WTO fiasco a blow to Doha

Ndamu Sandu

THE collapse of trade talks at the World Trade Organisation (WTO) Fifth Ministerial Meeting in Cancun, Mexico, could be a blow to the Doha Developmental Agenda, analysts said

this week.

In Doha trade ministers set January 2005 as the deadline for the completion of negotiations.

Talks in Cancun faltered amid a serious rift between rich and poor nations on one contentious issue, agriculture, the backbone of economies in the developing world.

Developed countries refused to remove huge subsidies they give to their farmers.

Developing countries view subsidies as a stumbling block as farmers from the developed world would flood the market with their prices thereby affecting the prices of commodities on the world market.

Deadlock in Cancun revolved around four “Singapore issues” pushed by Japan and the European Union.

The Singapore issues included how countries treat foreign investors and standards for anti monopoly and cartel laws.

They also include greater transparency in government purchasing, which might help foreign companies win public sector business and making items such as customs procedures simpler thereby facilitating trade.

These issues were first mooted at an earlier meeting in 1998 but were passed to Cancun at the Fourth Ministerial Meeting in Doha in 2001.

This is not the first time that WTO members have disagreed on agriculture.

In January members rejected the Agreement on Agriculture (AoA) in Geneva.

The review hearing focused on a draft text of Modalities on the Agreement on Agriculture issued by chief WTO agronomist Stuart Harbinson.

Referred to as the Harbinson Draft, participants rejected it citing its inadequacy to address the concerns of developing nations on agricultural issues.

In a statement released at the end of the review hearing, participants said: “The draft text reveals the emptiness of the Doha Ministerial Declaration’s stated intention of placing development, food security and rural livelihoods at the heart of the Doha round.”

Analysts say the aborted talks would have a bearing on world trade systems, as it would be fragmented into regional blocs.

Besides the joining of new members Nepal and Cambodia, like its predecessors, the Fifth Ministerial Meeting was no different.

The September 10 to 14 ministerial meeting was a replay of the stalemate in previous meetings, which has led to the customary North-South political divide.

Analysts say the collapse of the talks was inevitable considering the non-transparent and non-accountable system of decision-making.

They say this had contributed to the crisis of legitimacy of WTO.

Real decisions, analysts say, were made in backrooms by informal caucuses whose members were not determined by formal rules and votes but by informal agreements among significant players, mainly the developed countries.

That talks would collapse on agriculture, analysts say, was inevitable, as it is the mainstay of Third World economies.

However trade ministers agreed to reconvene by December 15, to reassess the future of trade talks.