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Home > Blogs > Anthony Harrington > WTO and free trade—Dead as the proverbial Doha?

WTO and free trade—Dead as the proverbial Doha?

Finance Blogger: Anthony Harrington Anthony Harrington

On November 20, 2001, the Doha Declaration came into existence. Following the disastrous crash and the ensuing slowdown (which looked bad at the time but wasn’t a patch on the 2008/2009 crash), the countries of the world signed up to an optimistic development agenda. This committed them to work to enhance the global multilateral trading system, as embodied in the World Trade Organization (WTO), which, ministers noted, “has contributed significantly to economic growth, development and employment throughout the last fifty years.”

“We therefore strongly reaffirm the principles and objectives set out in the Marrakesh Agreement [remember that one, anyone?] establishing the WTO, and pledge to reject the use of protectionism,” the ministerial declaration proudly announced. The problem for WTO Director-General Pascal Lamy is that, despite all the major nations and many of the minor ones repeating these noble sentiments year after year, the recent crash has seen protectionism run rampant.

Lamy and his team are currently hard at work preparing for a major “stocktaking” exercise scheduled for March 2010. The aim, after almost a decade of stalled progress, is, and I quote, “to assess whether concluding the Doha Round in 2010 ‘is doable’ [Lamy’s quotation marks].” It is not that nothing is happening. As Lamy himself pointed out in his address to the WTO General Council on 17 December 2009, at the last full Ministerial Conference, there were some 250 bilateral and “plurilateral” meetings, across a wide range of topics and subject areas.

Nor can one sniff at the objectives, which are tremendously worthy, such as trying to find ways of enabling the least developed countries (LDCs) to get a fairer shot at engaging in global trade. Part of the problem Lamy faces is that there are just so many ways, both through tariffs and through a range of non-tariff barriers, for countries to block free trade while favoring this or that sector in their own economies.

Nor is “free trade” always the innocent, good-for-everyone panacea it is held out to be. Fair trade is one thing, dumping vast quantities of state-subsidized goods on another country, thereby killing its indigenous industries, is another thing entirely. Trade is a highly complex affair. This is why pushing the Doha agenda through to any kind of successful conclusion has been a bit like herding cats for Lamy and his team.

One instance of this is the long and complex road the WTO has had to take simply to get to the present near-impasse on ways of protecting the intellectual property of foodstuffs associated with specific regions, such as Champagne or Roquefort cheese. Its TRIPS committee (Trade-Related aspects of Intellectual Property RightS) recently lost its chairman, Trevor Clarke, who stepped down as chair of the special committee dealing with just one element of TRIPS, relating to wines and spirits. He compiled a “way forward” report for his successor that listed five guiding principles. The mind boggles at how the WTO could possibly make progress across the broad front of IP (intellectual property). And important as it is, IP protection is just one element of international trade. This is why some leading commentators are suggesting that while the WTO’s efforts remain important, global trade is actually advancing outside its remit and despite its efforts, through bi-lateral and regional trade agreements. Eventually, of course, these should “marry up” and the WTO will then be able to enjoy something of a surge forward. For now, not too many people are holding their breath and Doha is looking as dead as the proverbial dodo.

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Tags: Doha , global imbalances , protectionism , WTO
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