Bridges Weekly Trade News Digest • Volume 14 • Number 20 • 2nd June 2010

Ministers Review Doha Talks on OECD Sidelines

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High-level trade officials met with WTO Director-General Pascal Lamy in Paris last week to assess progress toward concluding the beleaguered Doha Round of trade talks at the WTO.

The meetings, which occurred on the sidelines of a major conference of the Organisation for Economic Cooperation and Development (OECD), brought together trade ministers and other high-ranking officials from some 20 countries, including OECD members like Australia, the EU, Switzerland and the US as well as a handful of non-OECD members such as Brazil, China, India and South Africa.

The talks underscored the fact that the differences among members remain wide, sources said. The United States in particular has come under fire recently, facing accusations that it is asking for additional access to other countries’ markets without offering adequate concessions in return.

“The gaps indeed are very wide between what the United States says it needs and the rest of the membership,” a high-level Indian official told Bridges in an interview. “No matter how you slice this, that’s the key problem area for moving the negotiations forward.”

US politics to blame?

For several months now, Washington has been calling for major emerging economies like Brazil, China and India to make more concessions in the talks. Such countries have already reaped impressive benefits from past trade liberalisation, the US Trade Representative has said, and it is time for them to take on the additional responsibilities that come with a stronger position in the global marketplace.

But the Indian official, when asked to respond to that notion, deflected the question, saying that the real problem for the Doha talks can be found within US borders.

“The problem is that the industry associations of the United States have strung them up on a pole,” the Indian official said, referring to the US negotiators. “And because of the difficult politics that exist in the United States today, they are unable to come down…They have to be seen to be beating at some doors to get something additional in order for them to present some deal to the Congress.”

“I accept that we are still far away from an endgame, and that endgame can only come when the political situation in the United States is more amenable to a deal,” the official added.

Even the Director-General acknowledged the prominent role that US politics plays in the global trade talks, conceding in an interview with the television network France 24 this week that a deal is unlikely to come before the US holds its mid-term elections in November. Officials in Washington, he explained, have “to cope with a number of conflicting constituencies at home.” He acknowledged, however, that other WTO members including the EU and India face the same problem.

US Trade Representative Ron Kirk defended his country’s stance at a press conference in Paris on Thursday, denying that his office has been hamstrung by domestic politics.

“The least of my concerns is our having TPA or the political environment in Washington,” Kirk said, referring to the Trade Promotion Authority that allows the US president to force a yes-or-no vote on a negotiated trade deal. “I think to some degree the continued highlighting of [US domestic politics] by some members is I think more for the benefit of their avoiding the type of difficult negotiations that are necessary to yield a result than it is any real prediction of what our US Congress would do,” Kirk added.

The USTR said that his office is “committed to engagement” in the Doha talks. He also called for “more focused and serious attention to completing our work in services and rules,” two areas of particular interest to the United States.

But delegations have expressed uncertainty as to what the US means in asking for the emerging economies to take on more “responsibility” in the talks. The Indian official noted that the Doha Round has officially been a “development round” since its launch in the Qatari capital in 2001. “Can you start, at this stage after nine years, differentiating between developing countries?” the official asked. “This will open up the whole negotiation, it will unravel the whole process, if we take this to its logical end.”

Sources reported that WTO Director-General Pascal Lamy stressed to officials in Paris last week that the negotiations will require “added quantum,” a term that some officials took to mean additional concessions from developing countries to accommodate US demands. Others were not so sure.

“Well, in the WTO we keep inventing new jargon every week, so I think you should take all of these things with a pinch of salt,” the Indian official said. “The point at the end of the day is ‘who is to give what?’ and ‘what is a balanced outcome?’ - and that is the key question for all of us.”

Lamy has long stressed that a global trade deal would serve as a bulwark against protectionism amid the ongoing economic downturn. “As long as unemployment stays high, the danger of protectionism will remain,” Lamy told French newspaper La Tribune on Wednesday.

ICTSD reporting; “Pascal Lamy (OMC): ‘tant que le chômage ne diminuera pas, le danger protectionniste demeurera,’” LA TRIBUNE, 2 June 2010. “The Business Interview: Pascal Lamy, Director General, World Trade Organization,” FRANCE 24, 1 June 2010.