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    Trade Talks in the News

     

     
     
    © International Trade Centre, International Trade Forum - Issue 3/2006

    WTO members suspended the Doha round of trade talks in July 2006. Trade Forum reviewed 50 media sources for their reactions.

    Most opinion-makers were seriously concerned about the future of world trade. There were also those who welcomed the breakdown in negotiations. Many voices called for restarting the talks, but few provided concrete solutions on how to do so.

    Alternatives to a Doha deal point to bilateral and regional agreements. The widespread opinion is that this solution is far less effective than multilateral agreements.

    Commentators also debate the future of the WTO. Should it help manage and monitor bilateral trade deals or only enforce existing WTO rules? Can it assume more flexibility, so that countries that do not wish to participate in specific negotiations and sign related agreements would not be obliged to do so?

    ITC is listening to many voices as it helps developing countries identify their interests and position them appropriately in the trade debate.

    A sample of recent commentary:

    All Fall Down

    "Doha agreement or not, trade among the big countries is booming, their growth rates rising, with unemployment lines shortened. The wealthy nations can live with a stalemate.

    "The real losers are cotton farmers in West Africa, textile workers in low-income Asian and Muslim states, and low-income shoppers in the poorest quarters of America and Europe. The Doha Round was supposed to help the world's poor, by lowering subsidies that keep Mali's cotton out of textile mills, tariffs that limit the flow of Cambodian T-shirts and other clothes to shelves."

    Edward Gresser, Yale Global, 27 July 2006

     

    Plan B for world trade

    "The indefinite suspension of the Doha round […] creates big risks for the world economy. A new explosion of discriminatory bilateral and regional agreements is likely to substitute for global liberalization. This will inevitably erode the multilateral rules-based system of the WTO. The backlash against globalization will generate more protectionism in the vacuum left as momentum toward wide-ranging reduction of barriers ceases, especially as the world economy slows and global trade imbalances continue to rise. Financial markets will become more unstable as international economic cooperation breaks down further."

    C. Fred Bergsten, Institute for International Economics, Financial Times, 15 August 2006

     

    The wrecking of the world trade talks was senseless and short-sighted

    "This disaster, born of complacency and neglect, signals a defeat of the common good by special-interest politics. If the wreck is terminal - and after a five-year stalemate, that seems likely - everyone will be poorer, perhaps gravely so."

    The Economist, 29 July 2006

     

    Africa: Failure of Doha Talks Bad for Africa

    "Failure for the US and other countries to cut cotton subsidies is fatal for the cotton industry in Africa. Continual dumping of cheap cotton products on world markets lowers returns for African cotton farmers, and leads to continual loss of household employment and earnings […]

    "Implementation of the deal on access to essential drugs such as anti-retroviral and anti-malarial drugs in public health crises in developing countries is uncertain. This rolls back healthcare efforts on the continent with the largest number of AIDS and malaria patients in the world […]

    "Implementation of duty free, quota free market access, aid for trade for LDCs [least developed countries], is in balance under the Development Agenda. These preferences risk being eroded as a result of bilateral trade deals that will be negotiated by granting countries after the failure of the multilateral trading system.

    New Vision (Kampala, Uganda), 6 September 2006

     

    The Collapse of the Doha Round - Broader Implications

    "The Multilateral Trading System is based on the principle of non-discrimination. What is happening and will continue to happen is a vast proliferation of PTAs - preferential trade agreements. While the principle of non-discrimination aims to 'de-politicise' trade, PTAs are primarily political tools. Discrimination will come back with a vengeance.

    "The complex rules and constraints that they impose, especially in respect to rules of origin, both cause trade distortion and significantly increase transaction costs. Especially hard hit will be weaker economies - those that are not 'attractive' enough to be sought after as preferential trading partners - but also smaller and medium sized enterprises that had increasingly engaged in the process of globalisation. Very large Multinational Companies have the means to adjust; smaller firms, especially those from developing countries, do not."

    Evian Group Communiqué, July 2006

     

    The Failure of Doha

    "The consequences of the failure of Doha for Wall Street may come sooner rather than later as the forces of trade and finance collide. […] But an institution (WTO) so weakened by failure will have a hard time standing up to the pressures building on the trading system due to the massive trade and financial imbalances, of which the imbalance between the United States and China is the most threatening.

    "[…A] weakened WTO is likely to see countries - and not just the United States - taking short cuts to resolving trade imbalances by imposing quantitative restrictions, anti-dumping measures and other non-market measures."

    Philip Bowring, International Herald Tribune, 25 July 2006

     

    Commonwealth will make loud and clear call to relaunch Doha

    "When the trade talks collapsed, the baby was thrown out with the bathwater. The Doha round had already made significant gains, with more still to be made. Consider the potential of the deal on access to anti-retroviral and anti-malarial drugs in public health crises in developing countries; a deadline for the end of the worst of European Union agricultural subsidies; a commitment to end US cotton export subsidies; much-improved access for the poorest of poor countries exporting into the markets of developed countries; and the moves to strengthen the supply capabilities of poorer countries through increased 'aid for trade'. None of these gains has been sufficiently quick or total: yet all are a start on which building could continue in the Doha round."

    Don McKinnon, Commonwealth Secretary-General, Financial Times, 1 September 2006

     

    The Future of the WTO

    "When the Doha Round of global trade negotiations derailed on July 23, many observers proclaimed a crisis that threatens the global trading system. This alarm is misleading. The failed negotiations were on the wrong track and unlikely to produce a balanced and widely beneficial new agreement. The aftermath of the crash provides an opportunity to set resumed talks on a better course to achieve the agreed objective of rebalancing trade rules so that developing countries can benefit more."

    Sandra Polaski, Policy Outlook, Carnegie Endowment for International Peace, September 2006

     

    WTO Deadlock: Good News for the Poor and the Environment

    "The failure of the talks allows time to review and reconsider the multilateral trading system in its entirety. This will be welcome news around the world because the proposed WTO deal would have further impoverished the world's poorest people and caused irreparable damage to the environment. Some developing countries have refused to proceed because they too fear that a WTO deal would cause immense harm to millions of small and subsistence farmers."

    Friends of the Earth Europe, EurActiv.com, 24 July 2006



    Contributors: Marija Stefanovic, with Prema de Sousa, Natalie Domeisen, ITC