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Cancun meet collapses after standoff

By C. Rammanohar Reddy

CANCUN SEPT. 15. The fifth ministerial conference of the World Trade Organisation was abandoned on Sunday without reaching an agreement on how to impart a new momentum to the Doha round of trade talks, after it was clear that many groups of developing countries were not going to accept the WTO proposals which they felt would hurt their interests.

The conference did end by issuing a face-saving statement, which sends all the trade proposals on the table to the WTO headquarters in Geneva for discussion by officials. But the failure at Cancun makes it highly unlikely that the WTO's Doha round will be completed by the scheduled date of 2005. The larger question is if the Doha round itself can be salvaged from the collapse at Cancun.

The Union Minister for Commerce and Industry, Arun Jaitley, said the meeting could not end with a ministerial declaration because the draft text that the Ministers had been asked to approve "did not reflect the concerns of the developing and least developed countries".

Singapore issues

The conference disintegrated after a morning of dramatic developments, when one developing country after another refused to say "yes" to the launch of negotiations on the four controversial Singapore issues of investment, competition policies, transparency in government procurement and trade facilitation. There was no headway even after the European Union, the main demander since 1996 on the Singapore issues, took the extreme step of offering to permanently take out its proposal for talks on treaties in investment and competition policies. The final straw came when groups of countries in Africa refused to consider WTO talks on an agreement on trade facilitation on the ground that uniform customs procedures would impose heavy costs and require administrative skills that were beyond their ability.

The conference Chairman, Luis Ernesto Derbez of Mexico, then decided to end the negotiations among a group of 30 countries since, as Mr. Derbez later said, "it was my assessment that a consensus agreement would not be possible on the ministerial declaration." The chairman took the decision even before intensive discussions could begin on the more important issue of agriculture, where positions between the rich and poor countries were just as wide apart as on the Singapore issues.

Mr. Jaitley said, "India would have preferred a declaration addressing our concerns, but this did not happen." Among the advanced economies, which many see as responsible for contributing to the Cancun failure because of their unreasonable demands, Pascal Lamy, the European Commission Trade Commissioner, observed that the collapse was "a lost opportunity for all of us, developed and developing countries alike." Mr. Lamy said the E.U. "will not play the blame game and we will remain open to reviving this process".

U.S. blame game

The United States Trade Representative, Robert Zoellick, however, was ready to play the blame game. The USTR said "rhetoric and pontification" of the kind heard in the United Nations during the 1970s were heard in Cancun as well.

"Large developing countries spent too much time on tactics not negotiation and the smaller developing countries followed suit," he said in an obvious reference to India and Brazil.

One of the developments of note at Cancun was the emergence of the G-21 developing countries which played an important role in countering very modest E.U.-U.S. proposals for reform of agriculture with their own aggressive proposals. After the conference ended, Ceslo Amorin, Brazil's Foreign Minister, said the G-21 looked forward to picking up the pieces from the Cancun debris and resuming work on the business of reforming agriculture by taking into account the needs of the developing countries.

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