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Missing the April deadline

Members of the WTO who missed the April 30 deadline for arriving at the modalities for agriculture and non-agricultural market access (NAMA) have been exhorted by Secretary-General Pascal Lamy to have a "shared sense of urgency" and strive for an agreement. No new date has been set, but obviously an early breakthrough, however improbable it might seem, would be crucial. It is clear that, even going by the chequered history of the Doha round, the latest failure is more than just the missing of yet another deadline. So much hope was pinned on the December 2005 Hong Kong Ministerial meet to take the Doha Development round substantially forward: the expectation was that two-thirds of the agenda would be successfully negotiated, leaving the balance to be wrapped up in 2006. However, the only significant achievement of the Hong Kong meet was to keep alive the Doha round, and the spirit of multilateral negotiations it embodied. All the 149 countries unanimously approved the draft text treaty. Yet the fact that there was no other result of note brought into sharp focus the major points of disagreement among the trading nations.

The issues of developed countries reducing agricultural subsidies and the lowering of the tariffs for industrial products have remained unresolved. In Hong Kong, India and other developing countries negotiating as a bloc wrested one important concession from the EU and the U.S. — the phasing out of all subsidies by 2013. To be really effective, the loopholes that allow hidden subsidies in export credit and food aid will have to be plugged. Moreover, the related contentious issue of domestic support has eluded an agreement. As the subsequent bickering between the U.S. and the EU shows, the differences within the developed world — always a disruptive factor — have actually widened after Hong Kong. As for NAMA, "the principle of less than full reciprocity" was accepted and developing countries are not bound to cut tariffs to the same extent as developed countries. Here again, the gains from the acceptance of such important principles can be consolidated only if the complex modalities are worked out and agreed upon. Four months after Hong Kong, there has been little progress in resolving the two contentious issues and in breaking new ground in services. India and a few other developing countries have pointed out that development issues that were supposed to occupy centre stage have been relegated to the background. Yet no one disputes the fact that no trade agenda, let alone the one so momentous as the Doha round, can ever move forward without broad political support. The future of the round and the very efficacy of multilateral trade negotiations depend on how quickly trade negotiators, who will be meeting in Geneva, succeed in breaking the impasse.

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