[EMBASSY VOICE]World trade talks in Doha must be revivedThe suspension of negotiations in the World Trade Organization’s Doha Round is a painful blow for the global trading system. The potential costs of an indefinite suspension are high, both politically and economically.
The suspension has dented the credibility of the WTO at a time of global economic and geopolitical uncertainty, when all states need to jointly harness globalization to reap its benefits for the highest number of people. Without the Doha Round, the WTO’s central commitment to progressive trade liberalization and development through free and fair trade seems empty to many.
The great tragedy of the stalemate is that considerable progress had already been made: not just in the closely scrutinized agriculture negotiations, but in the groups working on the service trade and adapting WTO rules to help poorer countries integrate better in the global trading system. Far from a “Doha Lite” agreement, what is already on the table in the Doha Round far outstrips the achievements of previous GATT Trade Rounds.
We risk losing what was supposed to be the centerpiece of the Doha Round: the consolidation of a program of fundamental reforms of farm subsidies in the rich world. Europe has led the way and wants to lock in its expansive 2003 Common Agricultural Policy reforms at the WTO and make them irreversible. The United States and others must commit to a similar reform, which has not yet begun to happen. Only multilateral negotiations would make that possible.
During these negotiations, the EU was able to make a significant improvement in its agricultural market access offer, bringing its average cuts close to the level requested by the G20 group of developing countries, provided others move in parallel. The G20 group of developing countries acknowledged the flexibility the EU had shown.
The EU offered a 100 percent elimination of export subsidies. These would reduce EU exports of sugar by 5 million tons and of fresh milk by 8 million tons. EU poultry exports would fall by a quarter. All of these reductions would open markets for others. It offered a 75-percent reduction in trade-distorting domestic support. It showed a readiness to go to a 50-percent average tariff cut: a further step from our existing tabled offer of 39-percent average farm tariff cuts to close to the 51.5 percent for which developing countries were asking. This is a substantial move, and by far the deepest farm tariff cuts the EU has ever offered in a multilateral negotiation; We also indicated we were ready to talk about the number and treatment of sensitive products: Sensitive product tariffs will be cut, and their tariff rate quota levels expanded to allow new market access. This is more, much more than anyone would have expected from the EU.
And the EU is not giving up on this round. We have stuck with it, paid into it, and given a lot.
In the short term we should salvage the negotiations with a development package on which we have already agreed. These things could be adopted as a stand-alone deal.
WTO members could sign off on a new multi-billion euro package of capacity-building “Aid for Trade” that will help build the roads and ports and increase the ability to meet export standards that poorer countries need to trade. The Hong Kong agreement on duty-free, quota-free market access to the markets of all developed countries for all of the least-developed countries should be implemented ― and other countries should match the EU in offering it for all products and all countries. These and other measures should be closely considered by WTO members over the weeks to come.
But we need to continue to insist that a true development outcome depends on completing the single undertaking of the round as originally envisioned at Doha.
A successful Doha Round would add hundreds of billions of euros in new trade to the global economy and everyone benefits. Farm reform, new farm trade and also new trade in industrial goods and services are all development goals. This is why the wider Doha negotiation must be revived.
While we work to get Doha back on track, Europe’s trade agenda will inevitably have to move on. Europe will continue to explore the possibility of regional trade agreements with Asean, and other countries. But these things are not alternatives to Doha or the multilateral system ― they complement it.
No bilateral agreement can reproduce the global benefits of a multilateral deal. The WTO will remain the essential platform for ensuring Europe’s interests and the interests of development are recognized in the global trading system.
The EU will work to ensure that Doha succeeds. I dearly hope that, when the smoke has cleared, others will want to do the same. The EU stands ready to carry on where we have left off.
* The writer is the European Commissioner for External Trade.
by Peter Mandelson