The Hindu Business Line : Back to the WTO Doha Round

The good thing about the Davos meeting is that it has straightaway injected a sense of urgency into the negotiating process. A detailed, though informal, timetable is being circulated of what has to be accomplished and by when.

THE Davos meeting was important to countries such as India not merely because of what happened there in terms of publicising the growth prospects and potential of the Indian economy but also for the role played by the event to set the Doha Round of multilateral negotiations in motion once again after the Hong Kong Ministerial, where very little by way of real progress towards the completion of the round was accomplished. So this is not an inappropriate moment to consider what really happened at Davos and what the environment is like for the continuation of the Doha process. It would have been foolish to have expected a "breakthrough" at Davos itself for the simple reason that no negotiations — overt or covert — took place during the five or six weeks after the conclusion of the Hong Kong Ministerial.

On the other hand, what did happen at Davos, namely, the road-mapping of what is to be done as laid down at Hong Kong, was entirely in order if one sees the Davos mini-ministerial (attended by around 25 member states on January 27-28) as the resumption point of the Doha Round negotiating process.

In fact, the good thing about the Davos meeting is that it has straightaway injected a sense of urgency into the negotiating process with a detailed, though informal, timetable being circulated of what has to be accomplished and by when. Among other things, the document, which is likely to be discussed at Geneva very shortly, lists as many as 33 specific subjects which will have to be got through by the negotiators by settled dates.

None of these subjects is new in the sense that all of them have figured at Hong Kong. Well-known among these are the April and July deadlines for agriculture and non-agricultural market access issues. But, as one report says, a number of new procedural guidelines have been introduced , the most important of these being "July dates for the submission for consolidated draft texts on rules (including anti-dumping and fisheries subsidies) as well as the first full draft on trade facilitation". Also, "working documents" on dispute settlement understanding (DSU) and intellectual property rights (TRIPS) negotiations "are also now expected in July". Further, the schedule lays down that developed country members will have to "notify the means by which they will implement the decision" to provide duty- and quota-free access to exports from least-developed countries (LDCs) by September, with developing countries ``declaring themselves in a position to do so'' to follow suit by December.

The Committee for Trade and Development (CTD) would conduct its first Hong Kong-mandated annual review of members' efforts to provide such market access to LDC exports in November. It also suggests that the May, July, and October General Council meetings focus on the remaining proposals for changes to the special and differential treatment (S&D) provisions of specific WTO agreements". The Hong Kong Declaration has called for a report on these issues to be made to the General Council by December 2006. The work of the negotiators, therefore, has been cut out and it remains to be seen whether 2006 will be any different from 2005 when nearly every deadline of consequence was broken. The next "check", so to speak, will be held in mid-March or even earlier when the US, the EU, Brazil, India, Australia and Japan have said they will meet.

One hopes for the best, in the interests of multilateral trade and specially for the economic growth prospects of the developing world (including the LDCs), but the point should be made that, as things stand now, the outlook is not any less pessimistic than it was in the run-up to Hong Kong and immediately after it.

According to one report, a January survey of negotiators, conducted by the Institute for International Business, Economics and Law at the University of Adelaide, revealed that only two per cent believed that the end-April deadline "for a comprehensive agreement on `full modalities' — structures and numbers for subsidy and tariff cuts, as well as exceptions — for the agriculture and non-agriculture market access (NAMA) negotiations" would be met. The poll also found that "not one of the Geneva-based negotiators surveyed believed that the Doha Round would be wrapped up by the end of this year".

Certainly, these findings do not augur well for the prospects of the Doha Round, the general impression of pessimism being underscored by the first statements that have been made on their negotiating stances by leaders of the US and EU delegations, not to speak of the consistent Defence being put up on behalf of the developing world by representatives such as the Brazilian Foreign Minister, Mr Celso Amorin, and the Union Commerce Minister, Mr Kamal Nath. In fact, the EU position has been nothing short of remarkable for its hard line, the clear inference being that it is in battle-mode even before the next round of negotiations has begun, probably sending the message that there is no way in which Washington and the developing countries can get Brussels to change its line unless appreciable concessions are made from their side.

The EU Trade Commissioner, Mr Peter Mandelson, is reported to have said at Davos that the EU would lose "next to nothing" if the talks failed, which squarely gives the world an idea of the importance Brussels attaches to the process of multilateral trade liberalisation being undertaken under the auspices of the WTO.

Even Washington has refrained till now from adopting such a harsh stand, at least in public. As far as the US is concerned, there is little doubt that it is under constant pressure from Brussels to relent on the farm and export subsidy issue, but Washington has also chosen to train its guns on the developing world, in general, tactically citing the plight of the LDCs to camouflage its real targets. The US Trade Representative, Mr Rob Portman, is reported to have said at Davos that, "in an ideal world", the big developing countries (meaning Brazil, India, etc) should simultaneously open their goods market along with the opening up of the markets of the developed world. He added: "That would be a lot to ask because it involves a lot of risks on the part of all the parties, but I think that is what is needed now". Clearly, this is hardly a veiled hint on opting for a quid pro quo from the developing countries in the sense that "I will concede a point or two in agriculture and other areas if you open up on the NAMA front".

Even if it is likely that New Delhi may bend a bit on this issue in the interests of getting some movement in the talks at a later stage, Mr Kamal Nath did extremely well to counter this ploy immediately with the remark that Washington and Brussels should not be compensated for "agreeing to stop doing what they ought not to have been doing in any case".

While it is to be expected that the new-found unity among developing countries in the WTO will hold till the Doha Round negotiations end, of some concern are the disturbing noises being made by certain African member-states which could, in the end, force the developing world to concede more than it justifiably ought to in the interests of successfully concluding the Doha Development Round.

One very clear example of this is provided by the stance of Egypt which feels, among other things, that sacrifices will have to be made by every one concerned. Thus, the Egyptian Trade Minister, Mr Rachid Mohammad Rachid, who also chairs the Africa Group of nations in the trade talks, is reported to have said: "The US and the G-20 are expecting the EU to come forward with more agricultural market access. I think we need to come forward with offers on ... (industrial goods) and services.

The idea that everyone has to wait for the EU is not Egypt's view, and it is not the Africa Group's view". Brussels, it seems, has been doing its homework diligently, and this is perhaps why Mr Mandelson was bold enough to make the sort of statement he made at Davos in January.