Farm trade and stalled reforms
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.