Column : A done deal?

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: “What I saw is Ron Kirk and Anand Sharma clearly engaging in a process that should lead to the conclusion of the round sometime next year.” This quote has been attributed to Pascal Lamy, after the Cairns group meeting in Bali. Ron Kirk is United States Trade Representative (USTR). Sharma of course is India’s Commerce Minister. China, Japan, US, India and EU aren’t part of Cairns group, which primarily consists of agro-product exporters. However, these countries were present in Bali. Sharma, visiting the US now, said in a recent interview that the impasse is over. So where do we stand?

The Doha impasse has been over agriculture, issues over NAMA (non-agricultural market access) and services are relatively minor. There was a July 2008 package, designed to complete Doha Work Programme (DWP) by end-2008. And in July 2008, Lamy had a “to do” list of 20 items. This is what we were told then, the “he” referring to Lamy. “He told a press conference afterwards that out of a “to-do list” of 20 topics, 18 had seen positions converge but the gaps could not narrow on the 19—the special safeguard mechanism (SSM) for developing countries, which would allow developing countries to raise tariffs temporarily in order to deal with import surges and price falls.

The difference boiled down to some wanting a high “trigger” (a large import surge needed to trigger the tariff increase) in order to avoid the safeguard being triggered by normal trade growth, while others wanted a lower trigger so that the safeguard could be easier to use and more useful, he said.

Incidentally, item no. 20 was cotton subsidies. Cairns group and those who want faster agricultural liberalisation may complain about limited liberalisation on domestic support and export subsidies in the July 2008 package (and recent protectionism in US and EU), but ambitions, so to speak, had already been lowered in July 2008. Increases in food prices prior to financial crisis also dampened some enthusiasm for agricultural trade liberalisation, both among agro exporters and importers.