrial goods, known in the WTO parlance as NAMA (non-agricultural market access) and a third at a slightly later date on services.
Once available these documents will be studied closely in WTO member states with the objective that WTO negotiating groups should then meet to determine whether they can resolve their differences so that a draft text can be put to a WTO ministerial meeting.
Despite this, movement forward is far from certain. The texts that will appear shortly will first have to prove conceptually acceptable if trade-offs are to be made between access on agriculture and goods. Only then might it be possible for there to be discussions at a ministerial level on the percentage reductions in subsidies and tariffs.
What Mr Lamy’s remarks reflect is the outcome of a lunch hosted in the margins of the World Economic Forum in Davos, Switzerland on January 26. There trade ministers from the US, the EU, Brazil, India, and other countries agreed that there should be a ‘mini-ministerial’ meeting in March or April to strike a framework accord paving the way for concluding the struggling talks by the end of the year.
Despite Mr Lamy’s positive outlook, the view of the EC Trade Commissioner Peter Mandelson, was more qualified: “We’ve agreed that if the round is going to be done successfully, it needs to be done this year. It needs to be done on President Bush’s watch
