Bridges Weekly Trade News Digest • Volume 13 • Number 32 • 23rd September 2009

‘Cautious’ Lamy Presents Doha Road-Map, Previews G20

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WTO Director-General Pascal Lamy presented delegates with a packed schedule of meetings over the next three months at a meeting of the Trade Negotiations Committee on Tuesday morning. But the mood among trade officials “is sombre,” one delegate said, as many continue to question whether domestic politics in the United States will prevent any progress in the talks.

Lamy’s remarks to open the meeting departed slightly from the ever-optimistic tone that he has usually adopted in past addresses to delegates.

“At this stage I remain cautious in my forecast. It would be premature for me to predict today that the necessary political engagement will in fact take place over the next three months,” Lamy said. “We should be in a position to judge by December whether or not this has happened.”

Lamy outlined what he called an “intensive, structured programme of work” (available here) to guide delegates as they try to hammer out remaining differences in the Doha Round trade talks, which have been ambling along but avoiding conclusion for nearly eight years. The agenda, which was negotiated by trade delegates last week, sets out meetings almost every day between now and 18 December, when the organisation will break for the winter holidays, and includes several sessions with capital-based officials.

The “regular presence” of these senior negotiators in Geneva “will be an important factor in joining up the dots of the negotiation and making sure that that political commitment leads to action,” Lamy told the members. Senior officials will return to Geneva the weeks of 19 October, 23 November and 16 December.

But Lamy acknowledged that political difficulties lie ahead, and that the amount of progress that negotiators make in the talks will ultimately depend on the will of the members. “A work programme in itself, as necessary as it may be, will not deliver a substantive result,” he told delegates.

The negotiations are at “a very delicate crossroads,” Eckart Guth, European Ambassador to the WTO, said in an interview. The work plan has been set, “but now it needs to be filled with life and substance.” He added that a ‘reality check’ would come at some point between now and the end of the year.

Most delegates who spoke to Bridges this week seemed doubtful of a positive outcome to the talks this autumn. In describing last week’s meetings, various delegates described their colleagues as ‘going through the motions’, ‘play acting’, and ‘going around in circles’. “Many of us are playing the game to keep the thing alive,” one official acknowledged.

All eyes on Washington

The delegates who spoke to Bridges this week universally blamed a lack of political will in the United States for the slow progress in the talks, a theme that has emerged frequently in recent weeks (see Bridges Weekly, 16 September 2009, http://ictsd.net/i/news/bridgesweekly/55284/).

Officials from Washington quibbled about process during last week’s meetings, several sources said, and failed to bring anything new to the table. To the consternation of many, the US delegation has indicated that it wants to re-open parts of the draft texts that were presented by the chairs of the negotiating groups on agriculture and industrial goods in December 2008. Washington is alone in its desire to re-visit the texts, several delegates said.

“We are not satisfied either, but we can live with it,” Guth said of the texts now on the table. Officials in Washington “want to have the cherry on the cake,” he added.

But US negotiators say their hands are tied by politics back in Washington, and officials in Geneva recognise that trade is not the highest priority on US President Barack Obama’s agenda, as fights over healthcare reform, climate change, and revamping the domestic economy have largely taken centre stage.

“There is a huge uncertainty whether the United States will be able to bridge the gaps,” Guth acknowledged.

Other delegates concurred. One official blamed the recent WTO ruling on the retaliation that Brazil can take against US cotton subsidies for stirring up anti-WTO sentiment on Capitol Hill. Other observers have pointed to Obama’s decision earlier this month to impose 35 percent tariffs on imports of Chinese tyres as a sign of his administration’s reluctance to embrace free trade (see Bridges Weekly, 16 September 2009, http://ictsd.net/i/news/bridgesweekly/55281/).

But Michael Derham, a fellow at the Progressive Policy Institute in Washington, says trade observers should be careful not to over-interpret the president’s recent move. “I don’t see it as an indication of a concerted campaign of protectionist policies,” Derham said in an interview, referring to the tyre tariffs.

“Every administration in DC has to show its bona fides to US domestic groups,” Derham added. “They have to establish themselves before than can really push their own agendas.”

Derham pointed out that Congress is moving on other trade issues, including a potential new deal with Panama and the extension of a set of trade preferences to Andean countries that is set to expire at the end of the year. If a Doha deal were to show up for a vote, the lawmakers would consider it, he said.

Back in Geneva, many delegations remain wary. In speeches to delegates after Lamy’s address to the TNC, both Costa Rica and South Africa reportedly called on “one delegation” to show more flexibility in the talks. The US representative did not intervene, sources said.

G20 preview

In his address on Tuesday, Lamy also outlined the message that he plans to deliver later this week when he drops in on a summit of heads of state from the Group of 20 major economic powers.

“I will tell them, in a nutshell, that we in Geneva have done what they asked us to do. They now have the road mapped out, but they still have to walk it,” Lamy told delegates.

At a summit in L’Aquila, Italy in July, the G8+G5 countries called for a conclusion of the Doha Round before the end of 2010, a call that has been echoed by trade ministers and heads of state around the world many times since. Another iteration of the vow is expected to emerge from the Pittsburgh summit, but at this point, strong words alone will do little to spur progress in the Doha talks.

“Leadership is about responsibility,” Lamy told delegates. “Failure to act - not just in Pittsburgh, but also here in Geneva - will be hard felt by the entire international community at this time of economic crisis.”

ICTSD reporting.