Column Deadlocked on Doha

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The multilateral trading system, after having fostered nearly six decades of expanded trade and prosperity worldwide, is now in crisis. Despite its best intentions, the current round of trade negotiations—the Doha Development Agenda (DDA)—has proven exceptionally susceptible to deadlock. Trade negotiators in the World Trade Organization (WTO) had launched the DDA in November 2001, and had planned to complete it by January 2005. Almost seven turbulent years later—after several failed ministerial and mini-ministerial conferences and repeatedly missed deadlines—we still do not have an agreement. The declining faith in multilateralism is reflected in the proliferation of regional and bilateral trade arrangements: 387 RTAs had been notified to the GATT/WTO by July 2007. The forthcoming mini-ministerial talks, to be held in Geneva from 21 July, provide a crucial opportunity for trade and foreign ministers to rescue the DDA.

Much is at stake. A World Bank study estimates that global gains would be in the range of $95-120 billion per year through an agreement based on the Hong Kong Ministerial Declaration of 2005 (which represents a narrower agenda than the one that was launched at Doha in 2001). But if the Doha negotiations fail, more will be lost than the gains from trade—namely the opportunity to lift billions of peoples worldwide out of poverty. The WTO provides stability to the world of international trade by locking in the commitments of states to lower their tariff barriers through a system of rules that is enforceable through its Dispute Settlement Mechanism. A failed DDA will undermine the credibility of the WTO, and also the system of rules that it governs. Those who wish for a weakened WTO do so at their own peril at even the best of times; to risk the weakening of the WTO in the perilous economic times that we live in today would be catastrophic. And yet, if so much is at stake, why has an agreement proven so difficult to reach?