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TRADE: Doha Round Crumbles to Dust

Gustavo Capdevila

GENEVA, Jul 29 2008 (IPS) - The Doha Round of multilateral trade talks was brought crashing down late Tuesday by the same discrepancies between rich and poor countries that have marked the nearly seven years of negotiations from the start.

An insurmountable rift between the United States on one hand and China and India on the other ended the emergency conference of ministers called by the World Trade Organisation (WTO), which had stretched into its ninth day of sessions.

Argentine Foreign Minister Jorge Taiana interpreted the collapse of the talks as the failure of an attempt by industrialised countries to give very little and ask for a lot, which was simply not accepted, in general terms, by the developing countries, he told IPS.

What ultimately sparked this international disaster was an issue that is dear to developing countries: the establishment of a mechanism of special safeguards that would allow developing countries to raise tariffs on farm imports when they reached a certain level and began to threaten the livelihoods of poor farmers

“It is unbelievable that we have failed over one issue. Not that the issue is not important for some countries, but many other much more intractable issues were overcome,” said Brazilian Foreign Minister Celso Amorim.

WTO Director General Pascal Lamy said that agreements had been reached on 18 issues out of a list of 20, but that the gap could not be closed on number 19.

The United States opposed the safeguard clauses, arguing that they could give rise to abuses, while China and India demanded the mechanism as a way of defending livelihoods, food security and rural development for farmers in developing countries.

The difference kept the ministers from the roughly 30 countries who met last week and the representatives of the rest of the WTO’s 153 member states from reaching an agreement on the parameters for talks on agriculture and non-agricultural market access (NAMA, or industrial products).

Conceived in the Qatari capital in November 2001 with the aim of sending a message of solidarity to a world shaken by the 9/11 terrorist attacks on New York and Washington, the Doha Round of talks is failing against a backdrop of threats of new crises, involving food and oil prices and climate change.

“In the face of a global food price crisis, we simply could not agree to a result that would raise more barriers to world food trade,” said U.S. Trade Representative Susan Schwab.

Carin Smaller, of the Institute for Agriculture and Trade Policy (IATP), said “the U.S. argued that opening markets was the best way to achieve food security and to promote livelihoods.” “India and China, in contrast, with the support of the majority of developing country members, argued for a strong safeguard mechanism to protect food security and livelihoods in the event of major disruptions to agriculture markets, she said.

Mexico’s deputy Finance Minister Beatriz Leycegui said that the failure of the Doha Round is a loss to the whole world, because it comes at a time of severe economic crisis, in the midst of protectionism and loss of credibility for the multilateral system.

Under these conditions, reaching an agreement was urgent, she said.

Lamy accepted that the Doha meeting had collapsed. “We will have to let the dust settle a bit,” he said about future WTO negotiations. However, he insisted that he had not “thrown in the towel.”

Alfredo Chiaradía, secretary of international trade relations at the Argentine Foreign Ministry, said that in the last meeting of ministers Tuesday, some expressed an interest in attempting to revive the talks.

Leycegui said Mexico had insisted on not “tossing in the garbage everything that has been achieved” in the nine days of negotiations. “It is frustrating because we thought an agreement was near, but political commitment was lacking,” she added.

Anne-Laure Constantin, another IATP expert, told IPS that she hoped that the WTO member countries “will be creative enough to think about another way to address trade at the multilateral level, which is more adapted to the new conditions and really helps countries deal with the crises they have to face in food, energy and climate.’’

The Doha talks were supposed to be a development round, to favour the poorest countries, which makes their failure especially frustrating, said Taiana.

Jeremy Hobbs, director of Oxfam International, said “This is a major disappointment. At a time when food and fuel prices are high and the global economic outlook is uncertain, the world’s poorest people are increasingly vulnerable. A decent trade deal could have given them a chance to prevent worsening poverty.”

Aftab Alam Khan of ActionAid, said “The responsibility for the failure lies squarely with the U.S. and EU, who could not think beyond the interests of their huge transnational businesses that want to grab more and more market opportunities in poor countries. For the U.S. and the EU to blame China and India for the collapse is just laughable.”

In Amorim’s view, “any outside observer would not believe that after the progress made we were not able to conclude the talks.”

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