Farm trade and stalled re­forms

The Pak Banker - - OPINION - D. Ravi Kanth

Atale of two fail­ures on Fri­day un­der­lined a com­mon nar­ra­tive con­fronting global trade. Mem­bers at the World Trade Or­ga­ni­za­tion (WTO) in Geneva, Switzer­land, failed to ar­rive at a work pro­gramme for con­clud­ing the long-pend­ing Doha trade ne­go­ti­a­tions. Talks among 12 coun­tries to lib­er­al­ize trade on the Pa­cific re­gion also broke down in the Hawai­ian is­land of Maui. Both the fi­as­cos high­lighted the im­por­tance of re­form­ing global farm trade. Iron­i­cally, the US, the world's lead­ing ex­porter of farm prod­ucts of around $150 bil­lion, is at the cen­tre of both these de­vel­op­ments.

To start with, the blue­print for wrap­ping up the 14-year-old Doha trade ne­go­ti­a­tions be­gan last year. The ebul­lient di­rec­tor gen­eral of the WTO, Roberto Azevedo, took upon him­self the mam­moth task of con­clud­ing the round within 12 months, by 15 De­cem­ber. Af­ter clinch­ing an agree­ment on trade fa­cil­i­ta­tion for re­mov­ing cus­toms-re­lated bot­tle­necks, Azevedo has re­mained con­fi­dent he would add another jewel to his crown by con­clud­ing the Doha round. The trade fa­cil­i­ta­tion agree­ment, though, part of the Doha De­vel­op­ment Agenda (DDA), was cer­tainly not the main is­sue. If any­thing, it was plucked out of the DDA at the in­sis­tence of the ma­jor in­dus­tri­al­ized coun­tries led by the US. The Euro­pean Union and the US also de­served credit for their lead­er­ship in launch­ing the Doha round in 2001. Agri­cul­ture, how­ever, re­mained the first among equals in the Doha agenda. Other ar­eas in­clude re­duc­ing tar­iffs on in­dus­trial goods, lib­er­al­iz­ing trade in ser­vices, im­prov­ing anti-dump­ing and anti-sub­sidy (coun­ter­vail­ing) mea­sures, strength­en­ing de­vel­op­men­tal flex­i­bil­i­ties for de­vel­op­ing and poor coun­tries and so on.

Con­sid­er­able progress was made dur­ing the ne­go­ti­a­tions on agri­cul­ture. For ex­am­ple, af­ter a de­ba­cle at the Can­cun min­is­te­rial meet­ing in 2003, trade min­is­ters had agreed on what was called the July 2004 frame­work agree­ment that clar­i­fied how the dif­fer­ent ar­eas of the DDA, par­tic­u­larly agri­cul­ture, will be ad­dressed. Sub­se­quently, the Hong Kong min­is­te­rial dec­la­ra­tion in 2005 fur­ther con­cretized the spe­cific el­e­ments in agri­cul­ture, in­clud­ing cot­ton an area of life-and-death for the poor­est farm­ers in four West African states, in­dus­trial goods, and ser­vices among oth­ers. Even though the Doha ne­go­ti­a­tions broke down in 2006, they were re­vived in 2007 largely due to the fire­side chats ini­ti­ated by then chair of the agri­cul­ture ne­go­ti­a­tions, Craw­ford Fal­coner of New Zealand. De­spite con­sid­er­able dis­agree­ments, Fal­coner's ef­forts brought about a sea change in the Doha agri­cul­ture ne­go­ti­a­tions. He pro­duced sev­eral draft ne­go­ti­at­ing texts cul­mi­nat­ing in what is pop­u­larly called the Rev.4 or the fourth re­vised draft text of modal­i­ties in De­cem­ber 2008.

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