Multilateral trading arrangements are in crisis
The WTO must survive. It provides for transparent dialogue on an equal footing
The 11th ministerial conference of the World Trade Organization (WTO) has failed to arrive at any decision. Without naming the US, India’s official statement has blamed its opposition to grant a permanent solution on public stock holding (PSH) for food security for the failure. In an earlier statement, India had warned that a failure to resolve the PSH issue could irreversibly damage the credibility of the WTO as an institution.
Such statements shouldn’t be taken as hyperbole. The multilateral trading arrangement is in deep crisis. This is the second successive ministerial in which the WTO has failed to agree upon a work programme. In his speech at the closing ceremony, director general Roberto Azevêdo has underlined the need for keeping development and inclusiveness at the heart of WTO’S work. He has also warned against expecting both multilateralism and walking out with everything you wanted to work at the same time. If the Doha Round is to succeed, developed countries have to be willing to grant more concessions at the WTO.
Despite all its limitations, the WTO provides to its members an opportunity for transparent dialogue on an equal footing. There cannot be a decision unless there is unanimity, which means no one can play big brother. There has also been a reasonable degree of success in at least bringing the issues of link between trade and development on the agenda of WTO. This is in stark contrast to the opaque manner in which mega-regional trade agreements are being negotiated. India’s own regional trade agreements have led to a faster rise in imports than exports. A big reason for this is our failure to augment domestic economic capabilities to reap export markets which have opened up through such treaties. And last, but not the least, it was China that stood firmly with India against US pressure in this ministerial. Solidarity among developing countries is a prerequisite for moving towards a more equitable global trade order.